In re IMS Proschool PVT LTD. (GST AAR Maharashtra)
Q.1. – Whether educational courses offered by the Applicant which have been approved by National Skill Development Corporation (hereinafter referred to as “NSDC”) would be construed as in relation to National Skill Development Programme implemented by NSDC?
Answer : Answered in the negative.
Q.2. The Applicant offers certain educational courses for which qualification standards/ framework i.e. QP/ NOS has not been defined by NSDC and will be approved by NSDC as and when the relevant QP/ NOS would be defined by NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/ NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC?
Answer : Answered in the negative.
Q.3.- In certain situations, NSDC approved educational courses are subsequently, upgraded by the Applicant within pre-defined QP/ NOS framework, by way of adding more topics/ content /modules. However, such modified version of NSDC approved educational courses have not been approved by NSDC yet. Whether such modified version will be treated as in relation to National Skill Development Programme implemented by NSDC?
Answer : Answered in the negative.
Q.4.- If the answer to Q.1, Q.2 and Q.3 are Yes, then whether the benefit of GST exemption as per Notification No. 12/2017- Central Tax (Rate), dated the 28th June 2017 would be available to the Applicant?
Answer : No, in view of answers to Q.No. 1, 2 and 3 above.
Q.5. – If answer to Q.4 is Yes, whether benefit of GST exemption as per Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 would be still available if such educational courses are offered to corporates and business institutions?
Answer : No, in view of answers to Questions above.
Q.6.- Whether the NSDC approved educational courses which are actually imparted by the business partners of the Applicant, on behalf of the Applicant as sub-contractor of Applicant, at various centres located across the country, will be considered as offered by the Applicant?
Answer : Not relevant and not being answered in view of the answers to question above.
Q.7. – If answer to Q.6 is Yes, whether benefit of GST exemption as per Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 would be available to the Applicant?
Answer : No in view of the answers to question above.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, MAHARASHTRA
The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST Act”] by IMS PROSCHOOL. PVT LTD., the applicant, seeking an advance ruling in respect of the following questions :
Q.1. – “Whether educational courses offered by the Applicant which have been approved by National Skill Development Corporation (hereinafter referred to as “NSDC”) would be construed as in relation to National Skill Development Programme implemented by NSDC?”
Q.2. -“The Applicant offers certain educational courses for which qualification standards/framework i.e. QP/NOS has not been defined by NSDC and will be approved by NSDC as and when the relevant QP/NOS would be defined by NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC?”
Q.3.- “In certain situations, NSDC approved educational courses are subsequently, upgraded by the Applicant within pre-defined QP/ NOS framework, by way of adding more topics/ content /modules. However, such modified version of NSDC approved educational courses have not been approved by NSDC yet. Whether such modified version will be treated as in relation to National Skill Development Programme implemented by NSDC?”
Q.4.- “If the answer to Q.1, Q.2 and Q.3 are Yes, then whether the benefit of GST exemption as per Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 would be available to the Applicant?”
Q.5. – “If answer to Q.4 is Yes, whether benefit of GST exemption as per Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 would be still available if such educational courses are offered to corporates and business institutions?”
Q.6.- “Whether the NSDC approved educational courses which are actually imparted by the business partners of the Applicant, on behalf of the Applicant as sub-contractor of Applicant, at various centres located across the country, will be considered as offered by the Applicant?”
Q.7. – “If answer to Q.6 is Yes, whether benefit of GST exemption as per Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 would be available to the Applicant?”
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / MGST Act would be mentioned as being under the “GST Act”.
02. FACTS AND CONTENTION – AS PER THE APPLICANT
The submissions, as reproduced verbatim, could be seen thus –
STATEMENT OF RELEVANT FACTS HAVING A BEARING ON THE OUESTION(S) ON WHICH ADVANCE RULING IS REQUIRED.
II.1 IMS Proschool Pvt Ltd, the Applicant is a company incorporated under the Companies Act, 1956 having its registered office at Mumbai, Maharashtra.
