AAR : 'Penal interest' collected for default in EMI re-payment, constitutes a 'supply', liable to GST

Nov 16,2018

Maharashtra AAR holds that penal/default interest collected by applicant, a non-banking financial company providing various types of loan, for delay in repayment of equated monthly installments (EMI), constitutes a 'supply' u/s 7 of CGST/MGST Act, 2017; Rejects applicant’s plea that such amount is exempt in terms of Sr. No. 27 of Notification No. 12/2017- Central Tax (Rate) which exempts services by way of extending loans in so far as the consideration is represented by way...

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