Coaching classes don’t get any exemption from Goods & Service Tax (GST), this position was reiterated by a ruling given by the Andhra Pradesh bench of the Authority for Advance Rulings (AAR). A similar stand has been taken earlier, including by the Maharashtra bench of the AAR.
Entry No 66 of the relevant notifications provides an exemption to educational services, if these are provided by an educational institution, subject to certain conditions. These are: the service provided is related to education, the education is provided as a part of a curriculum & the education is provided for obtaining a qualification recognised by any law for the time being in force.
The applicant, Master Minds, was offering a variety of coaching courses (regular, crash courses, revision exam courses) with different fee structures & curriculum options to aspirants (students) of chartered accountancy & cost accountancy streams.
The AAR bench noted that such coaching is not mandatory to be conferred an Inter or Final certificate by the Institute of Chartered Accountants & the Institute of Cost Accountants, both of which are statutory bodies.
The coaching class wasn’t issuing any coaching completion certificate or any study certificate, in respect of the chartered accountancy & cost accountancy courses.
Master Minds wasn’t accredited or affiliated to, or recognised, or authorised by these 2 professional Institutions for imparting coaching or training. These professional institutions were themselves offering coaching & training to the aspirants through their regional councils or branches or certain accredited bodies, in accordance with the prescribed curriculum.
Given the above, the AAR held that the coaching class wasn’t eligible for the exemption provided by the GST notification. The coaching class will have to levy & collect GST at 18 per cent. Likewise, charges collected for providing accommodation & catering services to its students would not get the benefit of any GST exemption.