Charitable adoption services and regulated adoption fees qualify for GST exemption under the child welfare framework.

Activities involving shelter, care, basic education, skill development and adoption facilitation for abandoned, orphaned and homeless children qualify as charitable activities under the GST exemption notification when carried on by a registered specialised adoption agency. Because the services extend beyond mere custody and are part of the statutory child welfare and adoption framework, the connected adoption fees fixed under the Adoption Regulations, 2017 are also exempt from GST. The ruling treats the regulated adoption fee, received only within that framework, as part of the exempt charitable activity.

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Issues: Whether the applicant's activities of sheltering, caring for, educating, and facilitating adoption of abandoned, orphaned, or homeless children constituted charitable activities exempt under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, and whether the adoption fees received under Regulation 46 of the Adoption Regulations, 2017 were liable to GST.

Analysis: The applicant was registered under section 12AA of the Income-tax Act, 1961 and functioned as a specialized adoption agency under the Juvenile Justice regime. The activities included care, shelter, basic education, skill development, and adoption facilitation for abandoned, orphaned, and homeless children. On the facts, the services rendered were not confined to mere custody of children but also included advancement of educational programmes and skill development relating to the specified category of children. The adoption fees were fixed and regulated by the statutory adoption framework and were received only within that framework. The activity of facilitating adoption, together with the connected care and educational functions, fell within the expression "charitable activities" in the exemption notification.

Conclusion: The applicant's activities were held to be charitable activities exempt from GST, and the adoption fees received from prospective adoptive parents were also held to be exempt from the levy of Goods and Services Tax.

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