Applicability of service tax on processing fees

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

04 May 2012 Is Service Tax applicable on Loan Processing Fees (Micro Finance Loan ) charged by NBFC. Will it come under "Banking and other financial services". Any notification/ circular for exemption of this service.

Guest

Guest (Expert)

04 May 2012 Yes ST is applicable on loan processing fees. As such there is no circular on exemption. I myself have paid Proc fees with ST being charged on it

Querist : Anonymous

Querist : Anonymous (Querist)

12 May 2012 NBFC whose main operation is group lending or giving Micro Finance or giving loan to group i.e Self Help Group. Herein this NBFC Charged loan processing fees as 1% of Principle amount of Loan. But these NBFC is not charging any service tax nor paying service Tax even though their proccessing fees exceeds 10 lacs yearly. Is service tax applicable or not to this company ?

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