II.2 The Applicant is an initiative of IMS Learning Resources and offers educational training and skilling courses through classroom training and virtual coaching, in many areas such as data science, digital marketing, IFRS, ACCA, Fitter – Mechanical Assembly, Basic Electrical, Sales Person Retail etc. across many cities in India including Mumbai, Pune, Chennai, Bangalore, Delhi, Hyderabad, Gurgaon, Kochi and several districts of Gujarat
II.3 The Applicant is engaged, in the business of skilling the youth with the objective of helping them find decent job, make them employable and to help them earn better living. This includes preparing graduates and working professionals to appear for various National and International certifications for career development needs, including NCFM Financial Modelling, Financial Analysis, Management Accounting, Business Analytics and various other post graduate programs, in areas of finance, business analytics and marketing as well as technical programs such as Fitter, Basic Electrical and Sales Person Retail.
II.4 For imparting the aforesaid training, the Applicant has developed its own proprietary training formats, materials and methodology, which are conducted at its centers located in various cities and sometimes at location of business institutions and Govt. organisations. The clientele of the Applicant includes individuals, corporates, educational institutions, Govt. organizations.
II.5 The technical and vocational educational courses offered by the Applicant are either funded by NSDC / Central Govt./ State Govt. or are paid up courses which are enrolled by individuals, corporates.
II.6 The Applicant is an approved training partner of NSDC and till date, 12 educational courses offered by it have been approved by NSDC. Further, 2 educational courses for which QP/ NOS have not been defined by NSDC yet, have been conditionally approved by NSDC. All such courses offered by the Applicant are directed for skill development and to increase employability in India.
II.7 The Applicant has tie-ups with various educational institutes / Govt. organizations, including NSDC,, National Stock Exchange Academy, Symbiosis International University, Indira Institute of Management, Lovely Professional University, Chartered Financial Institute, Chartered Institute of Management Accountant.
II.8 The Applicant has obtained registration under Goods and Service Tax (hereinafter referred to as ‘GST’) regime in states of Maharashtra, Haryana, New Delhi, Karnataka, Kerala, Tamil Nadu, Telangana and Gujarat.
STATEMENT CONTAINING APPLICANT’S INTERPRETATION OF LAW AND/OR FACTS, AS THE CASE MAY BE, IN RESPECT OF QUESTION(S) ON WHICH ADVANCE RULING IS REQUIRED.
Question of law
Question of law: (1) “Whether educational courses offered by the Applicant which have been approved by National Skill Development Corporation (hereinafter referred to as “NSDC”) would be construed as in relation to National Skill Development Programme implemented by NSDC?”
IV.l.The Applicant submits that in the present case, the Advance Ruling sought by the Applicant relates to the matter as to:
“Whether educational courses offered by the Applicant which have been approved by National Skill Development Corporation (hereinafter referred to as “NSDC”) would be construed as in relation to National Skill Development Programme implemented by NSDC”
Services rendered by the Applicant
IV.2. The Applicant renders educational training and skilling services to individuals, corporates, educational institutions and Govt. institutions / organizations. As a part of such services, the Applicant conducts various professional, technical, vocational educational courses such as NCFM Financial Modelling, Financial Analysis, Management Accounting, Financial Planning, Business Analytics and various other post graduate programs in areas of finance, business analytics and marketing as well as technical programs such as Fitter, Basic Electrical and Sales Person Retail. Under GST law, the said education services rendered by the Applicant merit classification under HSN 9992.
IV.3. The Applicant is also, an approved training partner of NSDC. The certificate in relation thereto, has been enclosed herewith asExhibit 2.
IV.4. The following educational courses (hereinafter referred to as ‘approved educational courses’) till date, have been already approved by NSDC:
(1) Financial modelling
(2) Financial analyst
(3) Management accounting
(4) Strategic management accounting
(5) Business accounting
(6) Financial planning
(7) Business analytics
(8) Sales person retail
(9) Basic electrical training
(10) CGSC Fitter Mechanical Assembly
(11) Data Science
(12) IFRS
Copy of the approval received from NSDC in relation to all the aforesaid educational courses have been enclosed herewith as “Exhibit 3.”
GST provisions
IV.4. Entry 69 to the Notification No. 12/2017-Central Tax (Rate), dated the 28th June 2017 (‘the Notification’) exempts from GST levy:
Education services (specified under HSN 9992) provided by:
(a) the National Skill Development Corporation set up by the Government of India;
(b) a Sector Skill Council approved by the National Skill Development Corporation;
(c) an assessment agency approved by the Sector Skill Council or the National Skill Development Corporation;
(d) a training partner approved by the National Skill Development Corporation or the Sector Skill Council in relation to-
(i) the National Skill Development Programme implemented by the National Skill Development Corporation; or
(ii) a vocational skill development course under the National Skill Certification and Monetary Reward Scheme; or
(iii) any other Scheme implemented by the National Skill Development Corporation transaction.
