The AAR, West Bengal in the matter of M/s Snehador Social & Health Care Support LLP [Order No. 18/WBAAR/2022-23 dated December 22, 2022] has ruled that doorstep healthcare and logistic services provided to senior citizens are not exempted services and attracts Goods and Services Tax (“GST”) at the rate of 18%.
M/s Snehador Social & Health Care Support LLP (“the Applicant”) is involved in providing healthcare services to senior citizens, which includes arranging of doctors, nurses, taking clients to diagnostic centres, etc. The applicant also provides logistics support like delivery of medicines and groceries, help with bank work and bill payments etc. To avail the services provided by the Applicant, one needs to enrol as a member first under three packages for which one is required to pay annual registration fee, quarterly fee along with a refundable security deposit.
Further, the Applicant also provides services like additional general physician visit, night call-general physician, nurses per shift, physiotherapist assessment etc. at the cost of extra charges.
The Applicant has contended that the healthcare services provided by it, when provided on individual basis are considered as ‘Clinical Establishment’ and hence are exempted from GST vide Sl. No. of Notification No. 12/2017 – Central Tax (Rate) dated June 28, 2017 (“the Services Exemption Notification”). Therefore, the same services provided by it at the doorstep of senior citizens should also be exempted.
- Whether the services rendered by the applicant comes under exemption category and what will be the classification of such services?
- If such service is held taxable, then what would be the rate of tax?
The AAR, West Bengal in Order No. 18/WBAAR/2022-23 dated December 22, 2022 held as under:
- Noted that, the services provided by the Applicant to its enrolled members have two limbs i.e. provided under a specific package against a consolidated amount during a quarter period and for the second part, the Applicant charges separately from its members for each type of services.
- Further noted that, the supply of healthcare services qualifies for exemption under Sl. No. 74 under the Services Exemption Notification, if it is provided by a clinical establishment, an authorized medical practitioner or a paramedic.
- Observed that, the Applicant does not fall under any of such categories and hence fails to qualify for the exemption.
- Stated that, the services w.r.t. accompanying members for essential & social outings, accompanying member to the Bank & Post Office, organising social gathering and entertainment programmes etc., provided by the Applicant falls under the category of ‘human health and social care services, vide Sl. No. 31 of the Notification No. 11/2017 – Central Tax (Rate) dated June 28, 2017 (“the Services Rate Notification”) and is taxable at 18% GST.
- Held that, the healthcare services along with the logistics support provided by the Applicant does not qualify for exemption under Sl. No. 74 of the Services Exemption Notification and the same is taxable at 18% GST vide Sl. No. 31 of the Services Rate Notification.
Sl. No. 31 of the Services Rate Notification:
|Chapter, Section or Heading||Description of Service||Rate (per cent.)||Condition|
|31||Heading 9993||Human health and social care services.||9”||
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