Corporate Guarantee is taxable as Business Auxiliary Service under Section 65(105)(zzb) of the Finance Act

Last updated: 22 November 2023
Quick Summary
The Supreme Court has admitted an appeal concerning the taxability of corporate guarantees. Initially, the Revenue Department sought to tax the commission earned on corporate guarantees as 'Banking and other Financial Services'. However, the CESTAT ruled that corporate guarantees should be taxed as 'Business Auxiliary Service' instead. This decision was made because the Revenue Department failed to properly classify the service and lacked certainty in their tax assessment. The Supreme Court's admission of the appeal means this matter will be further reviewed.

Court :
Supreme Court of India

Brief :
Aggrieved by the Impugned Order, the Appellant filed Civil Appeal before the Hon’ble Supreme Court of India [Civil Appeal No. 2406-2407 of 2022] which has been admitted vide Order dated November 3, 2023. 

Citation :
Civil Appeal No. 2406-2407 of 2022

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Bimal Jain
Published in Income Tax
Views : 313
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