Applicability of GST exemption under Entry 66(a) to clinical postings provided by a specialised hospital/educational institution to students of another educational institution

[Mith Moh]

ABC is a specialised oncology hospital and educational institution for certain recognised courses and is affiliated/recognised by university and bodies such as NBEMS and NMC.

Students enrolled in recognised PG/medical programmes are required, as part of their prescribed curriculum, to undergo a mandatory clinical posting of in an oncology centre. The respective colleges/universities send their students to ABC.

ABC provides the required clinical exposure, access to its oncology facilities and related training. The consideration for the posting may be paid either by the concerned college/institution or by the student.

Question: Whether the fees collected by the Applicant for such mandatory clinical postings are exempt under Sl. No. 66(a) of Notification No. 12/2017-Central Tax (Rate) as "services provided by an educational institution to its students, faculty and staff", considering that:

1. the clinical posting is a mandatory component of a curriculum leading to a qualification recognised by law under paragraph 2(y)(ii) of the Notification;
2. the Applicant is itself an educational institution/recognised oncology institution for certain courses, but the students undertaking the posting are primarily enrolled with another University/college; and
3. the Applicant is providing only the specific clinical component required under the students' recognised curriculum, rather than conducting the entire degree/PG programme.

Does the expression "to its students" in Sl. No. 66(a) require the students to be formally enrolled with the Applicant, or can students placed with the Applicant for a mandatory component of their recognised curriculum be regarded as receiving educational services from the Applicant for purposes of the exemption?

Please refer ADVANCE RULING No. KER/17/2025 Dated 01.07.2025 which held that 102 government approved courses being part of Four Year Undergraduate Program is covered under Sl. No. 66(a) of Notification No. 12/2017-Central Tax (Rate)

[Sanjeev Agarwal]

Sl. No. 66(a) requires both: (1) education forming part of a curriculum leading to a qualification recognised by law under para 2(y)(ii), and (2) services provided by an educational institution "to its students."

ABC's mandatory oncology clinical posting can satisfy the first requirement where it is a prescribed component of a recognised medical/PG curriculum and ABC is an approved clinical training centre.

The difficulty is the "its students" condition. If students remain enrolled with another University/college and ABC merely provides clinical exposure, the Revenue may argue that they are not ABC's students.

However, full-degree enrolment with ABC is not expressly required. A defensible position exists where ABC is formally recognised/approved as part of the educational structure and students are officially posted/attached/registered with ABC for the prescribed clinical component, with ABC providing structured clinical training, supervision and attendance/assessment.

KER/17/2025 dated 01.07.2025 supports exemption where recognised/Government-approved courses form part of a recognised programme, but does not conclusively decide the separate "its students" issue.

The NBEMS judgment is adverse where persons receiving the service were not students of the institution, despite the activity being education-related.

Conclusion: The exemption is reasonably defensible if ABC has a formal academic/regulatory relationship with the students for the clinical component. If ABC merely receives students of another institution for mandatory postings without such formal relationship, the position is litigation-prone/high risk. The curriculum, approval/affiliation, posting orders and ABC's student/clinical records are therefore critical.

AI Summary

Mandatory clinical training may test GST exemption where students are enrolled elsewhere but receive recognised curriculum-based educational services.
GST exemption under Entry 66(a) is considered for mandatory clinical postings provided by a specialised oncology hospital and educational institution to students enrolled with other colleges or universities. The issue is whether curriculum-mandated clinical training, facilities access and related exposure supplied for a recognised medical or postgraduate qualification constitute services provided "to its students", despite formal enrolment elsewhere and despite the institution supplying only a specific clinical component rather than the entire programme.