This circular provides clarity on the GST treatment of different programmes conducted by the Indian Institutes of Management (IIMs), in light of the Indian Institutes of Management Act, 2017, which came into force on 31 January 2018.

The circular clarifies that, with effect from 31 January 2018, all IIMs notified under the IIM Act are treated as “educational institutions” since they are empowered to grant degrees, diplomas, and other academic distinctions recognised by law. Accordingly, services provided by IIMs to their students in long-duration programmes of one year or more, which lead to the award of a degree or diploma approved by the Board of Governors, are exempt from GST under Sl. No. 66 of Notification No. 12/2017-Central Tax (Rate).

For the period from 1 July 2017 to 30 January 2018, IIMs were not covered under the general definition of educational institutions. During this period, GST exemption was available only for three specified programmes, namely the two-year Post Graduate Programme in Management (PGP) through CAT, the Fellow Programme in Management (FPM), and the five-year Integrated Programme in Management. Other programmes during this period were taxable.

The circular further clarifies that from 31 January 2018 onwards, all long-duration programmes of one year or more offered by IIMs, including one-year executive postgraduate programmes that confer a recognised qualification, are exempt from GST. The specific exemption earlier provided to certain programmes has since been withdrawn as redundant.

It is also clarified that short-duration executive development programmes or need-based programmes of less than one year, which only provide participation certificates and do not confer qualifications recognised by law, are not exempt and attract GST at the applicable rate of 18%.