My Client is running a private diagnostic center whether GST will be applicable on such establishment or whether they will be classify under clinical establishment so exempt from tax ? Give reasons with support of notification or judgment?

Reply—The term “clinical establishment” is defined in clause (s) of Paragraph 2 of Notification No.12/2017-Central Tax (Rate) dated 28.06.2017, as under:-“

(s) “clinical establishment" means a hospital, nursing home, clinic, sanatorium or any other institution by, whatever name called, that offers services or facilities requiring diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India, or a place established as an independent entity or a part of the establishment to carry out Diagnostic or investigative services of diseases”.

Therefore, to be covered under the definition, the applicant shall be either,-

(a) an institution offering services or facilities requiring diagnosis for illness, injury, deformity, abnormality or pregnancy; or

(b) A place established as an independent entity or part of the establishment to carry out Diagnostic or investigative services of diseases.

Since the applicant is offering Diagnostic services, they would be covered under the term “clinical establishment” for the purposes of entry no.74 of the Notification No.12/2017-Central Tax (Rate) dated 28.06.2017.

“Services by way of health care services by a clinical establishment” are covered under entry 74 of the Notification No.12/2017-Central Tax (Rate) dated 28.06.2017 and hence is exempted from GST.

You can refer advance ruling pronounced by AAR Karnataka in matter of Matrix Imaging Solutions India Private Limited dated 30.09.2019.