Issue of leviability of tax on liquidated damages to be decided as per circular no. 178/10/2022-GST

Linde Engineering India Private Limited Vs C.C.E. & S.T. (CESTAT Ahmedabad) CESTAT Ahmedabad held that issue of leviability of tax on liquidated damages is to be decided as per clarification provided by CBIC vide circular no. 178/10/2022-GST. The circular mainly clarifies that liquidated damages are mere flow of money from party who causes a breach of contract to party who suffers loss due to such breach, then such payments do not constitute consideration for supply and are not taxable. Facts- This appeal has been filed by M/s. Linde Engineering India Private Limited against confirmation o...