DGCA-Approved Pilot Training Qualifies as Educational Service: Allahabad HC Remits Service Tax Matter for Re-Adjudication [Read Order]
The Court noted a clarificatory circular issued by the Ministry of Finance in October 2024, which recognised such training as exempt under GST
DGCA, Allahabad High Court, Pilot Training, Educational Service
DGCA, Allahabad High Court, Pilot Training, Educational Service
The Allahabad High Court, in a recent ruling, remanded a GST (Goods and Services Tax) exemption dispute involving CAE Simulation Training Pvt. Ltd., holding that DGCA-approved pilot training qualifies as an educational service
CAE Simulation, a joint venture between CAE Middle East Holding Ltd. and InterGlobe Enterprises Pvt. Ltd., operates as a DGCA-approved training organisation for commercial pilots.
The company provides simulator-based training for Aircraft Type Rating (ATR) extensions, which are mandatory under India’s civil aviation regulations.
The training is conducted in accordance with a curriculum approved by the Directorate General of Civil Aviation (DGCA), and successful candidates receive course completion certificates.
The petitioner had applied for an advance ruling under Section 97 of the CGST Act, 2017, seeking clarity on whether its services were exempt under Notification No. 12/2017-Central Tax (Rate).
This provision exempts services provided by “educational institutions” to students, faculty, and staff. However, the AAR denied the exemption, stating that CAE did not meet the definition of an educational institution under the notification.
Represented by counsel, CAE argued that its training services were part of a curriculum recognised by law, as mandated by the Aircraft Act, 1934, and the Aircraft Rules, 1937.
The petitioner relied on multiple judicial precedents, including rulings from the Delhi High Court and the Central Excise Tribunal, to support its claim.
Most notably, it cited a clarificatory circular issued by the Ministry of Finance on October 11, 2024, which explicitly recognised DGCA-approved flying training courses as exempt under GST.
The circular clarified that institutions approved by DGCA, which issue course completion certificates under the Aircraft Act and Rules, fall within the scope of “educational institutions” under the GST law.
It was stated that such training is a prerequisite for obtaining commercial pilot licenses and is therefore recognised by law.
The bench of Justice Rohit Ranjan Agarwal set aside both the original order by the AAR dated and the appellate order. It was directed that the AAR reconsider the matter in accordance with the clarificatory circular.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
