In a major relief to various statutory medical councils in Gujarat, the Gujarat High Court has stayed the Goods & Services Tax (GST) department's proceedings against five regulatory councils and boards over the issue of taxability on the services provided by them.

Key Highlights
Regulatory Bodies Involved

• Gujarat Medical Council

• Council of Homeopathic System of Medicine

• Gujarat Board of Ayurvedic and Unani System of Medicine

• Gujarat State Dental Council

• Gujarat State Council for Physiotherapy

GST Department’s Position

• The Director General of GST Intelligence (DGGI) issued notices to these councils under Section 74 of the GST Act.

• The DGGI argued that the councils are body corporates with GST numbers, providing services in exchange for fees, making them liable for GST.

Councils' Stand

• The councils responded stating they are statutory bodies formed under various state acts and function as extended arms of the government.

• They argued that they should not be classified as private corporate entities and are not liable for GST on their services.

Statements from Leaders or Officials

• Advocate Neel Lakhani (representing DGGI):

Lakhani informed that the councils filed petitions claiming they are not taxable persons under the GST Act and requested the court to quash the GST department's communication.

• Gujarat High Court Observation:

A bench comprising Justice Bhargav Karia and Justice D N Ray issued notices to the GST department, directing them not to take any coercive action against the councils until further hearing. The department has been asked to file its reply by May 1, 2025.The Gujarat High Court’s interim relief protects the councils and boards from immediate tax demands, while the matter will be further examined. The outcome of this case will set a significant precedent regarding whether statutory medical councils are liable to pay GST or fall under government exemptions.