Copy of the Notification has been enclosed herewith as “Exhibit 4.”
IV.5. On simple reading of the Notification, it is apparent that GST exemption is available to an approved training partner of NSDC, only if education services rendered by such partner, is in relation to:
(i) the National Skill Development Programme implemented by NSDC; or
(ii) a vocational skill development course under the National Skill Certification and Monetary Reward Scheme; or
(iii) any other Scheme implemented by the National Skill Develeopmemt Corporation
IV.6. The Applicant would like to submit that the Scheme mentioned above under Sr. No. (ii) and (iii), has been specifically implemented by the respective Govt. department /organisation. For example, NSDC has implemented various Schemes such as PMKK, PMKVY, Udaan, International Skill Training, etc., which would get covered under Sr. No. (iii) mentioned above. Further, various courses have been announced under National Skill Certification and Monetary Reward Scheme which will get covered as vocational skill development courses at Sr. No. (ii) above. Therefore, any educational course which are in connection to such specified schemes or vocational courses, will be liable to GST exemption under the Notification.
IV.7. The Applicant would like to further submit that, till date, NSDC has not announced explicitly any course/ programme which would be considered as part of National Skill Development Programme implemented by NSDC. Therefore, in absence of any explicit National Skill Development Programme which can be considered as implemented by NSDC, one needs to determine under what circumstances, any programme / scheme/ educational course would qualify as in relation to National Skill Development Programme implemented by NSDC.
Information about NSDC
IV.8. NSDC was set up by Ministry of Finance to narrow the gap between demand and supply of skilled resources, reduce unemployment in India and to fulfil the growing need of skilled manpower across various industries and sectors. Role of NSDC is to act as a catalyst for creation of quality skills training institutions across the country and also, to support private sector initiatives for skill development.
IV.9. NSDC partners with various training institutions to achieve its mission and objectives of elevating skilled manpower. In this regard, NSDC develops partnerships with multiple stakeholders and build on current efforts of such stakeholders, rather than undertaking initiatives directly and duplicating efforts.
IV.10. It is evident from the above that, NSDC to achieve its objectives, does not undertake / implement any schemes, programmes on its own, rather, it has partnered with various training institutions imparting training courses / programmes related to skill development.
IV.11. Basis the information available on NSDC portal (hereinafter referred to as ‘SDMS’), we understand that the educational courses offered by NSDC training partners, should contain pre-defined qualification standards / knowledge parameters. In this regard, Ministry of Human Resource Development has designed and notified qualification assurance framework i.e. National Vocational Education Qualifications Framework (hereinafter referred to as ‘NVEQF’), which outlines qualifications / levels / competencies of knowledge and skills that a learner must possess, for the purpose of getting any given job role. Within such NVEQF framework, for each job role within identified skill sectors, NSDC has specified different level of skills and learning outcomes i.e. various National Occupational Standards, Qualification Packs, (hereinafter referred to as QP/NOS), to ensure that target level of skill is achieved in particular training program. Such skills / qualifications can be acquired either through formal, non-formal or informal education and training.
Copy of the NVEQF Release F. No. 1-4/2011-VE dated 3 September 2012, notified by Ministry of Human Resource Development is enclosed herewith as ‘Exhibit-5’.
IV.12. On SDMS (i.e. NSDC portal related to skill development educational courses), QP / NOS for each type of job role within identified skill sector has been mentioned. Since there are innumerable job roles and defining QP / NOS is a continuing task hence, QP/ NOS for many job roles have already been defined by NSDC and for many other job roles, they are yet to outline QP / NOS.
IV.13. NSDC training partners are required to align their education courses with defined QP / NOS within identified skill sector. Accordingly, at time of seeking approval for educational courses, each NSDC training partner is required to give an affidavit / declaration to NSDC, giving reference of pre-defined QP / NOS to demonstrate alignment of such course with that is contained in such educational courses.
