Case Law Details
Case Name : In re Ms Ernakulam Medical Centre Pvt. Ltd. (GST AAR Kerala)
Related Assessment Year :
Courts :
AAR Kerala Advance Rulings
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In re M/s. Ernakulam Medical Centre Pvt. Ltd. (GST AAR Kerala)
i) Supply of medicines and allied items provided by a hospital through pharmacy to in-patients is part of composite supply of health care treatment and hence not separately taxable. ii) Supply of medicines and allied items provided by hospital through pharmacy to out-patients is taxable.
Also Read AAAR Ruling- GST on supply of medicines etc. via pharmacy of
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This adavance ruling Authority has not considered the fact that drugs, medicines and goods like stent are controlled by DPCO under Essential Commodities Act.These are sold at MRP inclusive Tax by pharmacy. The MRP is fixed by NPPA or approved by NPPA which is a statutory body. Moreover, the Pharmacy issues separate bill under Rule 65 of Drugs and Cosmetics Act of such supply. Hence supply of Drugs, Medicines and Stent is separate and independent supply and not a composite supply as held by Advance Ruling Authority.
This advance ruling provides for double taxation as medicines supplied by hospital pharmacy is sold at MRP which includes GST.
Sir,
Please clarify also that in providing medicines through pharmacy to in-patients, a hospital can collect margin? That is can collect a margin from purchase rate to MRP.