2018 (10) TMI 301 – AUTHORITY FOR ADVANCE RULING, GUJARAT – 2018 (18) G. S. T. L. 144 (A. A. R. – GST) – Exemption from GST – training or coaching – recreational activities or not – UCMAS (Universal Concept Mental Arithmetic System) – The activity provided by UCMAS using abacus whether qualifies for exemption from the payment of GST?
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Held that:- As per Sl. No. 80 of Notification No. 12/2017-Central Tax (Rate) exempts services by way of training or coaching in recreational activities relating to arts or culture or sports. (In case of training or coaching in recreational activities relating to sports, exemption is admissible only when such services are by charitable entities registered under section 12AA of the Income-tax Act) – The words ‘recreational activities’ and ‘arts’ have not been defined in the GST Acts or Notifications issued thereunder.
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As per the dictionary meaning, ‘Art’ is the expression or application of human creative skill and imagination, typically in a vis
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interest in students for more advance form of mathematics so as to enhance their thinking capacity and mental development or employing methods of play involving Musical, Visual and specialized effects does not make the activities of the applicant as the training or coaching in recreational activities.
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Ruling:- M/s. Omnisoft Technologies Private Limited is not entitled to the exemption provided vide Sl. No. 80 of Notification No. 12/2017Central Tax (Rate) dated 28.06.2017 issued under the CGST Act, 2017 and corresponding Notification issued under the GGST Act, 2017 and Sl. No. 83 of Notification No. 9/2017-Integrated Tax (Rate) issued under the IGST Act, 2017. Hence the activity provided by UCMAS using abacus does not qualify for exemption from the payment of Goods and Services Tax. – GUJ/GAAR/R/2018/15 (IN APPLICATION NO. Advance Ruling/SGST&CGST/2017-18/AR/24) Dated:- 23-8-2018 – R.B. MANKODI AND G.C. JAIN, MEMBER Present for the applicant : Shri Dhruvank Parikh, CA The applic
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ndia to the applicant. It is submitted that UCMAS is a progressively leveled program, wherein students in the age group of 4 to 13 years join in and take about 3 years to complete the program. There are ten levels in the Basic program route (Basic, Elementary A & B, Intermediate A & B, Higher A & B, Advance, and Grand A & B). For those joining the KG program route there are 12 levels (KG 1 to 4, Elementary B, Intermediate A & B, Higher A & B, Advance, Grand A & B). Each level is of approximately 3 months and students need to come to the center once a week for a 2 hour session. They need to practice for about 30 minutes daily when they are home for the next 6 days. 2.2 It is submitted that UCMAS is a child development program based on Visual Arithmetic and Abacus that boosts brainpower in children aged 4-13 years. Along with strengthening math skills, the UCMAS approach promotes whole brain development and establishes foundational building blocks like memory,
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uild on them progressively throughout grade school. These crucial skills will enable a child to process sensory information and eventually learn to evaluate, analyze, remember, make comparisons and understand cause and effect. Although some cognitive skill development is related to a child's genetic makeup, most cognitive skills are learned. That means thinking and learning skills can be improved with practice and the right training. It is submitted that UCMAS promotes whole brain development by stimulating both sides of the brain using an innovative mental arithmetic program utilizing the Abacus as a teaching tool. By learning to perform mental calculations quickly and accurately, students aged 4-13 expand their mental capacity and develop skills such as multitasking, time management, memory, concentration and problem solving – skills that are crucial to success in all areas of study and in daily life. It is submitted that UCMAS not only leads to greater student proficiency and co
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n 9, sub-section (1) of Section 11, sub-section (5) of Section 15 and sub-section (1) of Section 16 of Central Goods and Service Tax Act, 2017, notifies different rates of Central GST applicable to supply of recreational, cultural and sporting services supplied in the course of intra-state supply of the said services. Similarly the levy of State Tax on the said supply is governed by Notification No. 11/2017- State Tax (Rate) dated 30th June, 2017 issued by the Government of Gujarat. Corresponding description finds mention in Notification No. 08/2017-Integrated Tax (Rate) dated 28thJune, 2017 when the services are supplied in the course of inter-state supply of the said services for determining the rate of Integrated Tax applicable to the said services. 4.2 It is submitted that Entry No. 80 containing Heading 9996 in Notification No. 12/2017-Central Tax (Rate) dated 28th June, 2017 issued by the Central Government exempts the levy of Central Tax on the Intra-State Supply of Services by
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ntioned herein above. 4.4 It is submitted that UCMAS Training or Coaching Services provided by the applicant falls under the category of a Recreational Training Service/Activity. The word recreational activity has not been defined in the GST Act specifically. Although, several definitions can be derived for the word Recreational / Recreation through various dictionaries available either in print or in online version. 4.5 The applicant submitted that the UCMAS approach promotes whole brain development and establishes foundational building blocks like memory, concentration, creativity and problem solving – core skills that inspire greater confidence and success in life. Therefore, if certain specialized training is provided to make career in a particular field, and also the course involves specific certification from the institute rendering such training, then the facilitation of such education falls under the ambit of Recreation and development through various unique techniques (can als
