Case Law Details

Case Name : In re Manupatra Information Solutions Private Limited (GST AAR Uttar Pradesh)
Appeal Number : Advance Ruling No. UP ADRG 87/2021
Date of Judgement/Order : 25/11/2021
Related Assessment Year :

In re Manupatra Information Solutions Private Limited (GST AAR Uttar Pradesh)

We find that the nil rate of tax is applicable only on supply of online educational journals or periodicals under si. No. 66(b)(v) of the notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 as amended and the said entry does not cover supply of E-books, Newspapers, directories and non-educational journals or periodicals.

We find that the invoices issued by the applicant to different educational institutions (as detailed in Para 8 above) have mention of description ‘Annual Subscription Online Database’ and the same have no mention of “online educational journals or periodicals”. As such, the applicant is collecting a subscription fee which is nothing but the fee charged to gain access to the data available in the database and to download the articles or information. The said invoices are not in respect of supply of online educational journals or periodicals.

We proceed to examine the terms database, journal and periodical. The dictionary meaning of the aforesaid terms are as under-

(1) As per Cambridge dictionary, database is large amount of information stored in a computer system in such a way that it can be easily looked at or changed.

(2) As per Britannica.com, database, is any collection of data, or information, that is specially organized for rapid search and retrieval by a computer.

(3) As per Cambridge dictionary, journal is a serious magazine or newspaper that is published regularly about a particular subject.

(4) As per Collinsdictonary.com, a journal is a magazine, especially one that deals with a specialized subject.

(5) As per Cambridge dictionary, periodical is a magazine or newspaper, especially on a serious subject, that is published regularly.

(6) As per Collinsdictonary.com, periodicals are magazines, especially serious or academic ones, that are published at regular intervals.

In our considered view, Database and journals or periodicals are different thing and exemption is not available to online database, online books, newspapers, directories and non-educational journals under si. No. 66(b)(v) of the notification no. 12/2017-Central Tax (Rate) dated 28th June 2017.

FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, UTTAR PRADESH

1. M/s Manupatra Information Solutions Private Limited, B-37, Sector-1, Noida, Gautam Budh Nagar-201301 (here in after referred to as the applicant) is a registered assessee under GST having GSTN 09AACCM5884H1Z2.

2. The applicant has filed application for advance ruling in Form ARA-01 and submitted as under-

(1) they are engaged in providing online text based information such as online books, newspapers, periodicals, directories etc (judgements/Notifications/Bare Acts/Rules/E books/News/Articles) through their website www.manupatra.com to law firms, lawyers, companies, government, judiciary, law schools.

(2) their services come under SAC code 997331 and the applicable rate of GST is 18%.

(3) As per notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 further amended by notification no. 02/2018-Central Tax (Rate) dated 25th January 2018, against Serial number 66;

Services provided –

(b) to an educational institution, by way of,-

“(v) supply of online educational journals or periodicals:”;

is taxed at NIL rate.

(4) This has created confusion as some law schools are insisting that GST is not applicable to them on account of the above Notification as amended.

3. The applicant has sought advance ruling on following questions-

As per notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 further amended by notification no. 02/2018-Central Tax (Rate) dated 25th January 2018, against Serial number 66;

Services provided –

(b) to an educational institution, by way of-

“(y) supply of online educational journals or periodicals:

is taxed at NIL rate.

This has created confusion as some law schools are insisting that GST is not applicable to them on account of the above Notification as amended.

We would like to know if our services referred above are covered by the above amendment. If the answer is in the affirmative, do we charge GST at NIL rate ?

4. The applicant have submitted that as per their interpretation, on-line text based information such as online books, newspapers, periodicals, directories (judgments/Notifications /Bare Acts/Rules/E books /News/ Articles etc. ) through their website www.manupatra.com should be taxed @ 18%. However, their competitors in similar line of business are charging NIL rate of tax on identical services.

5. As per declaration given by the applicant in Form ARA-01, the issue raised by the applicant is neither pending nor decided in any proceedings under any of the provisions of the Act, against the applicant.

