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Whether deduction of Liquidity Damage (LD)/Penalty deduction from contractor’s bills and charging Penalty for non-lifting of coal till targeted minimum level to Annual Contractual Quantity (ACQ) will attract GST?

QuestionsCategory: GSTWhether deduction of Liquidity Damage (LD)/Penalty deduction from contractor’s bills and charging Penalty for non-lifting of coal till targeted minimum level to Annual Contractual Quantity (ACQ) will attract GST?
NidhiJain asked 5 months ago

Whether deduction of Liquidity Damage (LD)/Penalty deduction from contractor’s bills and charging Penalty for non-lifting of coal till targeted minimum level to Annual Contractual Quantity (ACQ) will attract GST?

1 Answers
AayushPareek answered 5 months ago

Yes, it is a service being “tolerating an act” as per Schedule II of the CGST Act,2017 thus GST shall apply.