Karnataka AAR Holds Printing of Exam Question Papers for Universities Exempt from GST Under Notification No. 12/2017-Central Tax (Rate)

Karnataka Authority for Advance Ruling (AAR) has delivered a significant ruling on the applicability of GST exemption to the printing of examination question papers supplied to universities. The applicant, engaged in providing printing services for exam papers as per university specifications, sought an advance ruling on whether such services are exempt from GST under Entry 66(b)(iv) of Notification No. 12/2017-Central Tax (Rate), as amended.

The applicant argued that their services fall within the scope of the exemption, as the notification exempts services provided to educational institutions relating to admission or conduct of examinations. They emphasized that universities are covered under the definition of “educational institution” as per paragraph 2(y) of the notification, being institutions that provide education as part of a curriculum for obtaining a qualification recognized by law. The applicant also relied on several previous AAR rulings and judicial precedents, including the Karnataka High Court and Supreme Court decisions affirming that universities are educational institutions for the purpose of such exemptions.

Upon examination, the AAR confirmed the admissibility of the application and proceeded to analyze the legal provisions. The Authority noted that the definition of “educational institution” under the notification includes universities, as they provide structured, curriculum-based education culminating in qualifications recognized by law. The AAR further clarified that Entry 66(b)(iv) exempts not only the core activities of admission and conduct of examinations but also ancillary and incidental services directly connected to these activities. The printing of question papers, being indispensable to the conduct of examinations, was held to have a direct and proximate nexus with the examination process.

The AAR also referred to Circular No. 151/07/2021-GST, which clarified that input services such as printing of question papers, when provided to educational boards or institutions, are covered under the exemption. The Authority relied on the Karnataka High Court’s decision in Rajiv Gandhi University of Health Sciences, affirmed by the Supreme Court, which categorically recognized universities as educational institutions for the purpose of exemption notifications.

In conclusion, the AAR ruled that the service of printing examination question papers supplied by the applicant to universities constitutes a service relating to the conduct of examinations. Such services are specifically covered under Entry 66(b)(iv) of Notification No. 12/2017-Central Tax (Rate), as amended, and are therefore exempt from GST. This ruling provides clarity and certainty for service providers engaged in similar activities with universities and other educational institutions.