9911796707
TMI BlogClarification regarding taxability of supply of securities under Securities Lending Scheme, 1997X X X X Extracts X X X X X X X X Extracts X X X X ..... MMERCIAL TAXES CIRCULAR No. GST-24/2019-20 Subject: Clarification regarding taxability of supply of securities under Securities Lending Scheme, 1997 - reg. Trade has requested clarification on whether the supply of securities under Securities Lending Scheme, 1997 ("Scheme") by the lender is taxable under GST. 2. Securities and Exchange Board of India (SEBI) has prescribed the Securiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epicted in the diagram below: - 2.2 In the above chart: (i) Lender is a person who deposits the securities registered in his name or in the name of any other person duly authorised on his behalf with an approved intermediary for the purpose of lending under the scheme. (ii) Borrower is a person who borrows the securities under the scheme through an approved intermediary. (iii) Approved interme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arate consideration is charged; 4. Securities as defined in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (Central Act 42 of 1956) are not covered in the definition of goods under section 2(52) and services under section 2(102) of the KGST Act. Therefore, a transaction in securities is not a supply under GST law and hence not taxable. 4.1 The activity of lending of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions in securities" was only clarificatory in nature and does not have any bearing on the taxability of this service in past since 01.07.2017. 4.3 Apart from above, the activities of the intermediaries facilitating lending and borrowing of securities for commission or fee are also taxable separately. 5. The supply of lending of securities under the scheme is classifiable under heading 9971 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
