No Service Tax on Forfeited Earnest Money Deposits, as per CBIC Circular Dated February 28, 2023.

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Full Text of the Document

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....Levy of Service tax - Forfeiture of earnest money deposit on account of contractors failure to honor the terms of the contract - The Circular dated 28.02.2023 issued by the Central Board of Indirect Tax and Customs also provides that service tax cannot be levied on the amount collected for the said purpose - thus demand on contractual agreement do not sustain. - AT....