Educational services provided by institutions, including coaching fees, are exempt from GST according to relevant notifications and clarifications under the GST framework.

ORDER :

1. The petitioner, which runs institutions imparting higher secondary education and education recognized as “qualification” in law, has called in question the third respondent's order dated 17.06.2023 under the provisions of Sections 73 , 50(1) and 122 of the Karnataka Goods and Service Tax Act/Central Goods and Service Tax Act, 2017 [for short, 'KGST/CGST Act, 2017'] read with Rule 142(5) of the Karnataka Goods and Service Tax Rules, 2017 [for short, 'KGST Rules'].

2. Sri V. Raghuraman, the learned senior Counsel for the petitioner, submits that the petitioner's grievance is with the third respondent's reading of the expressions “educational institution” and “exempted service” for the purposes of the Notification dated 28.06.2017 in No. 12/2017 [for convenience, is referred to as “the Notification dated 28.06.2017”] and the conclusion that the fee collected by the petitioner from its enrolled students to extend the benefit of coaching for entrance examination and other educational services would not be exempted service. Smt. Jyoti M. Maradi, the learned High Court Government Pleader for the respondents, is heard in the light of this grievance for final disposal and the records are perused.

3. The third respondent has observed that the petitioner has charged its students (1) the following amounts, which are hereinafter commonly referred to as 'coaching fees':

(1) However, the third respondent has opined that the amount collected as “application fee” and for prospectus are exempted under Sl. No. 66 of the Notification dated 28.06.2017:

[a] Tuition fees towards II PUC CET Crash & Coaching and CA-CPT Coaching.

[b] Training fees for providing certification courses & placement and training fee for JV- AIET.

[c] Penal fee/fine.

[d] Various Misc. Fees viz., towards Alva's Nudisiri event, abacus, students welfare fund, internet, damages to hostel mess property, library fee and college fees.

The third respondent, while observing that the amounts/fees charged to the prospective students for entrance or admission or eligibility certificate [including the fee charged for issue of Migration Certificates] are exempted under the entry in Sl.No. 66 of the Notification dated 28.06.2017 but not the coaching fees charged, and therefore, the petitioner must pay GST on such coaching fees. The third respondent's conclusion is based on two footings viz., its interpretation of “educational institution” as contained in Clause 2(y) of the Notification dated 28.06.2017 and reading of the Circular dated 03.08.2022 in No. 177/09/22-TRU.

4. The third respondent, relying upon the entry in SL No. 66 of the Notification dated 28.06.2017, the notification issued by the State Government on 29.06.2017 and 25.01.2018 and paragraph 4.2 of the Circular dated 03.08.2022, has observed that an educational institution for the purposes of exemption from GST would be:

(i) Pre-school education and education up to higher secondary school or equivalent.

(ii) Education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force.

(iii) Education as a part of an approved vocational education course.

The Third respondent based on this observation has opined that the term “educational institution” as clarified in sub-clause (aa) of paragraph 4.2 of the Circular dated 03.08.2022 covers institutions providing services by way of education as part of curriculum for obtaining a qualification recognized by any law for the time being in force, and that the expression “education as part of curriculum for obtaining qualification recognized by law” in paragraph 4.2 (aa) could only mean “such educational services which are for impar