Karnataka’s Authority for Advance Ruling (AAR) has said that income earned from conducting guest lectures will attract Goods & Services Tax (GST) at the rate of 18 per cent.
The applicant, Sairam Gopalkrishna Bhat, is a Law Professor at the National Law School, Bengaluru.
He moved AAR to seek advance rulings on whether income earned from conducting guest lecturers wastaxable. He also enquired whether the income earned from research training projects funded by Central and State Ministries will attract GST. AAR noted the ruling by the Supreme Court in the matter of Loka Shikshana Trust where ‘education’ was defined as a process of training and developing knowledge, skill and character of students by normal schooling.
After going through all the arguments and facts, AAR mentioned that services by way of training or coaching in recreational activities relating to arts or culture or sports by charitable entities are exempted from GST. “The applicant is providing guest lectures on law and legal awareness and not on arts and culture,” it said while adding that exemption plea for guest lecturers is not tenable.
The AAR said that services provided by the applicant are covered under “other professional, technical and business services,” and hence attract GST at the rate of 18 per cent. In response to the other query posed, AAR highlighted that services provided to the Centre, State government, Union Territory Administration, under any training programme for which total expenditure is borne by the Centre/State/UT will attract ‘NIL’ GST, but only after fulfilling two conditions.
Conditions for exemption
The first condition is that training services are to be provided only to the Centre, State Government and Union Territory Administration. The second condition is that expenditure has to be borne by the Centre, State Government and Union Territory Administration.
AAR noted that the applicant has provided a copy of MoU signed between Central Environment Ministry and Centre for Environmental Law, Education, Research and Advocacy (CEERA) of the National Law School. “But there is no privity of contract between the Central Ministry and the applicant,” AAR said, while adding the said service is not covered under the notification. This means training services provided by the applicant will attract GST at the rate of 18 per cent.