GST Applicability on Bad Debts Recovered

This discussion explores whether Goods and Services Tax (GST) applies to bad debts that were written off in FY 2018-19 but subsequently recovered in FY 2020-21. The general consensus suggests that GST is not applicable on the recovery of the principal amount of a bad debt, as GST was already paid at the time of the original sale. However, if the recovered amount includes interest, then GST would be applicable on the interest component.