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Sep 22, 2018
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State appellate body upholds GST on liquidated damages
In a ruling that may have an impact on several construction and renovation contracts and contract cancellations, Maharashtra Appellate Authority for Advance Rulings (AAAR) has upheld a levy of GST on liquidated damages collected by a power generation firm for a delay in project completion. Liquidated damages are fines levied by the owner of a project to the contractor in case of cancellation or delay of trial operation within the specified time period in the contract.
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