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students. The training imparted is optional and the child is at discretion, whether to opt for it or just continue with his/her regular studies. 4.7 It is submitted that Recreation should not be confined to playing games or watching television. There are a variety of activities which could be called as recreational. Even though, a vast majority of students do not find mathematics or arithmetic very interesting, by employing special methods, the subject which some consider as drudgery can be made interesting and thereby recreational. There are many games which can be played by using mathematics and mathematical concepts. Under UCMAS, the applicant applies various methods to make learning of arithmetical skills enjoyable. 4.8 It is further submitted that Abacus taught under UCMAS which is a recreational activity relates to an art. Art has again not been defined in the GST Act. ABACUS under UCMAS is not merely a method to improve the speed and accuracy of calculations but it is also an ac
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This comes from the need to understand the theoretical requirements of each calculation and at the same time be aware of the time, and prompting from the teachers. By using the imaginations of the right brain to visualize the abacus in mind, inevitably the powers of visualization would become sharp and clear. Albert Einstein believes that the imagination is important than knowledge, because imagination is the main source of yet to be discovered knowledge. Memory is the ability to store and retrieve the information and experiences. It has been found that the memory in the left brain would not stay long, but an image that is recorded in the right brain would stay on in the mind forever. By stimulating the right brain with mental arithmetic, and in combination with the alertness of the eyes, ears and hands, the ability to store and recall develops together. 4.9 From the above, the applicant submitted that Training Activity performed by the company under UCMAS using Abacus is a recreationa
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ST/29/2006) = 2009 (5) TMI 70 – CESTAT, BANGALORE, K.K. Academy Pvt. Ltd. Vs. Commissioner of Service Tax, Chennai (Final Order No. 1075-1076/2011 dated 07.07.2011 in Appeal Nos. ST/226/2007 and ST/10/2008) = 2011 (7) TMI 506 – CESTAT, CHENNAI and Abacus Brain Study (P) Ltd. Vs. Commissioner of Central Excise (A), Hyderabad (Final Order No. 63/2011 in Appeal No. ST/349/2010) = 2011 (1) TMI 833 – CESTAT, BANGALORE. 5.2 The applicant submitted that above verdicts of different judicial forums were based on notifications no more in existence, however the analogy and intention of the Government in the Notifications existing / prevailing in the current context seems similar considering the fact that the explanations to the earlier notifications being existed prior to introduction of negative list reflected the intention of the Government to provide exemption to commercial coaching institutes being qualified as recreational one and the meaning thereof according to government was clarified by
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ainst by the department before Hon ble Supreme Court through Civil Appeal Nos. 2558-2559 of 2012, which have been admitted by the Hon ble Supreme Court on 24.02.2012 and are pending for decision. 6.2 It has been further opined by the Vadodara – I Commissionerate that activity of the applicant cannot be called as art. As per oxford dictionary, art is the expression or application of human creative skill and imagination, typically in a visual form such as painting or sculpture, producing works to be appreciated primarily for their beauty or emotional power. Thus, Art is commonly used to describe something of beauty, or a skill which produces an aesthetic result. 6.3 It has been opined by the Vadodara – I Commissionerate that the activity performed by the applicant is a form of education imparted to the children to develop their interest and skills in mathematics and hence it is an education support service. It is submitted that it is not a system purely based on abacus , which is used to
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also considered the views of the Central Goods and Services Tax Commissionerate, Vadodara – I. 8. The issue involved in this case is regarding admissibility of exemption provided vide Sl. No. 80 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 issued under the Central Goods and Services Tax Act, 2017 (herein after referred to as the CGST Act, 2017) and corresponding Notification No. 12/2017-State Tax (Rate) dated 30.06.2017 issued under the Gujarat Goods and Services Tax Act, 2017 (herein after referred to as the GGST Act, 2017 ) or Sl. No. 83 of Notification No. 9/2017-Integrated Tax (Rate) issued under the Integrated Goods and Services Tax Act, 2017 (herein after referred to as the IGST Act, 2017 ) to the supply of services being made by the applicant. 9.1The said Sl. No. 80 of Notification No. 12/2017-Central Tax (Rate) reads as follows :- Sl.No. Chapter, Section, Heading, Group or Service Code (Tariff) Description of Services Rate (per cent.) Condition 80 9996 Servic
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y of calculations or development of mental capabilities, such as, concentration, observation, visualization, imagination and memory cannot be said to fall within the meaning of Art . 9.5 It will also be useful to refer to services covered under Heading 9996 – Recreational, Cultural and sporting services and more specifically Group 99962 – Performing arts and other live entertainment event presentation and promotion services and Group 99963 – Services of performing and other artists as per the scheme of classification of services prescribed vide Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, which are reproduced below. Heading & Group Service Code (Tariff) Service Description Heading No.9996 Recreational, cultural and sporting services Group 99961 Audiovisual and related services ……… Group 99962 Performing arts and other live entertainment event presentation and promotion services 999621 Performing arts event promotion and organization services 99
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er the GGST Act, 2017 and Sl. No. 83 of Notification No. 9/2017-Integrated Tax (Rate) issued under the IGST Act, 2017 is not admissible to the activities of the applicant. 10. Further, the training imparted by the applicant to create interest in students for more advance form of mathematics so as to enhance their thinking capacity and mental development or employing methods of play involving Musical, Visual and specialized effects does not make the activities of the applicant as the training or coaching in recreational activities. 11. The decisions of Hon ble CESTAT referred to by the applicant pertain to Notification No. 9/2003-Service Tax and 24/2004-Service Tax issued under the Finance Act, 1994 (Service Tax), which are not pari-materia to Sr. 80 of Notification No. 12/2017-Central Tax (Rate). Further, against the decision of Hon ble CESTAT in the case of Abacus Brain Study (P) Ltd. (supra), Civil Appeal Nos. 2558-2559 of 2012 have been filed in the Hon ble Supreme Court, which are
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