Museum exemption denied where the premises functioned as a profit-oriented visitor attraction, making the services taxable under Heading 9996.

Admission-based exemption for a museum applies only where the premises is, in substance, a non-profit institution devoted to acquisition, conservation, research, exhibition and preservation of heritage objects for public benefit. A proposed visitor attraction developed for profit-oriented amusement and theme-park activity was held not to have the essential character of a museum, so the exemption under Notification No. 12/2017-Central Tax (Rate) was unavailable. The related services were therefore treated as taxable under Heading 9996 for recreational, cultural and sporting services, and GST applied at the prescribed rate.

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Issues: (i) Whether the premises proposed as "Sundha Darshan Museum" qualified as a museum for the purpose of exemption under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017; (ii) whether the services provided or proposed to be provided by the applicant were taxable and, if so, under which service classification.

Issue (i): Whether the premises proposed as "Sundha Darshan Museum" qualified as a museum for the purpose of exemption under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Analysis: The exemption for admission to a museum was considered in light of the service description under Heading 9996 and the commonly accepted meaning of a museum, which contemplates a permanent, non-profit institution that acquires, conserves, researches, exhibits, and preserves objects of artistic, cultural, historical, or scientific importance for public benefit. The proposed premises was found to be developed by a business entity for profit-oriented amusement and theme-park activity, with the museum feature serving to attract visitors. On that basis, the premises was treated as lacking the essential character of a museum.

Conclusion: The premises did not qualify as a museum and the exemption under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 was not available.

Issue (ii): Whether the services provided or proposed to be provided by the applicant were taxable and, if so, under which service classification.

Analysis: Since the claimed exemption was found inapplicable, the services were examined under the tariff entry relating to recreational, cultural and sporting services other than the specified excluded sub-categories. The activity was held to fall within the relevant taxable service entry under Heading 9996, attracting GST at the prescribed rate.

Conclusion: The services were classifiable under the taxable entry for recreational, cultural and sporting services and were liable to GST at 18%.

Final Conclusion: The applicant was not entitled to museum-based exemption, and the proposed activity remained taxable under the service entry applicable to recreational, cultural and sporting services.

Ratio Decidendi: For exemption under the museum entry, the premises must in substance be a non-profit museum with the essential attributes of preservation, conservation, and public exhibition of heritage objects; a profit-oriented visitor attraction does not satisfy that requirement.

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