The Union Finance Minister Nirmala Sitharaman chaired the 54th meeting of the GST Council today (9th September 2024) at Sushma Swaraj Bhawan in New Delhi. The Union Minister of State for Finance M.P.P. Chaudhary, along with the Chief Ministers of Goa and Meghalaya, and the Deputy Chief Ministers of Arunachal Pradesh, Bihar, Madhya Pradesh, and Telangana also participated in the meeting.
The Show Cause Notices from the Directorate General of GST Intelligence (DGGI) for unpaid Goods and Services Tax ( GST ) over the Research Grants given since 2017 is not an attempt of Tax Terrorism but it is an issue of interpretation said the Finance Minister Nirmala Sitharaman in the 54th GST Council Meeting held in New Delhi.
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In the Council meeting the decision to exempt the Universities and research centers established by Central or State Government laws, or those granted with income tax exemptions, will now be exempt from paying 18% GST on research funding.
It was also clarified that these institutions can receive research funds from both public and private sources without being liable for GST.
A whopping amount of Rs.220 crore has been demanded from the seven educational institutions.
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Delhi Finance Minister, Atishi, criticized the government’s decision to impose an 18% GST on research grants received by educational institutions from private entities and stated that this move is unjustified.
DGGI’s stance was that the research grants are not exempted from the taxes and the R&D services provided by the institutions to entities like CSIR, ICMR and SERB does not qualify the GST exemptions. But many of the academicians, and scientists noted that these grants are typically hard to secure and are often tax-exempt in other countries.
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These Seven prominent Indian institutions also include the prestigious Indian Institute of Technology, Delhi (IIT, Delhi) and Anna University, Chennai. In case of IIT Delhi, it had been asked to pay Rs.120 crore, including penalties over the past seven years. Others have demands ranging from Rs.5 crore to Rs.60 crore.
The other institutions are Punjab University, Sree Chitra Tirunal Institute for Medical Sciences and Technology, the Centre for Sponsored Research and Consultancy (Anna University), Shanmugha Arts,Science,Technology & Research Academy, Amrita Vishwa Vidyapeetham and Kalingam Academy of Research and Education.
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