The Kerala State Goods and Services Tax (SGST) department has cancelled the GST registration of Indian Medical Association Goes Ecofriendly (IMAGE), an entity that does biomedical waste management in the state. The cancellation means that IMAGE is no longer permitted to bill for its services, potentially disrupting biomedical waste disposal operations, including in its facility in Kanjikode, Palakkad.
State Tax Officer Bindu Soman issued the cancellation order on January 31, 2025, retroactively effective from December 13, 2024. In response, IMAGE said that the decision poses a significant public health risk. “IMAGE is involved in the treatment and disposal of biomedical hospital wastes. Clearly, this is a key activity and one of great public importance. Cancelling registration of such an entity would have deleterious, ruinous effects on the carrying of this essential activity — the consequences need no elaboration,” the organisation stated in its reply to the tax department.
The GST department’s investigation revealed that IMAGE is not a separate legal entity but a project under the Indian Medical Association’s (IMA) Kerala state branch. While IMA is registered as a charitable organisation and cannot engage in commercial business, IMAGE has been charging hospitals, clinics, and laboratories for waste disposal. Key financial operations such as billing and contracts were found to be handled by IMA, with IMAGE playing no independent role. Despite this, the GST registration was taken solely in IMAGE’s name.
IMAGE operates from the premises of IMA’s headquarters in Thiruvananthapuram. Officials questioned why there were no rental receipts for the two if IMAGE and IMA were separate entities. The SGST department’s order stated, “Upon verifying the documents provided, it has come to our attention that you obtained GST registration using the documents of another taxpayer named M/s Indian Medical Association Kerala State Branch Trivandrum, rather than your own.”
The inquiry, launched on November 30, 2024, found that IMAGE was registered under the Kerala GST Act for dealing in waste scrap, biomedical waste management, and cleaning services. However, the contract for biomedical waste management was between IMA Kerala State Branch and M/s GJ Multiclave India Private Limited, with no documents proving IMAGE’s independent role in the agreement.
According to IMAGE, over 18,000 healthcare establishments rely on it for biomedical waste disposal. It has the capacity to handle 80 tonnes of biomedical waste per day and manages more than 82% of the total biomedical waste generated in Kerala.
If IMAGE’s functioning is brought to a halt, it will worsen the already shoddy management of biomedical waste in the state. Agencies in charge of managing such waste produced in Kerala’s hospitals are notorious for dumping untreated biomedical waste in neighbouring Tamil Nadu and Karnataka. For years, Kerala’s neighbours have raised health and environmental concerns arising from the illegal waste dumping.
Also read: Kerala’s problem of treating bio medical waste: Why sole plant in Palakkad is not enough
As recently as December 2024, the state had to clear 30 truckloads of waste from Tirunelveli in Tamil Nadu. In November 2024, six trucks carrying medical waste, animal carcasses, and plastic waste from Kerala were reportedly intercepted at the Bandipur Moolehole check post on the Kerala-Karnataka border, leading to the arrest of seven persons. The Karnataka government even wrote to the Kerala State Pollution Control Board seeking immediate intervention to stop the illegal transportation and dumping of waste across the state border.
Defending itself in the wake of the tax department’s order, IMAGE argued that it has been functioning from the same premises as IMA for over 16 years without a separate rental agreement, a fact known to tax authorities. It also emphasised its compliance record, stating it has paid over Rs 186 crore in GST since 2017 without any allegations of tax evasion or fake invoices. IMAGE further pointed out that all formalities were followed before its service tax registration was granted and later migrated to GST.
The organisation also said that even the Kerala government has an agreement with IMA Kerala State Branch regarding IMAGE’s operations. “This has been the recognised practice for nearly 20 years. Therefore, to seek to cancel the registration on this score is wholly arbitrary and would amount to the Finance/Revenue Department of the Government of Kerala acting contrary to the Health and Welfare Department of the Government of Kerala,” IMAGE countered.
However, the tax department maintained that IMAGE violated Rule 24(2) of the CGST/SGST Rules by misrepresenting itself as a separate legal entity. “There is no separate legal entity in the name of IMAGE; rather, it is only a wing/project of IMA Kerala State Branch. Hence, GST registration obtained in the legal name of IMAGE as an Association of Persons (AOP) was through willful misstatement and suppression of facts,” the order stated.
TNM reached out to the IMA for comment, but have yet to receive a response from them. Dr K Sasidharan, the state secretary, IMA told TNM that the case is under consideration of the High Court and declined to comment on the issue.
In March 2023, TNM’s Haritha John and Nithya Pandian published the series Kerala’s cross-border dump yards. The series involved ground investigations in villages in Tamil Nadu, which have become dump yards of almost every kind of waste, often unsegregated, from bordering Kerala. Read the stories here