No GST Exemption to AIIMS for pure services received from Vendors [Read Advance Ruling]

All India Institute of Medical Sciences is committed to supply quality health and medical Education services, In this regard they have been receiving pure services such as Manpower services, Housekeeping services and consultancy services from vendors on which GST is charged @18%.

1. Whether All India Institute of Medical Sciences can claim GST Exemption on pure services received from Vendors?

Discussion and Findings:

The applicant All India Institute of Medical Sciences (AIIMS), Bibinagar, is purchasing pure services such as Manpower supply, Security Services & Accountancy Services. In the statement of facts, they have claimed that the vendors of these Services are charging GST at the rate of 18% on the services supplied. They also submitted that being an education institution their Output service is exempt and therefore they are reversing the Input tax credit amount into Rs.2 to 3 Crs annually. They submitted that their Institution is the Central Government. And hence supplies made to their Institution are exempt under entry 3 & 3A of Notification 12/2017. To support their claim they are Central Government they submitted document evidence:

AIIMS, Bibinagar falls directly under the purview of the Ministry of Health & Family Welfare (MOHFW) and is created by an Act of Parliament Act.

That Section 5 of the AIIMS Act 1956 designates them as an “Institute of National Importance”.

That they are financed by Central Government by way of appropriation made by Parliament by Law in this behalf under Section 15 of the said Act.

That their accounts are audited by the comptroller and auditor General of India.

As seen from the above evidence the applicant is not Central Government but a “Governmental Authority” as it is established by the Government by the Act of Parliament. The Sl.No. 3 & 3A of Notification 12/2017 as amended with effect from 01.01.2022 have omitted the phrase Governmental Authority from the description of the services. Hence the applicant is not eligible for exemption under these two serial numbers.

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