Inspection Fee and Affiliation Fee Charged by Universities From Colleges is Not Exempt Under GST | HC

Case Details: Care College of Nursing and others vs. Kaloji Narayana Rao University of Health Sciences - [2023] 156 taxmann.com 450 (TELANGANA)[17-10-2023]

Judiciary and Counsel Details

• • P. Sam Koshy & Laxmi Narayana Alishetty, JJ.
  • Gaddam Srinivas for the Petitioner.
  • V. Rajeshwar Rao for the Respondent.

Facts of the Case

The University, for the purpose of granting affiliation to the colleges, first conducts inspection of the Colleges. For the same, it charges inspection fees and also, affiliation fees. The petitioner contends that the inspection and affiliation would be covered under the exemption granted under GST to the educational institutions.

High Court Held

In this regard, the High Court noted that the exemption entry in respect of educational services is restricted to the extent the services are provided to the students, staff, and faculty. It does not deal with the services rendered by the university to the educational institutions. ‘Affiliation’ and ‘inspection’ is a service rendered by the university to the educational institutions for which the university had charged the respective educational institutions.

Hence, the High Court held that where the exemption entry is required to be strictly construed and as the impugned services are not specifically contained in the exemption notification, these would remain taxable under the GST Act.