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Services provided by private Industrial Training Institutes for designated trades under the Apprenticeship Act are exempt from Goods and Services Tax. Services provided for other than designated trades remain liable to Goods and Services Tax. Private Industrial Training Institutes qualify as educational institutions if their education is approved as a vocational educational course. Entrance examinations and admission services for designated trades are also exempt from Goods and Services Tax. Services provided by Government Industrial Training Institutes to individual trainees are exempt under a separate notification.
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CIRCULAR NO. 55/29/2018- GST
F. No. 354/159/2018-TRU Government of India Ministry of Finance Department of Revenue Central Board of Indirect Taxes and Customs
New Delhi, the $10^{\text{th}}$ August, 2018
To
The Principal Chief Commissioners / Chief Commissioners/ Principal Commissioners/ Commissioner of Central Tax (All) / The Principal Director Generals/ Director Generals (All).
Madam/Sir,
Subject: Taxability of services provided by Industrial Training Institutes (ITI) - reg.
Representations have been received requesting to clarify the following:
With regard to the first issue, [Para 1(a) above], it is clarified that Private ITIs qualify as an educational institution as defined under para 2(y) of notification No. 12/2017-CT(Rate) if the education provided by these ITIs is approved as vocational educational course. The approved vocational educational course has been defined in para 2(h) of notification ibid to mean a course run by an ITI or an Industrial Training Centre affiliated to NCVT (National Council for Vocational Training) or SCVT (State Council for Vocational Training) offering courses in designated trade notified under the Apprenticeship Act, 1961; or a Modular employable skill course, approved by NCVT, run by a person registered with DG Training in Ministry of Skill Development. Therefore, services provided by a private ITI in respect of designated trades notified under Apprenticeship Act, 1961 are exempt from GST under Sr. No. 66 of notification No. 12/2017-CT(Rate). As corollary, services provided by a private ITI in respect of other than designated trades would be liable to pay GST and are not exempt.
With regard to the second issue, [Para 1(b) above], it is clarified that in case of designated trades, services provided by a private ITI by way of conduct of entrance examination against consideration in the form of entrance fee will also be exempt from GST [Entry (aa) under Sr. No. 66 of notification No. 12/2017-CT(Rate) refers]. Further, in respect of such designated trades, services provided to an educational institution, by way of, services relating to admission to or conduct of examination by a private ITI will also be exempt [Entry (b(iv)) under Sr. No. 66 of notification No. 12/2017-CT(Rate) refers]. It is further clarified that in case of other than designated trades in private ITIs, GST shall be payable on the service of conduct of examination against consideration in the form of entrance fee and also on the services relating to admission to or conduct of examination by such institutions, as these services are not covered by the exemption ibid.
As far as Government ITIs are concerned, services provided by a Government ITI to individual trainees/students, is exempt under Sl. No. 6 of 12/2017-CT(R) dated 28.06.2017 as these are in the nature of services provided by the Central or State Government to individuals. Such exemption in relation to services provided by Government ITI would cover both – vocational training and examinations conducted by these Government ITIs.
Difficulty if any, in the implementation of this circular may be brought to the notice of the Board.
Yours Sincerely,
[Image omitted. See the official document.] (Parmod Kumar) OSD (TRU II) Tele No.: 011-23092374 E-mail: parmodkumar.71@gov.in
