I am directed to invite your attention tothe Indian Institutesof Management Act, 2018 which came into force on 31st January, 2018. According to provisions of the IIMAct,all the IIMs listed in the schedule to the IIM Actare “institutions of national importance”. Theyare empowered to (i) grant degrees, diplomas, and other academic distinctions or titles, (ii) specify the criteria and process for admission to courses or programmes of study, and (iii) specify the academic content of programmes. Therefore, with effect from 31st January, 2018, all the IIMs are “educational institutions” as defined undernotification No. 12/ 2017-Central Tax (Rate) dated 28.06.2017 as they provide education as a part of a curriculum for obtaining a qualification recognised by law for the time being in force.

2. At present, Indian Institutes of Managements are providing various long duration programs (one year or more) for which they award diploma/ degree certificate duly recommended by Board of Governors as per the power vested inthem under the IIM Act, 2017.Therefore, it is clarified that services provided by Indian Institutesof Managements to their students-in all suchlong duration programs (one year or more) are exempt from levy of GST. As per information received from IIM Ahmedabad, annexure 1 to this circular provides a sample list of programmes which are of long duration (one year or more), recognized by law and are exempt from GST.

3. For the period from 1stJuly, 2017 to 30thJanuary, 2018, IIMs werenot covered by the definition of educational institutions as given in notification No. 12/ 2017 Central Tax (Rate) dated 28.06.2017. Thus, they were not entitled to exemption under Sl. No. 66 of the said notification. However, there was specific exemption to following three programs of IIMsunder Sl. No. 67 of notification No. 12/2017-Central Tax (Rate): -

(i) two-year full time Post Graduate Programmes in Management for the Post Graduate Diploma in Management, to which admissions are made on the basis of Common Admission Test (CAT) conducted by theIndian Institute of Management,

(ii) fellow programme in Management,

(iii) five years integrated programme in Management.

Therefore, for the periodfrom 1st July, 2017 to 30th January, 2018, GST exemption would be available only to three long duration programs specified above.

4. It is further, clarified that with effect from 31stJanuary, 2018, all IIMs have becomeeligible forexemption benefitunder Sl. No. 66 of notification No. 12/ 2017-Central Tax (Rate) dated 28.06.2017. As such, specific exemption granted to IIMs vide Sl. No. 67has become redundant. The same has been deleted vide notification No.28/2018-Central Tax (Rate) dated, 31st December, 2018 w.e.f. 1st January 2019.

5. For the periodfrom 31st January, 2018 to 31st December, 2018, two exemptions, i.e.under Sl. No. 66 and under Sl. No. 67 of notification No. 12/ 2017-Central Tax (Rate), dated 28.06.2017 are available to the IIMs. The legal position in such situation has been clarified by Hon’ble Supreme Court in many cases that if there are two or more exemption notifications available to an assessee, the assessee can claim the one that is more beneficial to him. Therefore, from 31st January, 2018 to 31st December, 2018, IIMs can avail exemption either under Sl. No 66 or Sl. No.67of the said notification for the eligible programmes. In this regard following case laws may be referred-

i. H.C.L. Limited vs Collector of Customs [2001 (130) ELT 405 (SC)]

ii. Collector of Central Excise, Baroda vs Indian Petro Chemicals [1997 (92) ELT 13 (SC)]

iii.Share Medical Care vs Union of India reported at 2007 (209) ELT 321(SC)

iv. CCE vs Maruthi Foam (P) Ltd. [1996 (85)RLT 157 (Tri.) as affirmed by Hon’ble Supreme Court vide 2004 (164) ELT 394 (SC)

6. Indian Institutes of Managements also provide various short duration/ short term programs for which they award participation certificate to the executives/ professionals as theyare considered as “participants” of the said programmes.These participation certificates are not any qualification recognized by law. Suchparticipants are also not considered as students of Indian Institutesof Management. Services provided by IIMs as an educational institution to such participants is not exempt from GST. Such short duration executive programs attract standard rate of GST @ 18% (CGST 9% + SGST 9%). As per information received from IIM Ahmedabad, annexure 2 to this circular provides a sample list of programmes which are short duration executive development programs, available for participants other than students and are not exempt from GST.

7. Following summary table may be referred to whiledetermining eligibility of various programs conducted by Indian Institutesof Managementsfor exemption from GST.
 

8. This clarification applies, mutatis mutandis, to corresponding entries of respective IGST, UTGST, SGST exemption notifications. Difficulty if any, in the implementation ofthiscircular maybe brought to the notice of the Board.
 

Yours Faithfully,

Susanta Mishra
Technical Officer (TRU)
Email:susanta.mishra87@gov.in
Tel: 011-23095558

F. No. 354/428/2018-TRU

Annexure 1: (Programmes exempt under GST Law)

The IIM-Ahmedabad refers such persons as their students whoattend long duration programmes offered by the Institute for which diplomas / degrees are awarded by the Institute. These programmes are awarded based on the recommendation by the Board of Governors as per the power vested inthem under the IIM Act, 2017. Such programmes are:

1. Post-Graduate Programme (PGP) - 2-year program

2. Post-Graduate Programme in Food and Agri-Business Management (PGP-FABM) –2-year program

3. Fellow Programme in Management (FPM) –4 to 5-year programv 4.Post-Graduate Programme in Management for Executives (PGPX) –12 months (1 year) full time program

5.ePost-Graduate Programme (ePGP) –2-year online program.

This list is an example of long duration programs recognised under IIM Act, 2017 offered by IIM Ahmedabad. Similar programs offered by other IIMs of India may kindly be referred by IIMs andtax authorities during assessment.

Annexure 2: Programmes not exemptunder GST Law

The executives / professionals doing short term courses (less than one year) are considered as “participants” of the programmes of the IIM Ahmedabad:

1. Armed Forces Programme

2. Faculty Development Programme

3. Executive Education

a.Customized Executive Programmes

b.Open Enrolment Programme

This list is an example of short duration executive development programs offered by IIM Ahmedabad which are available to participants. Similar programs offered by other IIMs of India may kindly be referred by IIMs andtax authorities during assessment.***