https://www.taxtmi.com/circulars?id=71368 GST applies to payments for refraining, tolerating or doing an act only where an express or implied agreement creates a specific obligation and consideration is paid for an independent supply. Liquidated damages, statutory penalties, cheque-dishonour fines, employment-bond recoveries and compensation for breach are not taxable where they merely compensate loss, deter default or penalise violations without any reciprocal supply. Conversely, late-payment fees, early-termination charges and cancellation amounts may be ancillary consideration naturally bundled with the principal supply and are assessed according to that supply. en-us Sat, 17 Sep 2022 00:00:00 +0530 Sat, 19 Sep 2026 09:48:56 +0530 TaxTMI RSS Generator https://www.taxtmi.com/circulars?id=71368 GST applies to payments for refraining, tolerating or doing an act only where an express or implied agreement creates a specific obligation and consideration is paid for an independent supply. Liquidated damages, statutory penalties, cheque-dishonour fines, employment-bond recoveries and compensation for breach are not taxable where they merely compensate loss, deter default or penalise violations without any reciprocal supply. Conversely, late-payment fees, early-termination charges and cancellation amounts may be ancillary consideration naturally bundled with the principal supply and are assessed according to that supply. Circulars GST - States Sat, 17 Sep 2022 00:00:00 +0530 https://www.taxtmi.com/circulars?id=71368