Upgrad LLM

service tax on interest portion?

director

 

today I was surprized to know that banks are asking for service tax on int amount on loan given on the basis of CC  it     "CASH ON CALL"

suppose Im getting a loan of 4lac @ 14 %PA ,for 24 month then EMI will be Rs 19,205.15

and the total interest paid in 24 month is Rs 60,923.60 so bank charge 10.3 on 60923.60. i.e. 6275.13

is this ok.

 

Im already paying EMI on car loan and Home loan to other bank... they are not charging this service tax.

what to do with this new loan offer of Rs 4 lac.

 

 
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MANAGING DIRECTOR

Visit RBI and check for banking norms for charging of Service Tax even in case of Co-Op banks 

visit service tax online and check for the same details of charging 

Best Regards

Shivakumar 

 
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Advocate

If service tax was mentioned in the contract/agreement  while availing of the loan, in addition to agreed interest, then bank is justified in charging service tax.

 
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