• Kandivali West Mumbai 400067, India
  • 022 39167251
  • support@email.com
January 13, 2022

Whether lump-sum amount received for Health care Services to be provided for 20 years by the applicant as ‘Diamond Plan’ is exempted from Goods and Services Tax

by Mahesh Mara in GST, Legal Court Judgement

Whether lump-sum amount received for Health care Services to be provided for 20 years by the applicant as ‘Diamond Plan’ is exempted from Goods and Services Tax

Fact and Issue of the Case

M/s. Divyajivan Healthcare LPP, the applicant submits that it proposes to establish a multi-super speciality hospital and provide health care services to patients. The applicant devised a plan, namely “Health Care Service (Diamond Planf for providing health care services for next 20 years for which a lump-sum amount, say, Rs. 10 Lakhs will be charged. Under the plan the services will be provided to the family i.e., Member, Spouse & up to 2 children (age below 21 years). The applicant will also tie-up with other hospitals pan India from where the members can avail health care services.

The “Health Care Service (Diamond Plan) of the applicant includes the following services:-

i. Hospitalization Benefits i.e., in-patient Service up to INR 10 Lakhs in a year

ii. Compulsory Annual Preventive Health Check-up with 100+ test/investigation/consultations covered; which are tabulated as follows:

Blood Investigation:Cardiac Investigation:Other Investigation:Specialist Consultants:
Complete Hemograms (28)ECGPFTGeneral Physician
Lipid Profile (8)2D echo & colour DopplerAudiometryDental Surgeon
Liver Function Test (11)TMTFundoscopy -EYEGeneral Surgeon
Harmane & Vitamins (4)Chest X-rayRefractive ErrorsGynaecologist
Renal Function Test (8)Sonography Abdomen & Pelvic  
Urine & Stool Examination (18)BMD  

iii. Advance Health Check-up services; which are Coronary Angiography, Cancer Markers, Endoscopy, MRI – Any one part, Mammography & PAP Smear, Sleep Study, Foot Scan and Naturopathy.

iv. Special health care treatments; which are Dental Treatment (Basic Dental Care or one implants per year if need arises), Skin care treatment (No cosmetic/beautification treatment cover), Adult Vaccination (with basic Vaccine Cost).

v. Privilege Cards benefits; which are Home Care Services, Priority OPD appointments in tie-up hospital, tele-medical guidance through application.

3. The applicant will digitalize the health records based on the above tests and treatments of the beneficiary members for their easy access and shall also provide regular reminders, updates and health education tips.

Observation of the Authority

The Authority has carefully considered all the submissions made by the applicant. At the outset, we would like to state that the provisions of both the CGST Act and the GGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the GGST Act.

12. On careful consideration of the applicant’s submission, we find that the scope of supply of services by the applicant is ‘health care services’ by a clinical establishment and also that the applicant’s Partner Dr. P.G.Korodia is an authorised medical practitioner. We find the subject consideration is received for health care services. Further applicant’s tie up with the other hospital for diagnosis does not alter the scope of supply of health care services by the applicant to its service recipients.

13. Ere pronouncing the Ruling, we find it apt to reproduce the relevant excerpts of the CBIC Circular No. 32/06/2018-GST, dated 12-2-2018, as follows:

5.5. Is GST leviable in following cases : (1) Hospitals hire senior doctors/consultants/technicians independently, without any contract of such persons with the patient; and pay them consultancy charges, without there being any employer-employee relationship. Will such consultancy charges be exempt from GST? Will revenue take a stand that they are providing services to hospitals and not to patients and hence must pay GST? (2) Retention money : Hospitals charge the patients, say, Rs. 10000/- and pay to the consultants/technicians only Rs. 7500/- and keep the balance for providing ancillary services which include nursing care, infrastructure facilities, paramedic care, emergency services, checking of temperature, weight, blood pressure, etc. Will GST be applicable on such money retained by the hospitals?Health care services provided by a clinical establishment, an authorised medical practitioner or paramedics are exempt. [Sl. No. 74 of Notification No. 12/2017- CT(R) as amended refers]. (1) Services provided by senior doctors/consultants/technicians hired by the hospitals, whether employees or not, are healthcare services which are exempt. (2) Healthcare services have been defined to mean any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India [para 2(zg) of Notification No. 12/2017- CT(R)]. Therefore, hospitals also provide healthcare services. The entire amount charged by them from the patients including the retention money and the fee/payments made to the doctors etc., is towards the healthcare services provided by the hospitals to the patients and is exempt


M/s Divyajivan supplies Health care Services under Diamond Plan which merits exemption from GST vide Sr. No. 74 of said Notification No. 12/2017- CT(R)

Read the full order from here


Enter your email address:

Subscribe to faceless complainces

Please follow and like us:
Pin Share
Follow by Email