Are services supplied without  consideration to a recipient other  than ‘related party’ / ‘distinct person’ taxable?

Section 7 of the CGST Act, 2017 read with Schedule I thereto provides that  services supplied without consideration to related persons or distinct persons only would qualify as ‘supply’. Also import of services by bank from a related person or from any of its establishments outside India in the course or  furtherance of business will be supply even if imported without consideration.

Therefore, where the services are supplied by a supplier without consideration  to an unrelated recipient or a person other than a related or distinct person, the same would not amount to supply and not liable to GST.

Q 31 of GST FAQs on Financial Services Sector published by CBIC