Interest & penalty recovered from defaulting chit subscribers exempt from GST: AP HC

Ushabala Chits Private Limited Vs Commissionner of State Tax (Andhra Pradesh High Court) The petitioner, a chit fund company, challenged rulings passed by the Authority for Advance Ruling and the Appellate Authority for Advance Ruling which held that interest, late fee, or penalty collected from defaulting chit subscribers for delayed payment of installments formed part of the value of taxable services and was liable to GST at 12%. The petitioner conducts chit schemes regulated by the Chit Funds Act, 1982 and the Andhra Pradesh Chit Funds Rules, 2008. Under the chit mechanism, subscribers pay ...