Supreme Court Issues Notice On Plea Challenging 18% GST On DNB Doctors' Fee

During the hearing, Mr Nadkarni submitted that even when the Board's notification itself states that fee cannot be increased by more than 5%, the fee has been increased from 80,000 to 1 lakh.

Regarding their prayer for directions to National Medical Commission to conduct Practical Theory Exams of 2 consecutive sessions December 2020 & June, 2021 with gap of minimum one month, Mr Nadkarni submitted that he would argue that aspect later.

"That we may not get into. The schedule is already out and Exams are already going on for DNB." the Bench said.

Mr Nadkarni however submitted that he may seek a general observation later stating that these examinations cannot be combined. He added that the idea of having the exams in different months is so people can appear in both, and the exams cannot be held one after the other and disentitle people from appearing.

Mr Nadkarni informed the Court that the Board has itself fixed the fee upto 80,000 which colleges are entitled to charge.

"Amount of 80,000 was fixed in 2018 and it will apply to even students passing in 2021. That is their own regulation. The fee is increased to 1.25 lakh in 2019, so 2019-22 this will apply. Now what is sought to be done through the impugned notification GST is sought to be added. It says payment of GST is mandatory according to Government which is not true, it is the contrary." Mr Nadkarni said.

The Bench opined that this fee of 1.20 lakh is not just for the exam, and is charged by the National Board of Examination for the entire course and may not be exempt.

"What they are charging for exams may not be subject to GST, but the course fee is subject to the 18% GST", the Bench said.

"The idea is that educational institution shouldn't be charged. It's not a service. It is something that the State provides", Mr Nadkarni said.

"The Respondent conducts DNB exams for broad speciality, super speciality courses. I'm doubtful if this notification will apply to these institutions charging fees for courses", Justice Chandrachud said.

" It is an important issue, anyway we should consider it", Justice Chandrachud said.

"They have not increased the fee, it is due to GST that it has come to more than 1 lakh", Justice Shah said

Justice Shah further asked Mr Nadkarni "how can you challenge levy of 2019 now?"

Mr Nadkarni responded saying that in 2019 it was clarified that it (increase in fee) will only to students from that year. However now when they are imposing GST on the fee, they have clarified it will apply to everyone including 2018 students.

The petitioner Association was represented by Senior Advocate ANS Nadkarni, Advocates Puneet Yadav, Sourabh Gupta and Parijat Kishore.

In the present case, the DNB Doctors have sought quashing of notification imposing 18% GST on DNB Candidates on the following grounds:

• Fee of DNB & FNB Candidates are fixed on basis of several factors prevailing in each State including operating costs, salary, etc and stipends paid to them depending on scales fixed by different States.

• A maximum permissible limit for charging of the fees has been notified by NBE to ensure that unnecessary financial difficulty are not caused to DNB candidates.

• The introduction of 18% GST on fee being directed to he deposited by the DNB/ DrNV and FNB candidates which is totally unreasonable and unfounded. These courses are 2-3 year professional courses recognised by National Medical Commission as recognised postgraduate medical qualifications registrable for practising medicine in India. They therefore fall in category a of Central Tax notification dated 28th June 2016 and are exempted from GST.

• Even after a clarification of Central Board of Indirect Taxes and Customs dated 17th June 2021, the National Board of Examinations is forcing its students to pay extra GST charges on Education/ Tuition fees by way of threatening mails saying that if fee is not paid till August 5th them candidature will be cancelled.

Case Title. Association of Diplomate of National Board Doctors v National Medical Commission

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