The Karnataka Authority of Advance Ruling (AAR) ruled that 18% GST is applicable on support services for research on the Prevention of Epilepsy.
The applicant, M/s.Vevaan Ventures has not obtained registration under the GST Act, 2017. The principal object of the firm is to carry out clinical research activities in India to determine the safety and effectiveness (efficacy) of medications, devices, diagnostic products and treatment regimens intended for human use.
The applicant has sought advance ruling in respect of the various questions.
Firstly, the advance ruling was sought in respect of the SAC applicable to the activities undertaken by M/s Vevaan Ventures.
Secondly, whether the exemption given under Notification No. 9/2017- Integrated Tax (Rate) dated 28.06.2017 is applicable to the applicant.
Thirdly, whether the applicant can avail input tax credit of tax paid or deemed to have been paid.
Fourthly, whether the applicant is liable to pay tax on outward services, if yes, at what rate.
Fifthly, whether the applicant is required to be registered under the Act.
The coram consists of Dr. Ravi Prasad and Mashood Ur Rehman Farooqui held that the services provided by the applicant, as explained earlier is not in connection with the diagnosis or treatment or care for illness and is related to support services for research and is covered under SAC 998599 and hence is not covered under healthcare services and thereby not covered under entry no. 74 of Notification No.12/2017- Central Tax (Rate) dated June 28, 2017.
The Authority ruled that the services provided by the applicant, as explained earlier is not in connection with the diagnosis or treatment or care for illness and is related to support services for research and is covered under SAC 998599 and hence is not covered under healthcare services and thereby not covered under entry no. 74 of Notification No.12/2017- Central Tax (Rate) dated June 28, 2017.
Since the services provided by the applicant is not exempt, the applicant is eligible to claim and avail input tax credit in terms of section 16 of the CGST Act, 2017 and section 16 of the KGST Act, 2017, the AAR added. “Since the applicant is involved in the intra-State supply of services, as the location of the supplier and the place of supply is the same state, the applicant is liable to register as per the terms of section 22 of the CGST Act, 2017,” the AAR said.
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