Page 118 - GSTL_20th August 2020_Vol 39_Part 3

332 GST LAW TIMES [ Vol. 39
The medicines, consumables and implants used in the course of provid-
ing health care services to the patients admitted for diagnosis or treatment in the
hospital or clinical establishment is naturally bundled in ordinary course of busi-
ness. The patients are expected to receive health care services which include re-
ceiving the appropriate medicine, relevant consumables, or implants required to
make sure that appropriate diagnosis or the best possible treatment of the health
issues are conducted. If there is no supply of medicines, consumables or im-
plants, it would be difficult to render the health care service which will ultimate-
ly have an impact in the survival of the patients. The health care service cannot
be provided without the drugs/consumables/stents. This being a composite
supply the principal supply is predominant which is health care and therefore
the same is to be considered for taxability under GST. The ancillary supplies such
as room rent and dietary food provided to in-patients also shall be exempt and
beyond the ambit of taxation.
4. Questions raised before the authority :
(1) Tax liability on the medicines supplied to in-patients through
pharmacy.
(2) Tax liability on the medicines, drugs, stents, implants etc. adminis-
tered to in-patients during the medical treatment or procedure.
On Verification of basic information of the applicant, it is observed that the ap-
plicant falls under State jurisdiction, i.e. Assistant Commissioner, Chittoor-1 Cir-
cle, Chittoor Division. Accordingly, the application has been forwarded to the
jurisdictional officers and a copy marked to the central tax authorities to offer
their remarks as per the Sec. 98(1) of CGST/APGST Act, 2017.
In response, remarks are received from the jurisdictional officer con-
cerned stating that there are no proceedings lying pending or passed relating to
the applicant on the issue, for which the Advance Ruling sought by the appli-
cant.
5. Applicant’s interpretation of law and facts :
(i) Health Care Services : Health care services means 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 and includes services by way of transportation of the patient
to and from a clinical establishment, but does not include hair
transplant or cosmetic or plastic surgery, except when undertaken
to resolve of to reconstruct anatomy or functions of body affected
due to congenital defects, developmental abnormalities, injury or
trauma.
(ii) Clinical establishment : The words ‘clinical establishment’ mean a
hospital, nursing home, clinic, sanatorium or any other institution
by whatever name called, that offers services or facilities requiring
diagnostics or treatment or care for illness, injury, deformity, ab-
normality 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.
Taxability of health care services :
Health care services provided by a clinical establishment, an authorized

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