Goods and Services Tax – Started By: – Kaustubh Karandikar – Dated:- 25-11-2018 Last Replied Date:- 3-12-2018 – XYZ is receiving from PQR amount towards late delivery charges which will fall under the category of agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act and therefore XYZ will be liable to pay GST on the amount received. In this example, recipient of service is XYZ or PQR? – Reply By KASTURI SETHI – The Reply = Tolerating, refraining from, agreeing to etc.is a service under GST. Who is tolerating ? Who is refraining from ? Who is agreeing to ? . XYZ is tolerating, refraining from, agreeing to by way of imposing late delivery charges upon PQR . So PQR is service receiver. – Repl
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recipient (PQR) and one booking income (XYZ) shall always be supplier. As per section 15(2)(d) value of supply include interest or late fee or penalty for delayed payment of any consideration for any supply. Therefore the POS for late payment charges shall be equivalent to original supply. – Reply By Alkesh Jani – The Reply = Dear Kaustubh Karandikar, In this regards, first of all it is to be decided that, late delivery charges received by the XYZ, is in relation to any Supply i.e. Goods or Services?. If this is the case, than PQR has already raised an Invoice and XYZ will deduct the amount of late delivery charges, this amount is to be included for valuation purpose, as per above mentioned section. but as Invoice of the same amount is rais
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