GST Update / 2026-27/0073

Bharathidasan University v. The Joint Commissioner of GST (ST-Intelligence), Trichy Division & Anr

GST UPDATE

Hon’ble Court: Supreme Court of India
Case Title: Bharathidasan University v. The Joint Commissioner of GST (ST-Intelligence), Trichy Division & Anr
Petition No. & Citation: SLP (C) Nos. 17945-17948 of 2026

Hon’ble Judge(s)
Date of Order	16 July 2026
Outcome	Issue left Open

Brief Facts of the Case

In the instant case, the issue before the Supreme Court concerned the levy of GST on affiliation fees collected by the University from its affiliated institutions for the financial years 2019-20 to 2022-23. The GST authorities had issued a show cause notice under Section 74(5) of the Tamil Nadu GST Act, 2017, proposing GST along with applicable interest and penalties on such affiliation fees. The University contested the levy by relying upon Notification No. 12/2017-Central Tax (Rate) and contending that educational and regulatory levies of this nature do not constitute a commercial “supply” or “consideration” for GST purposes. The controversy arose because different Benches of the Madras High Court had taken conflicting views on the issue. Consequently, the matter was referred to a Division Bench for consideration. The Division Bench of the Madras High Court held that the service of granting affiliation is an independent statutory pre-requisite and falls outside the restricted scope of services relating to “admissions to, or conduct of examination by, an educational institution.” After answering the reference, the matter was remanded to the learned Single Judge for deciding the remaining issues.
Aggrieved, the University approached the Supreme Court.

Relevant Notification

Entry 66 of Notification No. 12/2017-CT(R)

Question before Hon’ble Court

Whether affiliation fees collected by a University from its affiliated institutions are liable to GST, particularly whether the activity of granting affiliation can be treated as a taxable supply or whether it falls within the exemption available to educational institutions under the GST exemption notification.

Arguments before the Supreme Court

The University approached the Supreme Court pointing out that there were conflicting decisions of various High Courts on the taxability of affiliation fees. It was also submitted that the Supreme Court had earlier dismissed a departmental appeal arising from a Karnataka High Court decision which had held that the exemption was available even in respect of affiliation fees. The University therefore requested for the clarification on the recurring issue, which would have significant financial implications for universities across the country as the issue was interpretational industry wide.

Findings and Judgement

The Supreme Court did not finally decide the question of GST exemption on affiliation fees. The Court observed that its earlier order dated 24 January 2025, whereby an SLP filed by the Department had been dismissed, did not result in merger of the High Court judgment with the Supreme Court's order. The Supreme Court therefore permitted the matter to proceed before the learned Single Judge of the High Court in relation to the residual issues. It specifically observed that, after the Single Judge decides the matter, the University would be at liberty to challenge any order prejudicial to it, along with the Division Bench's decision on the reference, before the Supreme Court. Hence, the issue was left open.

CA Pradeep Jain_

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GST Update / 2026-27/0073

GST UPDATE

Brief Facts of the Case

Relevant Notification

Question before Hon’ble Court

Arguments before the Supreme Court

Findings and Judgement

CA Pradeep Jain_

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