TaxTMI 
TaxTMI 
2022 (8) TMI 864
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....to submit a bid in response to the tender floated by the Karnataka Textbook Society (hereinafter referred to as "KTBS") for the printing of school textbooks as prescribed by the Karnataka State Board. 3. The applicant has sought advance ruling in respect of the following questions: i. Whether KTBS can be classified as "educational institution" for the purposes of applicability of GST on printing services provided to it by the Applicant? ii. Alternatively, whether KTBS can be classified as "State Government" for the purposes of applicability of GST on printing services provided to it by the Applicant? iii. Whether the rate of tax being charged at present by the printers on the printing of textbooks supplied to KTBS i.e., @ 12%, is correct or whether any exemptions or lower rate of tax would be applicable on the said contracts for printing and supply of school textbooks. 4. Admissibility of the application: The question is about the "Applicability of a notification issued under the provisions of this Act", "determination of the liability to pay tax on any goods or services or both" and hence is admissible under Section 97 (2)) (b)&(g) of the CGST Act ....
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....h as paper, ink ex & transportation. There is consideration of value of goods & services Supplied by Contractor to KTBS. Hence the Event is taxable under GST Act. In the absence of any specific notifications granting exemption of GST on supply of goods and service of printing & supply of text books printed on contract basis by any contractor to KTBS, The contractor giving the service of printing to KTBS is a taxable event & is required to be taxed under GST Act at the applicable rate at the time of supply. Hence the Event of supply of service of printing & the physical Materials required for printing etc., at the hands of contractor / applicant M/ s Bhagyam Binding Works is taxable event only. 5.5 Also this office had addressed a letter to the Commissioner of Central Tax, Bengaluru West GST Commissionerate on 28-03-2022 to file comments on the application filed. In response to this, the Assistant Commissioner of Central Tax, West Commissionerate, Bengaluru has furnished comments as below: Query No. 1: Whether KTBS can be classified as "educational institution" for the purpose of applicability of GST on printing services provided to it by the applicant? Co....
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....hin the meaning and scope of supply and is a supply of services. Regarding the issue whether the services supplied by the applicant is exempted as per entries at SL No. 3, 4 or 5 of the Notification No. 12/2017-Central Tax (Rate), dated 28-06-2017 as amended. The entries at SL Nos. 3, 4 and 5 of the said notification reads as follows: "3 - Chapter 99 - Pure services (excluding works contract service or other composite supplies involving supply of any goods) provided to the Central Government, State Government or Union territory or local authority or a Governmental authority or a Government Entity by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution - Nil 4 - Chapter - 99 - Services by governmental authority by way of any activity in relation to any function entrusted to a Municipality under article 243W of the Constitution - Nil 5 - Chapter 99 - Services by governmental authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution - Nil....
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....r obtaining a qualification recognized by any law for the time being in force; (iii) education as a part of approved vocational education course;"; 6.1.2 As per the definition, an "educational institution" is not restricted to schools, which would be covered under (i), but also an institution which provides education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force. As such, KTBS is engaged in preparing and supplying textbooks to students, whether they are enrolled in a school or not, who are working towards obtaining the Secondary School Leaving Certificate (SSLC) upon completing the 10th Standard. 6.1.3 The applicant stated that the objective of KTBS is to provide free textbooks or paid textbooks to government and/or aided schools in accordance with the State Policy for Sarva Shikhsa Abhiyana. The textbooks are a key part, if not the most important aspect of obtaining the education which would make the students eligible for writing the exams for each class and the SSLC exam at the end of 10th standard, and thus obtaining a qualification recognized by the law in force. 6.1.4 The applicant stated that while ....
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....f; (ii) catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory; (iii) security or cleaning or house-keeping services performed in such educational institution; (iv) services relating to admission to, or conduct of examination by such institution: 6.1.9 The applicant is of the view that the service provided by way of printing of textbooks, which in turn are essential for the conduct of standardized examinations, for KTBS would therefore be covered under this definition. 6.2 The applicant submits that KTBS would fall within the ambit of "State Government" for the purposes of treatment under GST law: 6.2.1 KTBS was established by a Government Order promulgated to form an umbrella body in the context of preparation, printing and distribution activities of all Government-approved school textbooks. It is functioning under the Education Department, Government of Karnataka and is wholly financed by the Government of Karnataka. 6.2.2 The main objective of KTBS is to provide quality Textbooks to Primary and Secondary School students of the schools across the State of Karnataka in accordance ....
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....ority for Advance Ruling in the case of M/s. Kerala Books and Publications Society dated 05-01-2021 on a similar matrix of facts. 6.3 The applicant is of the view that KTBS ought to be treated as an "educational institution" or "State Government" and fall within the ambit of the definition of one of the said terms as defined for the purposes of treatment under GST law, then as per the Notifications quoted hereinabove, the services proposed to be provided by them to KTBS would be subject to Nil rate of GST and not 12% as is currently charged. PERSONAL HEARING / PROCEEDINGS HELD ON 26-04-2022 7. Sankari V. Krishnan, Advocate and Duly Authorised Representative appeared for personal hearing proceedings held on 26-04-2022 and reiterated the facts narrated in their application. FINDINGS & DISCUSSION 8. At the outset we would like to make it clear that the provisions of CGST Act, 2017 and the KGST Act, 2017 are in pari-materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corr....
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....e materials (physical inputs) are supplied by the applicant and all the content is provided by and belongs to KTBS. Circular No. 11/11/2017, dated: 20.10.2017 clarifies taxability of printing contracts as below: 1........................ 2........................ 3........................ 4. In the case of printing of books, pamphlets, brochures, annual reports, and the like, where only content is supplied by the publisher or the person who owns the usage rights to the intangible inputs while the physical inputs including paper used for printing belong to the printer, supply of printing of the content supplied by the recipient of supply is the principal supply and therefore such supplies would constitute supply of service falling under heading 9989 of the scheme of classification of services. 5. In case of supply of printed envelopes, letter cards, printed boxes, tissues, napkins, wall paper etc. falling under Chapter 48 or 49, printed with design, logo etc. supplied by the recipient of goods but made using physical inputs including paper belonging to the printer, predominant supply is that of goods and the supply of printing of the cont....