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FAQs on GST Penalties

Sakshi Jain
Sakshi Jain at March 13, 2023

GST Penalties Relevant FAQs

Q1. What do you understand by the term penalty?

Ans. The word penalty has not been defined either in CGST or SGST ACT. So we will take the definition that is admissible in the court of law:

The penalty is a monetary punishment imposed by any statute for committing any offence. Or any punishment is given for failing to perform any duty as mentioned in the law of contract.
Q2. What shall be the penalty for any contravention made by the taxpayer?

Ans. For any contravention of provisions of the CGST/SGST Act for which no separate has been prescribed for such contravention, the taxpayer can be penalized with the amount up to 25,000 INR as per Section 125 of the CGST Act.

Q3. What is the penalty if a person who is ineligible for opting composition scheme opts for it?

Ans. As per section 10(5) of the CGST Act, In case if a person who is not eligible to opt for the composition scheme opts for the same then he/she shall pay the total amount of tax that may incur as a normal taxable person along with the penalty prescribed.

Q4. Is it possible for the CGST Commissioner to revise an order passed by himself?

Ans. No, once the order passed by the CGST officer cannot be revised by the CGST commissioner. However, a subordinate of a GST officer can challenge the order passed by him/her in the First Appellate Authority. The appeal shall be made by subordinate shall highlight all the decisions that he thinks needs to be revised or changed.

Q5. What is the maximum duration to file an appeal with the First Appellate Authority?

Ans. The maximum duration during which one can appeal to the First Appellate Authority is 3 months from the date of order passed by the tax officer or commissioner. It shall be noted that this time limit remains the same for departmental appeals as well.


Q6. What are the powers of the First Appellate Authority?

Ans. The First Appellate Authority has the power to delay the appeal filing period for up to one month in addition to the 3 months prescribed period. Moreover, this authority can also add some grounds that have to be included while filing an appeal.

Q7. What is the amount of penalty that is prescribed in the CGST /SGST Act?

Ans. As per Section 122(1) of the CGST in case if any person commits an offence that is prescribed in section 122 of CGST Act shall be punished with the following prescribed penalty:

The amount of tax evaded or a sum of 10,000 INR whichever is higher. Moreover, As per section 122(2) of the CGST Act if any taxpayer who is not paying tax or making a short payment of tax on supplies shall be penalized either 10% of the tax not paid or short paid or 10,000 INR whichever is higher.
Q8. Is there a penalty for any person other than the taxable person?

Ans. Yes, any person other than taxpayer is also can be penalized with the amount up to 25,000 INR if-

  1. He/She commits any 21 listed offences
  2. He/She supplies or stores any goods that need to be confiscated,
  3. He/She supplies or receives any goods in contravention to the GST Act
  4. He/She does not appear before the court of law even after issuing a summon,
  5. He/She does not issue an invoice for a supply or does not show such supply in his or her books of accounts.
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