GST on service supplied by State Govt. to their undertakings or PSUs by way of guaranteeing loans taken by them - GST - States - CIRCULAR No. 09/2021(STATE)

File No.REV03-12039(31)/54/2021-AC-GST-CCT Government of Andhra Pradesh Commercial Taxes Department Proceedings of the Chief Commissioner of State Tax, Andhra Pradesh CIRCULAR No. 09/2021(STATE) IN REFERENCE TO 154/10/2021(CENTRAL), 02/07/2021 Sub:- GST on service supplied by State Govt. to their undertakings or PSUs by way of guaranteeing loans taken by them reg. Ref:- From the GOI, MOF, DOR, Circular No.154/10/2021-GST, dated 17-06-2021. Certain representations have been received requesting for clarification regarding applicability of GST on supply of service by State Govt. to their undertakings or PSUs by way of guaranteeing loans. The issue was examined by GST Council in its 43rd meeting held on 28th May, 2021. 2. Entry No. 34A of the notification issued in the G.O.Ms.No.588, Revenue (Commercial Taxes-II) Department, dated 12-12-2017 (Notification no. 12/2017-Central Tax (Rate) dated 28.06.2017) exempts Services supplied by Central Government, State Government, Union territory to their undertakings or Public Sector Undertakings (PSUs) by way of guaranteeing the loans taken by such undertakings or PSUs from the banking companies and financial institutions . 3. Accordingly, as recommended by the Council, it is re-iterated that guaranteeing of loans by Central or State Government for their undertaking or PSU is specifically exempt under said entry No. 34A. 4. Difficulty, if any, in the implementation of this circular may be brought to the notice of the Chief Commissioner. Peeyush Kumar Commissioner