Go Ad-Free on CAclubindia with Daily Mobile Updates. Subscribe Now!

GST on interest payable to Greater Noida Authority

Pankaj Arora (Learner) (3134 Points)

15 May 2018

Hi..

ABC LTD ACQUIRED LAND ON 90 YEARS LEASE FROM GREATER NOIDA AUTHORITY, WE HAVE TO PAY TOTAL 8CR INCLUDING INTEREST OF 2 CR.

GREATER NOIDA AUTHORITY IS REGISTERED AS LOCAL AUTHORITY UNDER GST, MY QUERY IS WHETHER AUTHORITY WILL CHARGE US GST ON INTEREST COMPONENT.

PLEASE SHARE YOUR VIEWS..

Reply
Follow
Share

3 Replies

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 15 May 2018

As per notification 12/2017 CT (r) Sno. 27 , the interest is exempted , so i dont think that Authority will charge GST on interest

Upgrade to CAclubindia Pro. Subscribe Now!

Pankaj Arora (Learner) (3134 Points)
Replied 15 May 2018

BUT I DON'T THINK THAT INTEREST PAYABLR TO AUTHORITY FALLS IN THIS EXEMPTION HEADING

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 card services); (b) inter se sale or purchase of foreign currency amongst banks or authorised dealers of foreign exchange or amongst banks and such dealers

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 16 May 2018

Yes , interest might be exempted as on lease primium there is no GST , but interest being charged by authority is sort of late fee in shape of interest .
As per section 15 CGST such interest & late fee is added to accessible value , but your lease primium is exempted so the interest paid on same might be exempted.