6. The application for advance ruling was forwarded to the Jurisdictional GST Officer to offer their comments/views/verification report on the matter. The Additional Commissioner, Commercial Taxes, Gautam Budh Nagar Zone, Noida vide his letter C.No 1182/Adi. Comm. Va. Ka. Gau. Bu. Na. Zone Noida/2021-22 dated nil submitted that-

(1) the applicant have obtained registration for the following-

(a) Description of Goods- Printed Books, Brochures, Leaflets and similar printed matter, dies, Tapes, Solid state Non-Volatile storage Devices etc

(b) Description of services- On-line text based information such as online books, newspapers, periodicals, directories etc

(2) the applicant have obtained registration for services ‘On-line text based information such as online books, newspapers, periodicals, directories and the applicant are providing the said services only which are not covered in the entry 66(b)(v) of notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 as amended by Notification No. 02/2018-Central Tax (Rate) dated 25.01.2018.

(3) the applicant are not supplying online educational journals or periodicals as such the said supply is not nil rated and chargeable to 18%.

(4) no proceedings are pending against the applicant in respect of question on which advance ruling has been sought.

7. The applicant was granted a personal hearing on 11.11.2021 which was attended by Shri Deepak Kapoor, Director and Shri Vijay Singh Negi, Accounts Manager during which they reiterated the submissions made in the application of advance ruling.

8. The applicant vide email dated 16.11.2021 provided copies of following invoices issued by them-

SN Invoice No Date Invoice issued to Description of Sale
1 MANU03216016 25-03-21 Benaras Hindu University Varanasi Annual Subscription Online Database
2 MANU11213521 08-11-21 National Law School of India University, Bangalore do
3 MANU 11203048 03-11-20 Aligarh Muslim University Aligarh do
4 MANU03215664 10-03-21 RML National Law University, Lucknow do
5 MANU06210960 23-06-21 I IM, Kolkata do
6 MANU08212139 26-08-21 I IM, Bangalore do
7 MANU0721 1538 27-07-21 Sastra Deemed University, Thanjavur do
8 MANU09212353 06-09-21 CHRIST (Deemed to be university), Ghaziabad do
9 MANU07211U2 01-07-21 University of Delhi do
10 MANU01214163 05-01-21 OP Jindal Global University Sonipat do

DISCUSSION AND FINDINGS-

9. At the outset, we would like to make it clear that the provisions of both the CGST Act and the UPGST 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 UPGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, a reference to such a similar provision under the CGST Act / UPGST Act would be mentioned as being under the ‘CGST Act’.

No GST exemption on online database, online books, newspapers, directories & non-educational journals

10. We have gone through the Form GST ARA-01 filed by the applicant and observed that the applicant has ticked following issues on which advance ruling required-

(ii) Applicability of a notification issued under the provisions of this Act

We find that the issue raised in the application is squarely covered under Section 97(2) of the CGST Act 2017. We therefore, admit the application for consideration on merits.

11. We have gone through the submissions made by the applicant and have examined the same. We observe that the applicant has sought advance ruling on the following question-

As per notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 further amended by notification no. 02/2018-Central Tax (Rate) dated 25th January 2018, against Serial number 66;

Services provided –

(b) to an educational institution, by way of-

“(v) supply of online educational journals or periodicals:

is taxed at NIL rate.

This has created confusion as some law schools are insisting that GST is not applicable to them on account of the above Notification as amended.

We would like to know if our services referred above are covered by the above amendment. If the answer is in the affirmative, do we charge GST at NIL rate ?

12. We find that the applicant desired to know as to whether their services are covered in the amendment done by the Notification No. 02/2018-Central Tax (Rate) dated 25.01.2018 in the notification no. 12/2017-Central Tax (Rate) dated 28th June 2017. The applicant have submitted in Form GST ARA-01 that they are providing on-line text based information such as online books, newspapers, periodicals, directories etc (judgements/Notifications/Bare Acts/Rules/E books/News/Articles) through their website www.manupatra.com to law firms, lawyers, companies, government, judiciary, law schools. The applicant have also submitted in Form GST ARA-01 that as per their interpretation, on-line text based information such as online books, newspapers, periodicals, directories (judgments/Notifications /Bare Acts/Rules/E books /News/ Articles, etc.) through our website www.manupatra.com should be taxed @ 18%.

