In re Indian Institute of Management (GST AAR Gujrat)
The applicant, M/s. Indian Institute of Management, Ahmedabad, is a GST-registered educational institution established under the Indian Institutes of Management Act, 2017, which declared certain IIMs as institutions of national importance. The applicant sought an advance ruling on two issues under Section 51 of the CGST Act, 2017 read with Notification No. 50/2018-Central Tax dated 13.09.2018.
The first issue was whether the applicant qualifies as a ‘specified person’ required to deduct tax at source (TDS) under Section 51. The second issue concerned the determination of the ₹2.5 lakh threshold for TDS—whether it applies to the total value of supply under each contract (excluding GST), irrespective of the number of invoices issued.
Under Section 51, the Government may mandate certain categories of persons to deduct TDS at 1% where the total value of supply under a contract exceeds ₹2.5 lakh. Notification No. 50/2018-CT specifies that an authority, board, or body set up by an Act of Parliament or State Legislature, or established by Government, with 51% or more participation by way of equity or control, is covered.
The applicant contended that it does not meet the 51% equity or control condition. It argued that it has no equity structure as it is a not-for-profit entity under Section 9(1) of the IIM Act. It further submitted that only 2 out of approximately 14 members of its Board represent the Government, and that the Central Government’s role is limited to general oversight and rule-making, without day-to-day operational control.
