<h1>GST Exemption for Bank Penal Charges and Small Transactions by Payment Aggregators, Clarifies CBIC and GST Council.</h1> The Central Board of Indirect Taxes and Customs (CBIC) clarified that Goods and Services Tax (GST) will not apply to penal charges levied by banks and non-banking finance companies (NBFCs) for breaches of loan contract terms, as these charges are not considered taxable services. This decision, recommended by the 55th GST Council, aims to reduce financial burdens on regulated entities and borrowers. Additionally, GST exemption applies to Payment Aggregators for transactions up to Rs 2,000, distinguishing their role from Payment Gateways. These clarifications aim to enhance tax certainty and compliance with Reserve Bank of India (RBI) guidelines.