#GST exemption

The Karnataka High Court has ruled that pigmy agents working for Karnataka Vikas Grameena Bank are employees, not business facilitators, making their services exempt from GST under Schedule III of the CGST Act. The decision hinges on control, remuneration structure, and TDS deductions - setting a critical precedent for rural banking networks and informal service providers across India.

The Karnataka High Court ruled that GST exemption under Notification 41/2017 is contingent on direct supply to the registered recipient or their registered warehouse. Delivery to third parties-even at the recipient’s instruction-disqualifies the supplier from the concessional rate, underscoring the strict compliance required for tax exemptions under GST law.

Madras High Court rules affiliation fees collected by universities are taxable under GST, not exempt as educational services. Key implications for universities and tax practitioners.