Are affiliation and registration fees paid by colleges to the University exempt from GST?

No. The AAR held these are not covered by the exemption in Notification 12/2017-CTR and are taxable.

What did the AAR focus on while deciding taxability?

The nature of services—affiliation, examination, and inspection—were distinct from imparting education by colleges.

Which notification was discussed?

Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017.

Who delivered the decision?

The Authority for Advance Ruling (AAR), Tamil Nadu, on 19.11.2020.

Bharatiyar University, Tamil Nadu AAR

Q: Do exam and inspection services count as 'education services' for exemption?

No. They are separate services provided by the University to its colleges and are taxable.

Quick Summary

The Tamil Nadu AAR held that fees collected by Bharatiyar University from its constituent/self-financing colleges for affiliation, registration, inspection, and examinations are taxable under GST. They are treated as separate services to colleges, not as exempt “education” services under Notification 12/2017-CTR.

CASE_TITLE: Bharatiyar University, Tamil Nadu AAR (Order: 19.11.2020) | PUBLISH_DATE: 2 Nov 2025 | AUTHOR_NAME: Gulzar Hashmi | LOCATION: India

Issues

Are affiliation, registration, inspection, and exam fees paid by colleges to the University exempt from GST?
Do these activities qualify as education services provided to students for exemption?

Rules

Notification 12/2017-CTR (28.06.2017): Exempts specified education services (to students) and services to an educational institution if covered.
Scope: University-to-college services like affiliation/inspection are viewed as separate administrative services, not the delivery of education to students.

Facts (Timeline)

Public University

Timeline for Bharatiyar University GST AAR case

University: Government-established public university in Tamil Nadu.

Services: Provides affiliation, inspection, registration, and examination support to constituent/self-financing colleges.

Fees: Charges fees for each of these services.

Advance Ruling: Sought clarity on GST exemption under Notification 12/2017-CTR.

Outcome: AAR held the fees are not exempt; they are taxable supplies to colleges.

Arguments

Applicant (University)

Affiliation/inspection/exam activities are integral to education.
Fees should fall within education-related exemption.
Colleges exist to educate students; enabling services should not be taxed.

Revenue

Services are to colleges, not directly to students.
They are regulatory/administrative in nature, not teaching/education delivery.
Hence, exemption under Notification 12/2017-CTR does not apply.

Judgment

Exemption Denied

The AAR ruled that affiliation, registration, inspection, and exam services provided by the University to its colleges are taxable supplies. These are distinct services and do not qualify for exemption under Notification 12/2017-CTR.

They are not the education imparted to students.
They function as oversight/permission/assessment services to colleges.

Ratio

For GST exemption in education, what matters is who receives the service and what the service is. University-to-college services like affiliation/inspection/exams are separate administrative supplies to the institution and are taxable.

Why It Matters

Clarifies GST treatment of common university-college transactions.
Helps colleges plan budgets for affiliation and exam cycles.
Guides universities on invoicing and compliance for these services.

Key Takeaways

Affiliation/inspection/exam fees to colleges are taxable.
Exemption under Notification 12/2017-CTR is narrow and student-centric.
Nature and recipient of service decide taxability.
Universities should charge GST and keep records accordingly.

Mnemonic + 3-Step Hook

Mnemonic: “WHO–WHAT–WHY TAX”

WHO gets the service? (Colleges, not students)
WHAT is the service? (Affiliation/inspection/exam = admin)
WHY TAX? (Not covered by education exemption → GST applies)

IRAC Outline

Issue

Are fees for affiliation, registration, inspection, and examinations exempt under Notification 12/2017-CTR?

Rule

Exemption targets specific education services; separate administrative services to institutions are outside it.

Application

University’s services are to colleges and are administrative/permission-based → not exempt education to students.

Conclusion

Fees are taxable; exemption denied by AAR (19.11.2020).

Glossary

AAR: Authority for Advance Ruling—gives rulings on GST questions.
Affiliation: Permission by a university allowing a college to run courses/exams.
Notification 12/2017-CTR: Central tax rate notification listing exempt services, including some education services.
Education Services: Services directly related to teaching/learning provided to students.