ABC is a private limited firm providing following services for company employees 1) health check up of employees like blood check up, ecg, xray etc on yearly basis 2) vaccination for employees like TT typhoid at the factory premises 3) providing doctors and nursing staff for occupational health center at the premises of factory. Above three services are provided by them and their clients viz factories are paying them against our contracts. They are not charging GST. Is it correct on their part?
ANSWER
Facts of the case:
ABC, a private limited firm
providing following services for company employees 1) health check-up of
employees like blood check-up, ECG, x-ray etc on yearly basis 2) vaccination for
employees like TT typhoid at the factory premises 3) providing doctors and
nursing staff for occupational health center at the premises of the factory.
They are not charging GST.
Law applicable:
Serial Number 74 of Notification no. 12/2017 CGST
Rate exempts the following from GST
"Services by way of-
(a) health care services by a clinical establishment, an authorized medical
practitioner or para-medics;
(b) services provided by way of transportation of a patient in an ambulance,
other than those specified in (a) above."
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where Clinical establishment is defined as:
(s) "clinical establishment" means a hospital, nursing home, clinic, sanatorium
or any other institution by, whatever name called, that offers services or
facilities requiring diagnosis or treatment or care for illness, injury,
deformity, abnormality or pregnancy in any recognized system of medicines in
India, or a place established as an independent entity or a part of an
establishment to carry out diagnostic or investigative services of diseases;
Interpretation:
Notification 12/2017 CGST Rate exempts the service
of health care from the charge of GST if provided by a clinical establishment,
an authorised medical practitioner or para-medics
ABC Pvt. Ltd. if falls within the definition of Clinical establishment, then
services provided by ABC shall be exempt in view of the aforementioned
Notification and therefore the same shall not be charged either on forward
charge basis or reverse charge basis.
However if they are operating only as manpower placement, then it will be
subjected to tax.
Conclusion:
Health care service by a clinical establishment is exempt and GST shall not be
charged on FCM or RCM basis. (Reply dt. 01/10/2021)