I-T slaps service tax on IIMA

Ahmedabad, Mar 13 (UNI) With Indian Institute of Management-Ahmedabad (IIMA) charging 'placement fees' from domestic and overseas recruiters for the last couple of years, Income-Tax (I-T) officials have slapped Service Tax on the country's top B-School.

Union Finance Minister has brought man-power recruitment agencies, among other services, under the gamut of Service Tax during the last budget proposals.

When asked if IIMA had charged Service Tax from the recruiters, IIMA director Bakul Dholakia said he could not discuss the details since it is a disputed matter.

''We do not consider ourselves as recruitment agents. We do charge fixed 'placement fees' from the recruiters for participation and 'variable charges per 'acceptance' by students. We have replied to them (I-T Department) but connot discuss more since it is an ongoing dispute,'' he said.

According to IIMA sources, the institute does not charge any placement fees from companies hiring IIMA student as summer interns, also called summer placement, at the end of First Year of the Two-Year Post-Graduate Programme (PGP), equivalent to MBA.

However, IIMA does charge placement fees for the final recruitment held from the companies around this time of the year, the exact amount varying from year to year.

The placement rules are decided by the batch and vary across the batches too. The rules for summer are decided by October and for the final placement by January.

The domestic companies are charged a fixed fee, varying from Rs 1.50 lakh down to Rs 40,000, and variable fee for each acceptance, ranging from Rs 50,000 down to Rs 25,000, depending on the priority of interviewing students.

The overseas recruiters are charged only variable 'placement fees' of USD 5,000 (Rs 2,25 lakhs) per acceptance.

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