13. We find that after sub-item (iv) of the SI. No. 66(b) of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, the sub-item “(v) supply of online educational journals or periodicals” was inserted vide notification no. 02/2018-Central Tax (Rate) dated 25th January 2018. After the said amendment, the relevant notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 is as under-

SI. No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (per cent.) Condition
66  Heading 9992 Services provided –

(a) by an educational institution to its students, faculty and staff;

(aa) by an educational institution by way of conduct of entrance examination against consideration in the form of entrance fee

(b) to an educational institution, by way of

(i) transportation of students, faculty and staff;

(ii) catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory;

(iii) security or cleaning or housekeeping services performed in such educational institution;

(iv) services relating to admission to, or conduct of examination by, such institution;

(v) supply of online educational journals or periodicals

Provided that nothing contained in sub-items (i), (ii) and (iii) of item (b) …………

Provided further that nothing contained in sub-item (v) of item (b) shall apply to an institution providing services by way of-

(i) pre-school education and education upto higher secondary or equivalent or

(ii) education as a part of an approved vocational education course.

 Nil Nil

14. We find that the nil rate of tax is applicable only on supply of online educational journals or periodicals under si. No. 66(b)(v) of the notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 as amended and the said entry does not cover supply of E-books, Newspapers, directories and non-educational journals or periodicals.

15. We find that the invoices issued by the applicant to different educational institutions (as detailed in Para 8 above) have mention of description ‘Annual Subscription Online Database’ and the same have no mention of “online educational journals or periodicals”. As such, the applicant is collecting a subscription fee which is nothing but the fee charged to gain access to the data available in the database and to download the articles or information. The said invoices are not in respect of supply of online educational journals or periodicals.

16. We proceed to examine the terms database, journal and periodical. The dictionary meaning of the aforesaid terms are as under-

(1) As per Cambridge dictionary, database is large amount of information stored in a computer system in such a way that it can be easily looked at or changed.

(2) As per Britannica.com, database, is any collection of data, or information, that is specially organized for rapid search and retrieval by a computer.

(3) As per Cambridge dictionary, journal is a serious magazine or newspaper that is published regularly about a particular subject.

(4) As per Collinsdictonary.com, a journal is a magazine, especially one that deals with a specialized subject.

(5) As per Cambridge dictionary, periodical is a magazine or newspaper, especially on a serious subject, that is published regularly.

(6) As per Collinsdictonary.com, periodicals are magazines, especially serious or academic ones, that are published at regular intervals.

17. In our considered view, Database and journals or periodicals are different thing and exemption is not available to online database, online books, newspapers, directories and non-educational journals under si. No. 66(b)(v) of the notification no. 12/2017-Central Tax (Rate) dated 28th June 2017.

18. Accordingly, we pass the following order-

RULING

Question- As per notification no. 12/2017-Central Tax (Rate) dated 28th June 2017 further amended by notification no. 02/2018-Central Tax (Rate) dated 25th January 2018, against Serial number 66;

Services provided –

(b) to an educational institution, by way of-

“(v) supply of online educational journals or periodicals:

is taxed at NIL rate.

This has created confusion as some law schools are insisting that GST is not applicable to them on account of the above Notification as amended.

We would like to know if our services referred above are covered by the above amendment. If the answer is in the affirmative, do we charge GST at NIL rate ?

Answer- Replied in negative.

19. This ruling is valid only within the jurisdiction of Authority for Advance Ruling Uttar Pradesh and subject to the provisions under Section 103(2) of the CGST Act, 2017 until and unless declared void under Section 104(1) of the Act.

Download Judgment/Order

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