GST on service supplied by State Government to their undertakings or PSUs by way of guaranteeing loans taken by them - GST - States - CCT/26-4/2017-18/E/857

GOVERNMENT OF GOA Department of Finance Office of the Commissioner of Commercial Taxes CCT/26-4/2017-18/E/857 Circular (No. 7/2021-22-GST) Subject: GST on service supplied by State Government to their undertakings or PSUs by way of guaranteeing loans taken by them-reg. 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 Notification No. 38/1/2017--Fin(R C)(12/2017-Rate) dated 30-06-2017 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 undersigned. Hemant Kumar, IAS, Commissioner State Tax, Goa. Panaji, 6th July, 2021. Note: Similar circular under Central Goods and Services Tax Act, 2017 is issued by the Department of Revenue, Ministry of Finance, GOI, New Delhi vide Circular No. 154/10/2021- -GST dated 17th June, 2021.