Stipend Reimbursed by Companies does not attract the provisions of GST
The issue as to whether stipend paid to students attract the provisions of Goods and Service Tax has been settled in the case of M/s. Yashaswi Academy for Skills, AAR Maharashtra. M/s Yashaswi Academy for skills (‘Applicant’) is a non-profit organisation under the Companies Act, 1956 and third-party Aggregator under the Apprentice Act 1961. The applicant entered into agreements with various companies to provide practical training to students and during the duration of the training, the apprentices were paid monthly stipend. The applicant further receives reimbursement of actual amount incurred for procurement of goods and/or services on behalf of the industry.
The AAR Maharashtra held that since the stipend is not directly paid by the companies rather directed though the applicant thus the applicant is not allowed to many any deductions from the stipend before providing it to the trainees. The AAR further noted that the applicant only acts as an intermediary and thus the amount received by the applicant in the form of reimbursement does not attract any GST.
 M/s. Yashaswi Academy for Skills, AAR Maharashtra https://www.mahagst.gov.in/en/advance-ruling?field_ddq_date_value%5Bvalue%5D%5Byear%5D=&subject_search=yashaswi