Pre-school qualifies as educational institution under GST exemption notification for education and related services

AAR Maharashtra ruled that a pre-school qualified as an educational institution under GST exemption notification. The pre-school received nil GST rate on education services, transportation services to students/staff, and canteen services under Serial No. 66 of Notification 12/2017-CT. Goods supplied without consideration as part of composite educational supply also attracted nil rate. However, standalone supply of goods for consideration to students did not qualify for exemption as it constituted separate supply of goods, not services covered under the notification.

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Issues Involved:

1. Coverage under Notification No. 12/2017-CT, dated 28th June 2017, SI No. 66.
2. Entitlement for Nil rate of tax on supply of Pre-school education service against fee.
3. Entitlement for Nil rate of tax on supply of goods to Pre-school students without consideration.
4. Entitlement for Nil rate of tax on supply of goods to Pre-school students for some consideration.
5. Entitlement for Nil rate of tax on supply of transportation service to Pre-school students without consideration.
6. Entitlement for Nil rate of tax on supply of transportation service to Pre-school students for some consideration.
7. Entitlement for Nil rate of tax on supply of transportation service to faculty and staff for some consideration.
8. Entitlement for Nil rate of tax on supply of canteen service to faculty and staff for some consideration.

Issue-wise Detailed Analysis:

Issue 1: Coverage under Notification No. 12/2017-CT, dated 28th June 2017, SI No. 66
The applicant, operating under the trade name "Nashik Cambridge Pre-school," qualifies as an "Educational Institution" as defined in para 2(y) of Notification No. 12/2017-CT (Rate). The services provided by the pre-school to its students, faculty, and staff are covered under SI No. 66 of the said notification, attracting a Nil rate of GST.

Issue 2: Entitlement for Nil rate of tax on supply of Pre-school education service against fee
The pre-school is entitled to a Nil rate of tax on the supply of Pre-school education services to its students against a fee. This is because the services provided fall under the exempted category specified in SI No. 66 of Notification No. 12/2017-CT (Rate).

Issue 3: Entitlement for Nil rate of tax on supply of goods to Pre-school students without consideration
The pre-school supplies goods such as books, stationery, and other items to its students without consideration, with the cost covered in the fee charged. These supplies are part of a composite supply where the principal supply is the educational service, which is exempt under SI No. 66 of Notification No. 12/2017-CT (Rate). Therefore, the supply of these goods is also entitled to a Nil rate of tax.

Issue 4: Entitlement for Nil rate of tax on supply of goods to Pre-school students for some consideration
When the pre-school supplies goods to its students for some consideration, these transactions are considered standalone supplies of goods and not part of any composite supply. As such, these supplies do not fall under the exemption provided in SI No. 66 of Notification No. 12/2017-CT (Rate) and are not entitled to a Nil rate of tax.

Issue 5: Entitlement for Nil rate of tax on supply of transportation service to Pre-school students without consideration
The supply of transportation services to Pre-school students without any consideration is not taxable, as it falls under the definition of services provided by an educational institution to its students, faculty, and staff, which are exempt under SI No. 66 of Notification No. 12/2017-CT (Rate).

Issue 6: Entitlement for Nil rate of tax on supply of transportation service to Pre-school students for some consideration
The supply of transportation services to Pre-school students for some consideration is also covered under the exemption in SI No. 66 of Notification No. 12/2017-CT (Rate), attracting a Nil rate of tax.

Issue 7: Entitlement for Nil rate of tax on supply of transportation service to faculty and staff for some consideration
The supply of transportation services to the pre-school's faculty and staff for some consideration is entitled to a Nil rate of tax under SI No. 66 of Notification No. 12/2017-CT (Rate), as these services are provided by an educational institution to its faculty and staff.

Issue 8: Entitlement for Nil rate of tax on supply of canteen service to faculty and staff for some consideration
The supply of canteen services to the pre-school's faculty and staff for some consideration is also entitled to a Nil rate of tax under SI No. 66 of Notification No. 12/2017-CT (Rate), as these services are provided by an educational institution to its faculty and staff.

Order:

1. Nashik Cambridge Pre-School is covered under Notification No. 12/2017-CT, SI No. 66.
2. The pre-school is entitled to a Nil rate of tax on the supply of Pre-school education services against a fee.
3. The pre-school is entitled to a Nil rate of tax on the supply of goods to its Pre-school students without consideration.
4. The pre-school is not entitled to a Nil rate of tax on the supply of goods to its Pre-school students for some consideration.
5. The pre-school is entitled to a Nil rate of tax on the supply of transportation services to its Pre-school students without consideration.
6. The pre-school is entitled to a Nil rate of tax on the supply of transportation services to its Pre-school students for some consideration.
7. The pre-school is entitled to a Nil rate of tax on the supply of transportation services to its faculty and staff for some consideration.
8. The pre-school is entitled to a Nil rate of tax on the supply of canteen services to its faculty and staff for some consideration.

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