2022 (7) TMI 501 - AAR - GST

Educational institutions' printing services for exam materials and result processing qualify as exempt supplies under GST Serial Number 66

AAR-AP ruled that printing services for examination materials (question papers, OMR sheets, answer booklets) and post-examination items (mark cards, grade ... Services relating to admission to, or conduct of, examination by an educational institution - exemption under Notification No.12/2017-CGST (Serial Number 66) - definition of 'educational institution' as providing education forming part of a recognised curriculum - supply to an educational institutionServices relating to admission to, or conduct of, examination by an educational institution - exemption under Notification No.12/2017-CGST (Serial Number 66) - supply to an educational institution - Printing of pre-examination items (question papers, OMR sheets, answer booklets) supplied to educational institutions engaged in conduct of examinations is exempt as a service under Serial Number 66 of Notification No.12/2017-CGST (Rate). - HELD THAT: - The Authority examined the nature of the applicant's supplies and the text of Entry 66 which exempts services relating to admission to, or conduct of, examinations when provided to an educational institution as defined in the notification. The educational institutions for whom the applicant supplies pre-examination materials fall within the notification's definition (education as part of a curriculum for a recognised qualification). The printing of pre-examination materials is integrally connected to the conduct of examinations and, when supplied to such institutions, falls within the exemption under Serial Number 66. The Authority therefore concurs with the applicant's interpretation and treats the said activity as an exempt supply of service. [Paras 7]Printing of pre-examination items supplied to educational institutions for conduct of examinations is exempt under Serial Number 66 of Notification No.12/2017-CGST (Rate).Services relating to admission to, or conduct of, examination by an educational institution - exemption under Notification No.12/2017-CGST (Serial Number 66) - definition of 'educational institution' as providing education forming part of a recognised curriculum - Printing of post-examination items (marks cards, grade cards, certificates) supplied to educational institutions (up to higher secondary and similar recognised institutions) after processing results is exempt under Serial Number 66 of Notification No.12/2017-CGST (Rate). - HELD THAT: - The Authority noted that printing of post-examination materials is the final leg of the examination process and constitutes a service relating to the conduct of examinations. Given that the recipient institutions qualify as 'educational institution' under the notification, such supplies are captured by Entry 66(b)(iv). The fact that these activities are outsourced does not alter their character as services relating to conduct of examinations and therefore they qualify for the exemption. [Paras 7]Printing of post-examination items supplied to qualifying educational institutions in relation to conduct of examinations is exempt under Serial Number 66 of Notification No.12/2017-CGST (Rate).Services relating to admission to, or conduct of, examination by an educational institution - exemption under Notification No.12/2017-CGST (Serial Number 66) - supply to an educational institution - Scanning and processing of examination results supplied to educational institutions is an exempt service under Serial Number 66 of Notification No.12/2017-CGST (Rate). - HELD THAT: - The Authority held that scanning and processing of OMR sheets and result computation are services intimately connected with the conduct of examinations. When provided to educational institutions that meet the notification's definition, these activities fall within the scope of Entry 66(b)(iv) and are therefore exempt. The reasoning treats ancillary and outsourced activities that form part of the examination process as exempt when supplied to qualifying institutions. [Paras 7]Scanning and processing of examination results supplied to qualifying educational institutions is exempt under Serial Number 66 of Notification No.12/2017-CGST (Rate).Final Conclusion: The Authority: answered affirmatively that (i) printing of pre-examination items, (ii) printing of post-examination items (up to higher secondary) after result processing, and (iii) scanning and processing of examination results, when supplied to educational institutions falling within the notification's definition, are exempt services under Serial Number 66 of Notification No.12/2017-CGST (Rate). Issues Involved:1. Classification of products and applicability of notification for considering the tax rate.2. Whether printing of pre-examination items is an exempted supply of service.3. Whether printing of post-examination items is an exempted supply of service.4. Whether scanning and processing of examination results is an exempted supply of service.Detailed Analysis:1. Classification of Products and Applicability of Notification for Considering the Tax Rate:The applicant, M/s. Universal Print Systems, is engaged in printing various items, including high-end security printing products. They approached the Authority for Advance Ruling to seek clarification on the classification of their products and the applicable tax rate under the GST regime. The relevant notification under consideration is Notification No.12/2017-CGST[Rate] dated 28-6-2017, which outlines exemptions for certain services provided to educational institutions.2. Whether Printing of Pre-Examination Items is an Exempted Supply of Service:The applicant provides printing services for pre-examination items like question papers, OMR sheets, and answer booklets, which are used by educational boards for conducting examinations. The applicant argued that these services should be exempt from GST under Serial Number 66 of Notification No.12/2017-CGST[Rate], which exempts services related to the conduct of examinations by educational institutions. The Authority concurred with the applicant’s interpretation, affirming that these services are indeed exempt from GST.3. Whether Printing of Post-Examination Items is an Exempted Supply of Service:The applicant also provides printing services for post-examination items such as marks cards, grade cards, and certificates. These items are used by educational boards to communicate examination results to students. The applicant contended that these services should also be exempt under the same notification, as they are related to the conduct of examinations. The Authority agreed, ruling that printing of post-examination items is exempt from GST.4. Whether Scanning and Processing of Examination Results is an Exempted Supply of Service:The applicant offers services for scanning and processing examination results. They argued that these services are integral to the conduct of examinations and should be exempt under the aforementioned notification. The Authority examined the relevant provisions and concurred with the applicant’s view, ruling that scanning and processing of examination results are exempt from GST.Conclusion:The Authority for Advance Ruling ruled affirmatively on all three queries raised by the applicant. The printing of pre-examination items, post-examination items, and the scanning and processing of examination results are all considered exempt supplies of service under Serial Number 66 of Notification No.12/2017-CGST[Rate] dated 28-6-2017, as amended. This exemption applies specifically to services related to the conduct of examinations provided to educational institutions as defined in the notification.