IV.14. Having said that, the Applicant would like to submit that keeping in mind the objective of NSDC of focusing on employability through placement in industry or self -employment, the approved educational courses offered by the Applicant is linked with different sector or industry. Also, the curriculum of each of the educational courses offered by the Applicant, is aligned to pre-defined QP/ NOS.
Syllabus, training delivery plan and QP /NOS reference in relation to 12 NSDC approved educational courses which are offered by the Applicant have been enclosed herewith as ‘Exhibit-6’.
IV.15. The Applicant would like to further, submit that it is required to upload on SDMS i.e. NSDC portal, the details of approved educational courses offered by it along with the date of approval. The screenshot of all educational courses offered by the Applicant and approved by NSDC as appearing on SDMS is enclosed herewith as ‘Exhibit-7’.
IV.16. The Applicant would like to bring to your notice that, the performance review of all NSDC training partners is done by NSDC who in turn reports the same to Ministry of Skill Development and Entrepreneurship (‘MSDE’).
IV.17. In this connection, for each month, quarter, financial year, in relation to each of the approved educational courses, the Applicant is required to report and upload the following details, on the SDMS (NSDC portal):
• Applicant’s progress towards yearly skill achievement targets;
• Annual and monthly performance of the Applicant such as number of students enrolled, trained, placed, up- skilled;
• Quarterly and yearly training and placements achievements of the Applicant;
• Details of each and every student who was enrolled with the Applicant such as personal detials, date of enrolment, date of passing out, batch starter and end date, training status etc.;
• Status of active and inactive educational centres of the Applicant;
• Details of corporate training programs;
• Details of any other skilling schemes
The documentary evidence of sharing the aforesaid information by the Applicant with NSDC has been enclosed herewith as ‘Exhibit-8’.
IV.18. Further, NSDC conducts candidate data validation exercise every year, in which details of each candidate reported by the Applicant on SDMS (NSDC portal) is validated and verified. Furthermore, NSDC in their emails sent to the Applicant for sharing information related to target achievement of the Applicant, has specified that annual performance review of the Applicant will be done by MSDE and hence, the training and placements details will be shared with MSDE.
IV.19. The Applicant would like to bring to your kind attention that each approved training partner is required to seek approval from NSDC for educational course conducted, upload information on SDMS (i.e. NSDC portal) periodically about its performance review with the intention that NSDC can monitor attainment of skill development targets of such approved training partners.
IV.20. On simple reading of the above, it is evident that the activities of alignment of educational courses with QP / NOS, providing approval for such courses, seeking information of actual training and placements, comparison of yearly targets with the skill development achievements of approved training partners, are being undertaken by NSDC because it has not announced any programme which would be implemented by NSDC itself, to achieve its objectives of enhancing skilled manpower and reducing unemployment in India. Since, NSDC partners with training institutions and does not undertake any training programmes itself, therefore, achievement of approved training partners would be counted as accomplishment of the said objectives of NSDC. Accordingly, all the approved educational courses conducted by the Applicant should be construed as in relation to National Skill Development Programme implemented by NSDC.
I. Question of law: (2) “The Applicant offers certain educational courses for which qualification standards / framework i.e. QP/ NOS has not been defined by NSDC and will be approved by NSDC as and when the relevant QP/ NOS would be defined by NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/ NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC?”
V.1. The Applicant submits that in the present case, the Advance Ruling sought by the Applicant relates to the matter as to:
“The Applicant offers certain educational courses for which qualification standards / framework i.e. QP/ NOS has not been defined by NSDC and will be approved by NSDC as and when the relevant QP/ NOS would be defined by NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/ NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC”
V.2. As mentioned above under Para IV. 11 to IV.13, NVEQF is qualification assurance framework that outlines different type of skill standards, a person should possess for a given job role and also, outlines learning outcomes to ensure particular target level of skill has been achieved in a training program. In this regard, NSDC has defined NOS / QP for many job roles. Such QP / NOS should be aligned to educational courses imparted by NSDC training partners. NSDC has defined QP / NOS for many job roles and they are in in process to outline QP / NOS for other job roles.
NSDC’s educational course avvroval process
V.3. In connection to job role / educational course for which NOS / QPs has been already defined by NSDC, for the purpose of obtaining approval from NSDC, the approved training partner of NSDC is required to align their educational courses as per the listed QPs / NOS.
V.4. At present, the step-by-step NSDC course approval process is explained by way of below flow chart:
