Recovery of Compensation Cess from employees after restructuring of GST

Dear Client,

Increase in EMI due to GST or compensation cess can be passed on to you only if your lease agreement specifically allows recovery of such tax changes. If there is no clause permitting this, the lease company cannot unilaterally increase EMIs.

You should review the agreement and send a written representation to the lease company asking for legal basis of such recovery, especially if they are eligible to claim input tax credit or refund. Practices may differ across companies depending on their agreements and policies.

If the demand is not justified, you may dispute it and seek correction or refund. Please consult a local advocate for proper review and action.

Dear Client,

Based on the facts provided, the issue depends on the terms of your lease agreement. Generally, any increase in EMI due to tax changes like GST or compensation cess can be passed on to the lessee only if the agreement specifically allows such variation. If your agreement does not clearly permit recovery of additional tax or cess from you, the lease company may not have a legal right to increase EMIs unilaterally.

You should review the lease agreement for clauses relating to tax changes, statutory variations, or pass through charges. If such clause exists, the increase may be valid. If not, you can object in writing and seek justification for recovery of compensation cess, especially if the company is eligible to claim input tax credit or refund.

If the lease company continues to charge without proper contractual basis, you may issue a legal notice and seek correction or refund of excess amount paid. The information provided is limited and the agreement terms are crucial, so please consult a local advocate for proper review and action.