GSTAT Delhi: Affiliation fees are not covered under exemption for services relating to admission or examinations

OTU Case ID: 2026/onlinetaxupdate/1002

The GST Appellate Tribunal’s order in the case of the Council for the Indian School Certificate Examinations (CISCE) vs. CGST Delhi East clarified that CISCE’s activities—such as granting affiliation, processing affiliation forms, and charging annual registration and late registration fees—constitute taxable supplies under the GST Act. The Tribunal held that these services are not exempt as ‘services relating to admission to, or conduct of examination’ under the relevant GST exemption notification, since they are administrative and regulatory in nature, provided to schools (not directly to students), and are not directly linked to the conduct of examinations. However, documentation charges and late entry fees, being directly related to examination processes, were found to be exempt, and licence fees for publishing syllabus/question papers fall under reverse charge, not CISCE’s liability.

The Tribunal set aside the GST demand and penalties for the period July 2017 to August 2018, finding that the extended limitation period under Section 74 was not validly invoked due to lack of evidence of fraud or willful suppression. For the period from 18 June 2021 to November 2023, the Tribunal upheld the GST demand on affiliation and registration-related fees, but allowed the benefit of treating all amounts collected as inclusive of GST (cum-tax benefit), since CISCE had not collected GST separately. Penalties and interest were sustained only for the confirmed tax demands in this later period. The Tribunal also confirmed that CBIC circulars clarifying the taxability of affiliation services are valid and binding, and that the regularization of GST liability for the earlier period (up to June 2021) applies only to affiliation services, not to annual registration or late charges.

Courtesy: AI generated summary