R&D services funded by grant treated as supply under Section 7 CGST; exemption denied for missing s.35(1) proof

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....AAR held that the R&D activity performed by the applicant for a Government research institution under a grant-in-aid arrangement constitutes a "supply" under Section 7 of the CGST Act, notwithstanding absence of IP transfer, because the activity was performed for consideration. Although Notification No. 08/2024 inserts an exemption for R&D services funded by grants to specified notified institutions, the applicant failed to establish notification under clauses (ii)/(iii) of s.35(1) of the Income-tax Act; consequently the services do not fall within Entry Nos. 3 or 3A of Notification No. 12/2017. The partial manufacture of samples does not engage Articles 243G/243W functions. The supply is taxable and the applicant is liable to discharge GST at the applicable rate.....