The refund policy of states that on cancellation of yearly membership scheme after fifteen days the gym will charge a equalisation charge of 15% and gst deduction of 18% on the entire yearly membership apart from pro rata usage deduction.
Equalisation charges: The price of the higher duration is highly subsidized as compared to buying smaller duration packs due to long term commitment. Premature termination of the pack will hence be subject to an equalisation fee to proportion the cost as in the case of a smaller duration pack purchase.
Firstly, I don’t think they have any rationale in charging me an equalisation charge, which I feel is a random charge.
Secondly,
How can they deduct the gst on full membership payment when they should actually charge gst only on the pro rata gym membership usage as they can themselves apply for part gst reversal (ITC) on return of membership after two months usage.
Your opinion on the legality of above two deductions would be appreciated.
A.Dear Sir,
Your stand is correct and you may get issue a strong legal notice claiming your amounts legally.
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Ankur Goel @ Complete Law Shield
Responded 3 years ago
A.Equalisation charges seems to be same like Bank FD rates.
if someone books FD for 3 years then get more interest but if that FD is broken in 3 months then bank gives only FD interest as per 3 months rates + they will deduct penalty of 1%.
a Gym monthly fees for 6 months is equal to annual membership.
and definitely you signed on terms and conditions of the same.
Hope this clarifies,
Advocate Ankur Goel (Complete Law Shield)
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Online Gym membership part refund
Mohamed Ayub Younus Shaikh
