Now pay GST on even cancelled ticket cost

Cancellation of confirmed train tickets, too, will now attract GST, on cancellation charges for that particular class of travel, according to a circular issued by the Ministry of Finance on August 3.

Why GST on cancellation?
The circular – issued by the ministry's Tax Research Unit (TRU), – explains that booking of tickets is a ‘contract’, under which the service provider (IRCTC/Indian Railways) promises to provide services to the customer.
“When the contract is breached by the passenger, the service provider is compensated with a small amount, collected as a cancellation charge. Since the cancellation charge is a payment, and not breach of contract, it will attract GST,” the notification said.
For cancelling bookings of a particular class, the GST rate will be the same as that applicable while booking seats/berths for that class, it added. For example, the rate is 5% for first-class or AC coaches, while cancellation fee for this category is ₹240 (per passenger). Therefore, the total cancellation cost will be ₹252 ( ₹12 tax+ ₹240) for first-class/AC compartments more  

View all 18 comments Below 18 comments
I think the Central Govt has become berserk. We do not know in what direction they are going. more  
Openly looting and taking people at ride. First of all cancellation charges are too high (Rs. 240 etc). Seats are always booked and earning multiple times for same seat is not justified. As said by some members that railway should pay travelers in case of delay , cancellation poor AC ,no water etc in the trains more  
Railways are taking public for a ride . If cancellation of railway ticket is breach of contract , then similarly , late running of trains is also breach of contract , as in the contract document ,i.e., in the railway ticket, it is clearly printed , the scheduled departure & arrival time at the destination , hence railways to ensure , to run trains on scheduled times , or else make refund to all affected passengers . This calls for serious consideratin by the railways . more  
Don't book ticket unless sure & don't cancel unless it necessary. This will reduce no. Of Cancellations & un-Necessary booking also. more  
If Railway wants to collect GST on cancellation of Train ticket then they should repay Interest for enjoying the amount for the same period .Secondly if we cancel the Tickets then as other normally party also refunds the GST the the authorities also refund the same to all customers.   On Tuesday, 30 August, 2022 at 04:10:12 pm IST, RN Chopra wrote: more  
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