GST Exemption for Charitable Trusts: Tamil Nadu AAR Ruling TN/010/AAR/2023
The Tamil Nadu Authority for Advance Ruling confirmed that public health awareness services by a registered charitable trust are exempt from GST.
- Ruling
- Advance Ruling No. 10/ARA/2023 Dated: 06.06.2023
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Polarls Foundation asked if its UNICEF partnership activities qualify as GST-exempt supply.
- The Authority ruled these activities are a supply of service.
- The services are exempt from GST under Notification No. 12/2017-Central Tax (Rate).
- The trust must be registered under Section 12AA of the Income Tax Act.
In short
The company asked if its work with UNICEF to promote public health awareness is taxable under the Goods and Services Tax (GST). The Authority for Advance Ruling (AAR) examined whether these activities qualify as charitable services that are exempt from tax.
What has changed
How it worked before
It was previously unclear if specific public health awareness projects conducted by charitable trusts in partnership with international organizations qualified for the standard GST exemption for charitable activities.
What has changed
The authority decided that public health awareness activities fall under the definition of charitable activities. This means trusts registered under Section 12AA of the Income Tax Act do not need to pay GST on these specific services.
Who this affects
Charitable trusts and non-governmental organizations (NGOs) that partner with international bodies to provide public health or community awareness services.
An example
A local NGO registered under Section 12AA partners with a global health agency to run a vaccination awareness campaign. They might wonder if they need to charge GST on the funds received for this project. Based on this ruling, if the activity is classified as public health awareness, they can likely claim the NIL rate of GST.
What you should do
If you run a charitable trust, review your service agreements to see if they match the definition of charitable activities. Remember that an advance ruling only binds the business that asked and its own tax office; it is not a universal law for all trusts.
If you do nothing
If you assume this ruling applies to you and stop paying GST on services that do not actually qualify as charitable, you risk a tax demand. A tax officer may disagree with your classification, leading to penalties and interest charges for unpaid tax.
The terms explained
- Advance Ruling
- A formal decision from the tax department that clarifies how GST laws apply to a specific business situation.
- Section 12AA
- A section of the Income Tax Act that allows charitable trusts to register and receive tax benefits.
- NIL rate of GST
- A tax rate of zero percent, meaning no GST is payable on the service.
The ruling in detail
Authority for Advance Ruling
Polaris Foundation
Advance Ruling No. 10/ARA/2023 Dated: 06.06.2023 · Tamil Nadu
Questions before the authority
- Whether the activities undertaken by the applicant in partnership with UNICEF amounts to supply under GST?
- Whether the said supply is exempted under GST?
Facts
The applicant is a charitable trust registered under Section 12AA of the Income Tax Act, 1961. They entered into an MOU with UNICEF to implement a programme focused on strengthening COVID-19 and seasonal hazard preparedness at the Gram Panchayat level. The activities involve creating public awareness on COVID-appropriate behavior, infection prevention, and community control.
Ruling
| Question | What the authority ruled |
|---|---|
| Whether activities in partnership with UNICEF amount to supply | Yes, it amounts to a supply of service Specifically for activities relating to public awareness of preventive health |
| Whether the supply is exempted under GST | Yes, it is exempted Exempted under Sl. No. 1 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 |
The Authority ruled that the activities undertaken by the applicant in partnership with UNICEF, specifically relating to public awareness of preventive health, qualify as a supply of service. It further held that this supply is exempted from GST under the relevant notification.
Reasoning
The Authority relied on the definition of charitable activities provided in Notification No. 12/2017-Central Tax (Rate). It determined that the applicant's activities, which focus on public awareness of preventive health, fall squarely within the scope of clause 2(r)(i)(B) of the notification. Consequently, because the applicant is registered under Section 12AA of the Income Tax Act, these specific services are eligible for the **NIL rate of GST**.
Provisions relied on
- Section 7(1) of the CGST Act, 2017
- Section 2(31) of the CGST Act, 2017
- Section 2(84) of the CGST Act, 2017
- Section 2(17) of the CGST Act, 2017
- Section 12AA of the Income Tax Act, 1961
- Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017
For the practitioner
This ruling confirms that charitable trusts registered under Section 12AA can claim **GST exemption** for services related to public awareness of preventive health. Practitioners should note that the exemption is activity-specific; other services provided by the trust that do not fall under the definition of charitable activities remain taxable. It provides a clear precedent for NGOs partnering with international bodies like UNICEF on public health initiatives.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/10_aar_2023polaris.pdf
Legibility of the scan, as read: high.
Prepared 20-10-2026.
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