client has recieved 1.5cr for loss of project fromt the receipient. client has shown amount as a payable in his balance sheet.
whether gst is payable on receipt of 1.5 cr?
Can client shown amount received for loss of project and not related with sales activity in GST?
Compensation for project loss raises GST questions; experts say not taxable as no supply involved. Consult for clarity. A client received INR 1.5 crore as compensation for a project loss, raising questions about GST applicability. Experts suggest that GST is payable on advances when services are supplied, but compensation for breach of contract may not be taxable as it is not considered a supply. The amount should be classified as 'other income' rather than a payable in the balance sheet. It is advised to consult a professional to review contract details and determine the nature of the compensation to ascertain GST obligations accurately. (AI Summary)
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