In re University of Kota (GST AAR Rajasthan)
Affiliation services of a university to its constituent colleges is ‘Supply of Service’ and is liable to GST
The AAR, Rajasthan in the matter of M/s University of Kota [Advance Ruling No. RAJ/AAR/2022-23/16 dated November 11, 2022] has held that the affiliation provided by the University of Kota to its constituent colleges for imparting education is a supply and taxable under Goods and Services Tax (“GST”) and is not exempted under Notification No. 12/2017- Central Tax (Rate) dated June 28, 2017 (“the Services Exemption Notification”).
Facts:
M/s University of Kota (“the Applicant”) was enacted under Special Act of State Legislative Assembly and is engaged in providing services of education including affiliation to various self-financing/non-Government colleges under its jurisdiction as per the education policy of the State Government. The Applicant grants recognition to the colleges under its jurisdiction and collects affiliation fee as approved by the State Government.
The Applicant submitted that they are not meant to earn profit and is only for the sole purpose of education. The Applicant relied on the fact that the affiliation fees collected by them is actually recovered from the fees of students thus, it is a supply of service to students. Also, as the Affiliation fees are paid out of the fees collected and not by operating any other trade therefore, the services provided by Applicant clearly fall under clause 66 of the Services Exemption Notification.
Issues:
(1) Whether the services provided by the Applicant relating to affiliation granted to colleges for imparting education is a supply of service liable to levy of GST?
(2) Whether amount collected by way of affiliation fee is exempted vide S. No 66 of the Services Exemption Notification?
Held:
The AAR, Rajasthan in Advance Ruling No. RAJ/AAR/2022-23/16 held as under:
