AAR Gujarat unable to determine GST exemption for Diamond Plan healthcare services due to insufficient documentation

The AAR Gujarat ruled that the applicant's Diamond Plan, offering healthcare services for 20 years through lump-sum payment, could not be determined for GST exemption eligibility under Notification No. 12/2017-CT. Despite the plan covering over 100 types of tests, sleep studies, naturopathy, dental care, and tie-ups with pan-India hospitals, the applicant failed to submit essential documents detailing service scope, terms, and tie-up arrangements. The AAR concluded that without proper documentation and complete disclosure of facts, it was impossible to determine whether the services qualified as exempt healthcare services under the notification.

---

---

Issues Involved:
1. Whether the lump-sum amount received for Health Care Services under the "Diamond Plan" for 20 years is exempted from Goods and Services Tax (GST) as per Sr. No. 74 of Notification No. 12/2017-Central Tax.

Issue-wise Detailed Analysis:

1. Definition and Scope of Health Care Services:
The applicant, M/s. Divyajivan Healthcare Private Ltd., proposed to establish a multi-super specialty hospital and provide health care services under a "Diamond Plan," which includes various health care services for a lump-sum amount of Rs. 10 Lakhs for 20 years. The services cover hospitalization benefits, annual preventive health check-ups, advanced health check-ups, special health care treatments, and privilege card benefits.

2. Exemption under Notification No. 12/2017-Central Tax:
The applicant argued that their services fall under the definition of health care services exempted from GST as per Sr. No. 74 of Notification No. 12/2017-Central Tax. The notification exempts health care services provided by a clinical establishment, an authorized medical practitioner, or para-medics.

3. Definitions under Notification No. 12/2017-Central Tax:
- "Authorized medical practitioner" means a medical practitioner registered with any recognized system of medicines in India.
- "Clinical establishment" means a hospital, nursing home, clinic, or any institution offering services for diagnosis, treatment, or care for illness, injury, deformity, abnormality, or pregnancy.
- "Health care services" include diagnosis, treatment, or care for illness, injury, deformity, abnormality, or pregnancy, and transportation of patients but exclude cosmetic or plastic surgery unless medically necessary.

4. Applicant's Argument:
The applicant contended that their services, provided under recognized systems of medicine (Allopathy), are exempt from GST. They emphasized that preventive health check-ups and treatments offered under the Diamond Plan qualify as health care services provided by clinical establishments or authorized medical practitioners.

5. Revenue's Submission:
The Assistant Commissioner of CGST & Central Excise Commissionerate, Surat, highlighted that the notification does not specify health care services provided for a specific time period under a health benefit scheme/plan. Additionally, an amendment in Notification No. 04/2022-C.Tax (Rate) restricts exemption for room charges exceeding Rs. 5000 per day.

6. Findings of the Authority:
The Authority examined the applicant's proposal and found that the Diamond Plan includes various tests, treatments, and privilege services. However, the applicant did not provide detailed documentation regarding the nature and characteristics of the services under the Diamond Plan. The absence of such documents made it impossible to determine whether the services qualify as health care services exempt from GST.

7. Conclusion:
Due to the lack of detailed documentation and clarity on the nature of services provided under the Diamond Plan, the Authority concluded that the application was not maintainable.

Ruling:
The application of the applicant is not maintainable.

---