{"id":76511,"date":"2026-09-01T08:26:22","date_gmt":"2026-09-01T08:26:22","guid":{"rendered":""},"modified":"2026-09-01T08:26:22","modified_gmt":"2026-09-01T08:26:22","slug":"employee-stock-shortage-penalties-do-not-constitute-consideration-for-services-preventing-gst-collection-under-schedule-ii-in-employment-relationships","status":"publish","type":"post","link":"https:\/\/goodsandservicetax.in\/GST\/?p=76511","title":{"rendered":"Employee stock-shortage penalties do not constitute consideration for services, preventing GST collection under Schedule II in employment relationships."},"content":{"rendered":"<p>Employee stock-shortage penalties do not constitute consideration for services, preventing GST collection under Schedule II in employment relationships.<br \/>Case-Laws<br \/>GST<br \/>GST cannot be collected on a penalty imposed on an employee for stock shortage merely because an employment relationship exists. Paragraph 5(e) of Schedule II to the CGST Act applies to agreements connected with a supply of services. A stock-shortage penalty arising from the employer-employee relationship is not, without more, consideration for a supply of services. Accordingly, that provision does not authorise GST on such recovery. The de novo enquiry concerning the collection was sustained, while the intra-court appeal was dismissed.<br \/> TMI Updates &#8211; Highlights, quick notes, marquee, annotation, news, alerts <\/p>\n<p align=\"center\">=  =  =  =  =  =  =  =<\/p>\n<p align=\"center\"><strong>Plain text (Extract) only<\/strong><BR>For full text:-<a href=\"https:\/\/www.taxtmi.com\/highlights?id=103295\">Visit the Source <\/a><\/p>\n<p align=\"center\">=  =  =  =  =  =  =  =<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Employee stock-shortage penalties do not constitute consideration for services, preventing GST collection under Schedule II in employment relationships.Case-LawsGSTGST cannot be collected on a penalty imposed on an employee for stock shortage merely be&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"close","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-76511","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/76511","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=76511"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/76511\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=76511"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=76511"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=76511"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}