TaxTMI 
TaxTMI 
2024 (9) TMI 243
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.... explanation was sought from the appellant vide letter dated 20.12.2017, 23.05.2018, 06.06.2018 and 21.08.2018 on receipts from Life Care Medicos. The appellant failed to appear and only submitted its response vide letter dated 06.09.2018. 3. Show cause notice dated 8.9.2020 was issued on the ground that during the period 2015-2016 to June 2017 the appellant had not paid the service tax of Rs.9,23,665/- on the amount of commission received from M/s Life Care Medicos and failed to declare the said amount in their service tax returns. On adjudication, the demand under the SCN was confirmed and the appeal filed by the appellant was dismissed by the impugned order. Hence the instant appeal has been filed before this Tribunal. 4. Heard Ms. Priyanka Goel, Advocate for the appellant and Shri Rohit Issar, Authorised Representative for the respondent. 5. The learned Counsel for the appellant has taken the preliminary issue challenging invocation of the extended period of limitation, however, I feel that it is appropriate to first consider the issue on merits. The submission on merits are as under:- A. The appellant is running a hospital and providing various medical servic....
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.... involved is relating to the in-house patients, who have cashless medical insurance facility. The appellant having provided the medical treatment, process the medical claim of the patient through the insurance company. Such medi-claim includes hospital room charges, doctor fees, nursing care charges and also the medicine charges. Once the claim is settled and the amount is reimbursed by the insurance company including the value of medicines supplied by the Medical store for the treatment of the patient, the appellant retains some part from the reimbursed amount on account of 'service charges' and after deducting the said amount the remaining amount due to the medical store is paid. The claim of the appellant is that for preparing the Mediclaim considerable time of the staff is consumed for which they are taking the service charges from the medical store from whom the medicines were received. The contention of the appellant is that these charges are nothing but part and parcel of the healthcare services which is their primary function. 9. To further appreciate the controversy the scheme of the statutory provisions applicable is required to be considered. During the period 1.7.201....
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....health care services. In other words, the provision for medicines is inbuilt in health care service and the treatment. 12. Medical aid to the patients who are admitted in the hospital, most of the time requires urgent care and treatment without any loss of time and that is the reason for having a medical store within the vicinity of the hospital. The moment a patient is admitted, with the immediate diagnosis is required to be normalised by commencing the treatment with the medicines and thereafter their continuous stay in the hospital requires constant administering of the medicines. Therefore, the in-house patients are largely dependent on the medicine shop in the hospital. In this scenario the hospital which is providing the multifarious services under the health care services owes greater responsibility that the medicines which is the most important input in any treatment are available to the patients urgently on time and simultaneously the payment thereof to the medicine shop is also made, for which the hospital is required to assimilate the claim in respect of all the services rendered to the patients and forward them to the insurance company. The matter does not ends here,....
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....ribunal took the view that it is a mutually beneficial arrangement of having the revenue sharing model, where the doctors are attending to the patients for treatment using his professional skills and knowledge and the hospitals are managing the patients from the time they enter the hospital till they leave the premises. The appellant hospitals also manages follow-up procedures and provide for further health care services in the manner as required by the patients. The appellant hospitals are availing the professional services of the doctors for providing health care services, for which they are paying the doctors. However, the retained money out of the money charged from the patients is also for such heath care services. Noting the definition of the 'Clinical Establishments" and "Health Care Services", as defined in the Notification No.25/2012-ST, the Tribunal observed as under:- "11. These two provisions available in Notification No. 25/2012 will show that a clinical establishment providing health care services are exempted from service tax. The view of the Revenue that in spite of such exemption available to health care services, a part of the consideration received for s....