9911796707
TMI Blog2019 (8) TMI 1221X X X X Extracts X X X X X X X X Extracts X X X X ..... ther charges, provided by way of loans to Gujarat state owned entities - Applicant is not charging any processing fees/ any other charges, for providing to Government of Gujarat State owned entities, and interest being charged as full consideration. HELD THAT:- The applicant makes the supply of loan and for which consideration is only interest. As stated by the applicant there is no other consideration so even if the service is provided to related party the applicant will be eligible for exemption under sub entry (a) of entry 27 of Notification No. 12/2017-Central Tax (Rate) under CGST Act 2017 and corresponding State notification No. 12/2017- State Tax (Rate) under GGST Act 2017. The said notification neither talks about related unrel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tated owned entities and GSFS become related persons in GST? 2. The Applicant is not charging any processing fees/ any other charges, for providing to Government of Gujarat State owned entities, and interest being charged as full consideration, then whether GST will be chargeable on, notional processing fees/ notional any other charges, provided by way of loans to Gujarat state owned entities? 3. The applicant submitted that as per direction of Gujarat State Government all the State Government owned entities are required to park all their surplus funds with Gujarat State Financial Services ltd (i.e GSFS). The funds received by GSFS from the Government entities are provided to the other state owned entities in the form of financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charges or amounts collected over and above the interest or discount would represent taxable consideration and hence liable to GST. In case of GSFS, no charges other than interest are collected from client. 3.2 The applicant submitted that they are receiving interest as consideration from various Government of Gujarat entities to whom financial assistance is provided. As a policy of the company, it is not charging any processing fees or any other charges for providing financial assistance to any clients i.e. from any Government entities. 3.3 They further submitted that there is no specific RBI guideline that a Bank or Non-Banking Financial Institution has to compulsorily charge processing fees to clients on financial assistance provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Heading 9971 Services by way of- (a) extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit services); Nil Nil 4.1 We have considered the submissions made by the applicant in their application for advance ruling. 4.2 We find that the applicant makes the supply of loan and for which consideration is only interest. As stated by the applicant there is no other consideration so even if the service is provided to related party the applicant will be eligible for exemption under sub entry (a) of entry 27 of Notification No. 12/2017-Central Tax (Rate) under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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