Levy of GST— In the instant case, the applicant has sought Advance Ruling on the following questions:
1. Whether the supply of medicines, drugs and other surgical goods to In-Patients during the course of diagnosis and treatment of disease, illness, injuries, deformities and abnormalities would fall meaning of “composite supply” qualifying for exemption under the category of “health care services.”?
2. Whether the supply of medicines, drugs and other surgical goods to Out-Patients during the course of diagnosis and treatment of disease, illness, injuries, deformities and abnormalities would fall meaning of “composite supply” qualifying for exemption under the category of “health care services.”?
3. Whether the supply of Implants, Prosthetics and Mobility aids during the course of diagnosis and treatment of disease, illness, injuries, deformities and abnormalities would fall meaning of “composite supply” qualifying for exemption under the category of “health care services.”?
The applicant is a Registered Partnership Firm, has a Multi-Speciality Hospital providing Health Care Services in Coimbatore. They offer wide range of services including Anaesthesiology, Cardiology, Dermatology, Diabetes, Emergency & Trauma, ENT, Gastroenterology, General Surgery, General Medicine, Obstetrics & Gynaecology, Intensive Care, Radiology, Nephrology, Neurology, Physiotherapy, Neuro Surgery, Orthopaedic, Paediatric, Pulmonology, Urology. In order to provide healthcare services the applicant also maintains Pharmacy, Clinical Laboratory, X-Ray & Scanning facility, Ambulance Services, Dietary Services etc. The applicant has stated that they have categorized the Patients as Out-Patients and In-Patients for their convenience; The Out-Patients are those who visit the Hospital for Routine check-ups, clinical visits and the Hospital provides diagnosis to them. Medicines are prescribed to them as part of treatment. Whereas the In-Patients are those who are admitted to the hospital for the required treatment. They are provided with stay facilities, dietary food for the treatment. They are also provided with medicines, drugs, stents, implants, other surgeries/ procedures etc. as incidental to the Health Care Services rendered in the hospital.
Held that— 1. Supply of Medicines and consumables used in the course of providing health care services to in-patients admitted to the hospital for diagnosis, or medical treatment or procedures till discharge is a composite supply of In Patient Healthcare Service, provided the consolidated bill raised in the name of the patient indicates the supply of medicines and consumables during the course of provision of health care services, as defined in Para 2 (zg) of Notification no 12/2017-C.T. (rate) dated 28.06.2017 as amended and Notification No. II (2)/CTR/ 532(d-15)/2017 vide G.O. (Ms) No. 73 dated 29.06.2017 as amended and the same is exempted from CGST and SGST as per S1 No 74 of the above notifications respectively for the period upto 17.07.2022. Effective from 18.07.2022, if the room charges [excluding ICU/CCU/ICCU/NICU] exceeds Rs.5000/- per day, the applicable rate of tax is 5% as per the Notification 11/2017 CT(Rate) dated 28.06.2017 as amended.
2. Supply of Medicines and consumables prescribed in the course of providing health care services to Out-patients of the hospital is not a composite supply and hence taxable to GST.
3. Supply of Implants which are implanted in the body essentially by means of a surgical procedure during the course of diagnosis and treatment for diseases, illness, injuries, deformities, abnormalities for in patients is to be considered as “Composite supply” of health care service, whereas the supply of prosthetics and mobility aids, being in the nature of independent supply are to be considered as individual supplies and taxed accordingly.