GST on university affiliation fees fails where the charges are statutory, not commercial consideration, and educational exemption applies.

GST could not be levied on affiliation and allied fees collected by a university because its affiliation, registration, admission, convocation and related functions were statutory and regulatory, not commercial supplies in the course or furtherance of business under the CGST Act. The fees were treated as statutory levies rather than consideration, since they lacked the contractual element and quid pro quo required for a taxable supply. The educational institution exemption under Entry 66 of Notification No. 12/2017-CT (R) also applied to the services in question. On that reasoning, the GST demand was unsustainable and the adjudication order was quashed.

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Issues: Whether the impugned adjudication order demanding GST on affiliation and allied fees collected by the University was liable to be quashed.

Analysis: The determination turned on whether the University's activities amounted to a supply made for consideration in the course or furtherance of business under Section 7 of the CGST Act, 2017, read with the definition of business in Section 2(17) and consideration in Section 2(31). The Court followed the coordinate bench view that the University's affiliation, registration, admission, convocation and related functions are statutory and regulatory in nature, not commercial activities. It further accepted that such fees are statutory or regulatory levies, lacking the contractual element and quid pro quo required for consideration, and that the educational institution exemption in Entry No. 66 of Notification No. 12/2017-CT (R) dated 28.06.2017 covers the services in question.

Conclusion: The GST demand could not be sustained and the impugned adjudication order was liable to be quashed.

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