Advance Ruling on Activity of Collecting Exam
Fees by Various Institutions.
Issue Involved & Brief about Applicant:
The Applicant (Arivu Educational Consultants Pvt Ltd.,) is a Private Limited Company engaged in providing coaching, learning and training services in relation to undergraduate, graduate and post graduate degree, diploma and professional courses on standalone bases to students or for any institution, corporate, company, institutes, universities and colleges in the subject and branches of all types of disciplines such as commerce, hardware, software, computer, science arts, business management, engineering, medical, sports and any other education and set up of coaching & training classes/centres in relation to the same.
In this process, the applicant collects certain amount as exam fee from the students and remits the same to the respective institute or college or universities without any profit element. In one such transaction the applicant collects CIMA exam fees from the
students registered with applicant for coaching and remits the exact amount collected to CIMA on behalf of the students. This payment is separately indicated in the invoice issued to the respective students.
Does the activity of collecting exam fee (charged by any university or institution) from the students and remitting to that particular university or institution without any value addition to it, amount to taxable services...???
AAR OBSERVATIONS AND FINDINGS:
The applicant is educational consultant and a professional in the field of education who uses his experience in teaching, to help with curriculum development and other issues those schools, organizations, and parents may face. The applicant conducts the training or coaching classes for the students, to guide or train or prepare them to take the exam in the respective institute or college or universities. It doesn’t have any specific curriculum and do not conduct any examination or award any qualification.
-The applicant collects fee for coaching or training classes they conduct from the students which attracts GST @18%. Apart from this the applicant also collects certain amount as exam fee from the students and remits the same to the respective intuition without any addition to it.
-The applicant is collecting the exact amount payable to the institute or college or universities exam fee from the students (Service recipient) and remits the same amount to the respective institute (third party) without any profit element or value additions, on authorization of students. This payment is separately indicated in invoice. The applicant providing this kind of services to the students in addition to the services as training and coaching institute.
-Hence, the applicant as narrated in the Rule 33 of the CGST Rules,
2017/Karnataka GST Rules.
Therefore, amount of fee collected by the applicant from the student as exam fee which is remitted to the respective institute or college is excluded from the taxable value of the applicant
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