Delayed loan EMI? Cough up 18% GST on penal interest

The  GST Authority for Advance Rulings (GST-AAR),  Maharashtra , has held that penal interest paid by a customer for delay in payments of equated monthly instalments to a finance company is subject to GST.  Experts hold that this ruling, which has recently been made publicly available, will pinch the pockets of customers and may also lead to litigation. While advance rulings are bin…