Skip to main content
← back
Informative

Booking Cancellation Charges are Compensation for Breach of Contract, not Consideration for Service; No Service Tax Applies: CESTAT

Update / Judgement Date

07 Aug 2024

Source

Taxscan

Author

Team — WCP Legal Desk

Reading Time

1 min read

Excise, VAT & CustomGST

The CESTAT ruled that booking cancellation charges are compensation for breach of contract and not consideration for a service, thus not subject to service tax. This clarification distinguishes contractual compensations from taxable services, offering relief to businesses dealing with cancellations.