https://www.taxtmi.com/forum/issue?id=116496 When an export order is cancelled and part of an advance is refunded while part is retained as cancellation or recovery charges, refunds made before one year generally do not require RBI approval but banks may impose documentary requirements. The retained amount should be examined against contract terms and accounting standards to decide recognition as income or a charge. For GST, retention is typically not leviable because mere retention for breach does not constitute supply, and if treated as supply it would be zero rated provided procedural conditions such as execution of a Letter of Undertaking are met. en-us Sat, 20 Jun 2020 10:03:31 +0530 Thu, 23 Jan 2025 15:54:43 +0530 TaxTMI RSS Generator https://www.taxtmi.com/forum/issue?id=116496 When an export order is cancelled and part of an advance is refunded while part is retained as cancellation or recovery charges, refunds made before one year generally do not require RBI approval but banks may impose documentary requirements. The retained amount should be examined against contract terms and accounting standards to decide recognition as income or a charge. For GST, retention is typically not leviable because mere retention for breach does not constitute supply, and if treated as supply it would be zero rated provided procedural conditions such as execution of a Letter of Undertaking are met. Discussion-Forum FEMA Sat, 20 Jun 2020 10:03:31 +0530 https://www.taxtmi.com/forum/issue?id=116496