https://www.taxtmi.com/caselaws?id=446825 AAR Karnataka ruled that damages received by a landlord from tenant for early termination of sub-lease before lock-in period constitutes consideration for supply of facility under GST Act. The authority held that such payments, though termed as damages or penalty, are actually consideration for taxable supply of services. Following CBIC circular 178/10/2022, these amounts are subject to GST as they represent supply of early termination facility ancillary to principal supply of sub-letting commercial property. The services are classified under chapter 9972 - Real Estate Services, attracting 18% GST (9% CGST + 9% SGST). en-us Thu, 16 Nov 2023 00:00:00 +0530 Wed, 23 Apr 2025 13:14:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=446825 AAR Karnataka ruled that damages received by a landlord from tenant for early termination of sub-lease before lock-in period constitutes consideration for supply of facility under GST Act. The authority held that such payments, though termed as damages or penalty, are actually consideration for taxable supply of services. Following CBIC circular 178/10/2022, these amounts are subject to GST as they represent supply of early termination facility ancillary to principal supply of sub-letting commercial property. The services are classified under chapter 9972 - Real Estate Services, attracting 18% GST (9% CGST + 9% SGST). Case-Laws GST Thu, 16 Nov 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=446825