The Karnataka Authority for Advance Ruling (AAR) in its recent ruling on the application filed by M/s Datacon Technologies has ruled that services of scanning of OMR flying slip, marks foil, attendance sheet and absentee sheet along with data extraction and finalization for Bihar School Educational Board would be exempted from GST.
Facts of the case:
The Applicant, M/s Datacon Technologies are a leading service provider in respect of Print solutions and infrastructure services, which provide services all over the country.
They also provide services in respect of examination matters of various Boards and Universities & the said services include Offset and Digital Print Solutions; Variable Data Printing; Security featured Print Stationery; Printing of OMR technology forms; Scanning, Editing, and processing of OMR and ICR technology forms; Data mining and Data Management Result processing and Report Generation and other allied IT infrastructure services including hardware and Maintenance services.
The applicant caters to the Education vertical in terms of stationery items for the conduct of examination and post-examination process such as Marks card/Certificates etc.
They were awarded a contract by the Bihar School Education Board (BSEB) for scanning of OMR Flying slip. OMR Marks Foil. OMR attendance sheet, OMR absentee sheet, and finalization of data.
Issues on which ruling was sought:
Whether the services performed by them are exempted by virtue of item (b) of Sr. No. 66 of Notification No. 12/2017 dated June 28, 2017.
For ready reference of our readers item (b) of Sr. No 66 of above Notification is reproduced below:
Services provided –
(b) to an educational institution, by way of, –
(iv) services relating to admission to, or conduct of examination by, such institution.
Applicant’s interpretation of law:
Bihar State Education Board (BSEB) is an educational institution and their services are in relation to conduct of examination and hence exempted from GST, in terms of item (b) of Sl. No 66 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. Further Maharashtra AAR in the case of M/s Orient Press Ltd , wherein identical service was held to be exempted from GST.
Order of Karnataka AAR: Deliberation and Ruling
- The Notification No.14/2018-Central Tax (Rate) dated July 26, 2018 inserted a clarification in Notification No.12/2017-Central Tax (Rate) dated June 28, 2017 that the Central and State Educational Boards shall be treated as Educational institutions for the limited purpose of providing services by way of conduct of examination to the students. Thus, the BSEB becomes an Educational institution for the purpose of conduction of examination, in terms of the Notification.
- It was observed from the letter of BSEB, submitted by the applicant containing reference of work order that the applicant was given the job to scan the OMR Flying slip. OMR marks Foil with barcode sticker, scanning of OMR attendance sheet, and scanning OMR Absentee sheet along with data extraction and finalization of data in all the four categories.
- It is an undisputed fact that the process of conducting the examination is not limited or restricted to a test center. Examination is an incomplete activity without assessment. Scanning of answer sheets and quantifying marks is an essential part albeit the main objective of the examination process. Educational institutions or the examinees do not look at these activities in isolation.
In view of above deliberations the two-member bench consisting of of Dr. Ravi Prasad M.P. and Mashood ur Rehman Farooqui held as under:
The activity of the applicant is covered under “Other Educational Support Services” under SAC 999299, and is related to conduct of examination and hence is exempted by virtue of Sr. No.66 of Notification No.12/2017-CT (R) dated June 28, 2017.
READ / DOWNLOAD ORDER [ NO LOGIN / SUBSCRIPTION REQUIRED]
***
[rainbow]Don’t miss the next GST Update / Article / Judicial pronouncement[/rainbow]
Subscribe to our newsletter from FREE to stay updated on GST Law
Resolve your GST queries from national level experts on GST free of cost.
Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.
