Aggregator of Third-Party Diagnostic Services is Covered Under Healthcare Services | AAR

Case Details: Medpiper Technologies (P.) Ltd., In re - [2025] 173 taxmann.com 195 (AAR-KARNATAKA)

Judiciary and Counsel Details

• Kiran Reddy T., Member (Central Tax) & Prathap Kumar S, Member (State Tax)

Facts of the Case

The applicant, acting as an aggregator of diagnostic and wellness services, approached the Authority for Advance Ruling (AAR), Karnataka, seeking a ruling on GST applicability. The applicant entered into contracts with companies, insurance firms, or brokers to arrange diagnostic and wellness services for employees or designated groups through third-party service providers. User interaction occurred via the applicant’s mobile app, WhatsApp, email, or phone. Diagnostic labs issued medical reports directly to beneficiaries. The applicant aggregated service providers, provided workflow tools, offered standard pricing, collected payments from clients, disbursed payments to labs, and retained a margin. Invoices were first raised by the labs on the applicant, and subsequently by the applicant on the client with markup. The applicant sought clarity on whether GST was payable only on the margin or on the full invoice value.

AAR Held

The Hon’ble AAR, Karnataka, held that the applicant was not acting as an agent of the client or of the diagnostic labs but was supplying services on its own account. The services provided by the applicant were held to be ‘healthcare services’ under Heading 9993. The applicant was not a clinical establishment, but an aggregator procuring such services from third-party labs. Applying Section 15(1) of the CGST Act, the AAR ruled that the applicant must charge GST on the entire invoice amount, being the transaction value, and not merely on the markup. The applicable GST rate was 18% under Section 9 of the CGST Act and the Karnataka GST Act. Accordingly, GST was payable on the full value of diagnostic and wellness services facilitated through third-party providers.