Notice pay recoveries do not amount to ‘supply’ under GST, as same is compensation for breach of contract and not consideration for supply: Maharashtra AAR

The Authority for Advance Rulings, Maharashtra in the case of M/s. Ferrero India Pvt. Ltd. vide Case No.- GST-ARA-62/21-22/24-25/B-172 dated 27.03.2025, has ruled that recoveries from employees for canteen and transport (even if subsidized) are subject to GST.GST must be discharged on the amount recovered from employees. Only the portion subsidized/free may fall under Schedule III exemption (if fo…