No GST on notice pay recovery by employer for premature quitting of employee: HC
- Blog|News|GST & Customs|
- < 1 minute
- By Taxmann
- |
- Last Updated on 20 December, 2022
Latest from Taxmann
Case Details: Manappuram Finance Ltd. v. Assistant Commissioner of Central Tax and Excise - [2022] 145 taxmann.com 422 (Kerala)
Judiciary and Counsel Details
-
- Gopinath P., J.
- V. Raghuraman, K.S. Bharathan, Alphin Antony, Aadithyan S. Mannali, Visakh Antony, Christine Mathew & Rance R., Advs. for the Appellant.
- Sreejith P.R., Adv. for the Respondent.
Facts of the Case
In the instant case, the issue was whether petitioner-employer liable to pay tax on notice pay received from its former employees. The writ petition was filed by the petitioner against the order of appellate authority which rejected the claim for refund made by the petitioner for a refund of GST paid on notice pay received from the erstwhile employees. It submitted that it had no other remedy since the GST Appellate Tribunal has not been constituted.
High Court Held
The Honorable High Court noted that the CBIC has already clarified through Circular No. 178/10/2022-GST, dated 3-8-2022 that amounts recovered by employer not as consideration for tolerating act of such premature quitting of employment but as penalties and therefore employer would not be liable to pay GST on notice pay. The Circular is binding on Department and since Circular is clarificatory in nature so it would apply retrospectively. Therefore, it was held that order rejecting refund of GST paid on notice pay received from erstwhile employees was liable to be quashed.
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
