Case Law Details
In re 2Coms Foundation (GST AAR Maharashtra)
We find that the applicant, as a NEEM facilitator, is to identify and provide/enrol trainees to the Industry Partners for which they would charge and receive a fixed administrative fee per trainee per month on which they would also discharge GST. The applicant, in lieu of agreements with the industry partners, prepare monthly attendance record of the trainees, processes stipends of the trainees, makes payment of stipend to the trainees and discharge all functions & duties as mandated to be performed as a facilitator under NEEM Regulations including preparation and submission of monthly invoice relating to payment of stipend.
Regarding the issue in respect of stipend paid to the trainees by the applicant, it has been submitted by the applicant that the concerned Industry Partners will provide training to the trainees and are required to pay stipend to the trainees as per the NEEM Regulations. Even though, it is seen that the services will be provided by the trainees to the Industry Partners, for which stipend is mandated to be paid to the trainees by the Industry Partners, this stipend is not directly paid to the trainees by the said Industry Partners but will be routed through the applicant as per the NEEM Regulations. The entire amounts received as stipend from the Industry Partners will be paid to the trainees without any amount being retained. Thus, the applicant is only acting as an intermediary in collecting the stipend from the Industry Partners and then disbursing the same to the trainees in full without making any deductions from the stipend before disbursement to the trainees. The applicant is only a conduit for the payment of stipend and the actual service is supplied by the trainees to the Industry Partners against which stipend is payable. The amount of stipend received by the applicant from the Industry Partners and paid in full to the trainees is not taxable at the hands of the applicant. Hence, in view of the submissions made by the applicant and also in agreement with the observations made by the jurisdictional officer, it is held that the stipend paid by the Industry Partners to the applicant to be further paid to the trainees in full does not attract GST and is not required to be added to the taxable value.
In a similar case of M/s Yashaswi Academy for Skills as well as M/s Patle Eduskills Foundation, this Authority has held that the reimbursement by Industry Partner to the applicant, of the stipend paid to the trainees, does not attract tax under the GST Act.
Since the matters in the Yashaswi Academy case as well as the Patle Eduskills Foundation case decided by this authority are very similar to the facts of the subject case, we have no reason to deviate from our ruling given in the said cases, which are also applicable in the subject case.
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