Supply of Medicines and Consumables with Healthcare Services is Composite Supply: AAR

The applicant company, Kamakshi Memorial Hospital Pvt Ltd, is a multispecialty hospital that provides health care services. The hospital provides both in-patient and outpatient services, such as consultations, diagnostics, surgeries, intensive care and allied medical services.

The applicant sought an advance ruling before the Tamil Nadu Authority for Advance Ruling (AAR) for the following questions:

Q1. Whether supply of medicines and consumables used in the course of providing health care services to In-patients by pharmacy a unit of Dr.Kamakshi Memorial Hospital Pvt. Ltd., for Diagnosis or treatment during the patients’ admission in hospital would be considered “Composite Supply of Healthcare Service” under GST and consequently avail exemption under Notification No. 12/2017, CT (Rate) read with section 8(a) of the GST Act?

As per Tamil Nadu AAR, supplying medicines and consumables along with providing health care services to in-patients would be treated as a composite supply, and the same is exempted from GST under Entry No. 74 of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, read with Section 8(a) of the CGST Act, 2017.