GST of skill training services

[POOJA AGARWAL]

A society registered under section 12AA of Income Tax Act, 1961 provides vocation training services to students as per agreement with state government, and training fee is borne by state government. The Society being fully exempted from GST vide NN 12/20217 does not have GSTN and does not charge GST from the State Govt as well.

For providing such services the society has entered into an agreement with another private limited co, who on behalf of society, will provide such training services. Whether that private limited co. shall charge GST on Invoices issue to Society for providing such training services?

Please suggest

[Shilpi Jain]

Under GST, there has to be an exemption provided to any taxable supply for it not to be liable to GST.

Require further clarity on the course and its modalities to decide on the exemption.

However, there are certain recognised trainings that are exempt from GST. If this is no one of them , GST will be liable.

[PRAVEEN SHARMA]

The private limited company, when providing vocational training services to the society, must evaluate whether the services it offers are independently exempt under the GST law. If the services provided by the private limited company do not specifically fall under any exemption notification applicable to their activities, then the company would be required to charge GST on the invoices issued to the society for providing such training services.

It's important to note that the GST law's treatment of transactions between different entities depends on the specifics of the services provided and the nature of the entities involved. In this case, unless the services provided by the private limited company to the society are specifically exempted under any other entry of the GST exemption notifications, GST would be applicable on such services.

Regards, CA. Praveen Sharma

www.linkedin.com/in/capraveensh

+91-9871530610

[Padmanathan KV]

Prima facie, it appears from the query that the society is the implementing agency for vocational training and not the Pvt Ltd. In such case, Pvt Ltd will not be able to claim the benefit of exemption under S No 71 of NN 12/20217.

[KASTURI SETHI]

The crucial point is that  who is the service provider and who is service receiver and that can be ascertained only after perusing  the terms and conditions of the agreement  executed between the Private  Ltd. Co. and the Society. 

The terms and conditions can be determinant factor.

AI Summary

GST exemption depends on the actual supplier: private contractor must assess whether its training services are independently exempt before invoicing. Whether GST applies turns on the identity of the actual supplier and whether the private company's training services independently qualify for statutory exemption; exemptions attach to the supplier's taxable supply and, if no specific exemption applies, the private company should charge GST to the society. Contractual terms and factual allocation of roles determine supplier characterisation and exemption applicability.