Strict construction of education tax exemption denied relief where qualification and vocational course conditions were not proved.

Entry No. 66 of Notification No. 12/2017-Central Tax (Rate) exempts educational services only where the provider qualifies as an educational institution under paragraph 2(y), namely by offering pre-school to higher secondary education, education forming part of a curriculum leading to a qualification recognised by law, or education under an approved vocational education course. The AAR held that the applicant did not produce sufficient material to show that its courses formed part of a legally recognised qualification curriculum, and did not establish the specific requirements for the vocational education route, including registration with the Directorate General of Training for the relevant Modular Employable Skill Course pathway. Exemption notifications are strictly construed, and the burden rests on the claimant to prove entitlement.

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Issues: Whether the educational courses conducted by the applicant are eligible for exemption under Entry No. 66 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Analysis: Exemption under Entry No. 66 is available only if the service provider falls within the definition of an educational institution under paragraph 2(y) of the notification, namely an institution providing pre-school education up to higher secondary level, education as part of a curriculum for a qualification recognised by law, or education as part of an approved vocational education course. The applicant did not produce sufficient material to establish that its courses are part of a curriculum leading to a qualification recognised by law. For the vocational education limb, the notification contemplates only courses covered by paragraph 2(h), and the applicant did not show that it satisfied the specific requirement of registration with the Directorate General of Training for the relevant Modular Employable Skill Course route. In interpreting the exemption, strict construction applies and any ambiguity cannot be resolved in favour of the claimant.

Conclusion: The courses conducted by the applicant do not qualify for exemption under Entry No. 66 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Ratio Decidendi: Exemption notifications must be strictly construed, the assessee bears the burden of proving entitlement, and any ambiguity in the exemption must be resolved against the claimant.

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