In a significant ruling, the Bombay High Court in Mumbai has overturned a ₹33.80 crore Goods and Services Tax (GST) demand imposed on the University of Mumbai regarding its affiliation fees. The court described the tax demand as 'gross absurdity,' asserting that the university's statutory functions, as governed by the Maharashtra Public Universities Act, 2016, should not be classified as business activities. The court emphasized that treating such functions as commercial would undermine the purpose of the legislation. The university contended that affiliation fees are integral to its regulatory role and lack profit motives, thus not qualifying as taxable services under GST law. While GST authorities maintained that the university's activities fell within the ambit of taxable services, the court rejected this interpretation, stating that statutory functions like granting affiliations do not meet the criteria for 'supply' under the GST provisions. This ruling clarifies the legal standing of educational institutions concerning taxation, reinforcing the separation between educational and commercial functions.