Educational institution exemption under GST shifts with IIM Act recognition and entry-specific relief for covered programmes.
A statutory change under the Indian Institute of Management Act, 2017 brought IIM Calcutta within the definition of an "educational institution" in Notification No. 12/2017-Central Tax (Rate) from 31.01.2018, because the institution then acquired recognised status and power to grant qualifications. Before that date, exemption under Entry 66 was unavailable, though Entry 67 could apply to specified IIM programmes. From 31.01.2018 to 31.12.2018, exemption was available under either entry for eligible services. After Entry 67 was deleted from 01.01.2019, exemption continued only under Entry 66.
Issues: (i) Whether the Indian Institute of Management, Calcutta became an educational institution for purposes of Notification No. 12/2017-Central Tax (Rate) after the Indian Institute of Management Act came into force on 31.01.2018; (ii) whether exemption under Entry No. 66 and Entry No. 67 of Notification No. 12/2017-Central Tax (Rate) was available, and from which date.
Issue (i): Whether the Indian Institute of Management, Calcutta became an educational institution for purposes of Notification No. 12/2017-Central Tax (Rate) after the Indian Institute of Management Act came into force on 31.01.2018.
Analysis: Clause 2(y) of the exemption notification defines an educational institution to include an institution providing education as part of a curriculum for obtaining a qualification recognised by law. After the Indian Institute of Management Act, 2017 came into force on 31.01.2018, the Indian Institutes of Management were given the status of institutions of national importance and were empowered to grant degrees, diplomas and other academic distinctions. That statutory change brought the respondent within the definition in clause 2(y).
Conclusion: The respondent was an educational institution from 31.01.2018.
Issue (ii): Whether exemption under Entry No. 66 and Entry No. 67 of Notification No. 12/2017-Central Tax (Rate) was available, and from which date.
Analysis: Entry No. 66 exempted services supplied by an educational institution, while Entry No. 67 specifically covered certain programmes of the Indian Institutes of Management. On the basis of the statutory change and the clarificatory circular, the respondent was not entitled to Entry No. 66 for the period before 31.01.2018, but could claim the specific exemption under Entry No. 67 for the covered programmes during that earlier period. From 31.01.2018 to 31.12.2018, the respondent could avail exemption under either entry for eligible programmes. After deletion of Entry No. 67 with effect from 01.01.2019, exemption continued under Entry No. 66.
Conclusion: Exemption was unavailable under Entry No. 66 before 31.01.2018, available under Entry No. 67 for specified programmes during that period, available under either entry from 31.01.2018 to 31.12.2018, and thereafter available under Entry No. 66.
Final Conclusion: The advance ruling was modified to reflect the changed statutory position and the appeal was disposed of accordingly, leaving the respondent entitled to exemption only within the limits stated above.
Ratio Decidendi: Where a subsequent statute confers recognised academic status and power to grant qualifications, the institution falls within the exemption definition for educational institutions from the date of that statutory change, and a specific entry for a special class of services continues to govern the period before and during the transition unless displaced by the later legal position.
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