Composition GST

A shop owner dealing in eligible goods under composition has a saving bank account and recieving Interest on deposited amount.

Is ineligibility under section 10 attracted?
As he is providing Service to bank for a consideration i.e interest although its exempt service.
Replies (4)
how he is providing service to bank infact he is receiving interest on his deposits. here supplier is bank not the person receiving such services.
We are depositing money in bank, in consideration we recieve Interest.

Its ok, If your point is right, then what is the need of exemption entry 27 No.09/2017
it writes that---

Services by way of-
a. extending deposits, advances, loans and consideration recieved as Interest/discount

now we are extending deposits to bank as FD/Saving A /c ....bank pays us interest

Please discuss.
I may be confused, as it cant happen as even a beggar has bank account im india.

how could this hardship happen to small business man?
But I am seeking justification in law ...thats it
s.no. 27 in E/N 12/2017 is for banks providing services by way of deposits and loans/advances where consideration is in form of intt, e.g. intt on SB FD OD CC etc., or by way of discount e.g. bill discounting etc.
these are exempted supply provided by bank not chargeable to GST.
Bhawna ji I got still confusion ...please see this order to remove gst hardship for restaurant service providers.

Reading your replies, I want to know what was the difficulty for Restaurants to apply Composition scheme.


please see this

1. This Order may be called the Central Goods and Services Tax (Removal of Difficulties) Order, 2017.
2. For the removal of difficulties,-

(i) it is hereby clarifiedthat if a person supplies goods and/or services referred to in clause (b) of paragraph 6 of Schedule II of the said Actand also supplies any exempt services including services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount, the said personshall not be ineligible for the composition scheme under section 10 subject to the fulfilment of all other conditions specified therein.

(ii) it is further clarified that in computing his aggregate turnover in order to determine his eligibility for composition scheme, value of supply of any exempt services including services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount, shall not be taken into account.

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