Summary
- The Karnataka High Court ruled that GST cannot be deducted from compensation for land acquisition, stating that such acquisition does not constitute a supply of goods or services.
- The case involved the compulsory acquisition of a house property for highway widening, where Rs.12,28,906 was wrongfully deducted as GST from the compensation of Rs.96,92,624.80.
- The Court emphasized that the acquisition is an expropriation under eminent domain and not a voluntary transaction involving goods or services.
- This ruling mandates a refund of the deducted GST with interest and personal liability for recovery from the official responsible for the deduction.
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