Question17: A UT administrator transfered fund x to a Govt.corporation to construct health centre & staff colony in March,2018. It is not sure whether Corporation will construct or not . What will be GST liability of corporation on X amount. whether GST is payable treating X as advance received.

Answer Advance against services is to be taxed but following are some points to be taken before charging of tax
1 There are many exemptions relating to service provided to the Goverment please check if any of them is applicable
2 The tax is in case of advance against service but not against goods see the terms of agreement if the same is against goods
3 Tax is not on security but on advance whether the amount is security or advance
4 it is not concern whether the corporation will work or not the liability of tax is as on date and will have to be discharged if the corporation not work in future it can take refund of the tax paid on advance(Reply dt. 20/4/2018)