IRCTC or The Indian Railway Catering And Tourism Corporation handles the ever-changing needs of its passengers throughout the year. As it’s undoubtedly the most convenient and cost-effective method of travelling, trains are the most favoured by the travellers, especially when the journey is too long. That’s why, to make sure of having a seat, passengers often buy tickets in advance, some even book seat months before their travel date, and then regret it.
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Many passengers are forced to cancel their confirmed tickets due to the end time change of plans. And when they do so, IRCTC charges a cancellation fee and many passengers object to it. So, for more clarification Railway has recently released a circular which clarified the Railway’s confirmed ticket cancellation charges, especially the GST part.
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According to a circular issued by the Tax Research Unit, Finance Ministry, GST charges will be levied when cancelling train tickets or hotel bookings.
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Circular further explains that by booking a train ticket you bound yourself under a contract in which a service provider promises to offer its special services to you for which you are willing to pay. Thus, if the contract is breached by you (passenger) by cancelling the train ticket then the service provider gets a compensation amount as cancellation charges.
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Moreover, cancelling a train ticket for a specific class attracts GST at the same charge which was applicable on the class of travel.
