GST – GST Law and Procedure – 051 – Chapter Fifty One Recovery of Tax 1. All tax administration occasionally comes across a situation where the tax dues are not paid correctly by the tax payers, most of the times inadvertently and sometimes deliberately. To minimise the inadvertent short payment of taxes the concept of Matching of details of Outward supplies of supplier with the details of Inward supplies of recipient has been introduced in the GST Act. Moreover, the self-assessed tax has to be paid by due date prescribed under the GST Act and in case of any failure to pay the same by due date the Input Tax Credit will not be available to his customers and also the tax payer will not be able to file any return for further period. Effectually these provisions works as a Self-Policing system and takes care of any mis-match in the payment of taxes. However, despite these provisions there may arise some instances where the tax was not paid correctly. To deal with all such situations the p
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limit/incidence. The Table below gives a comprehensive chart of provisions for voluntary compliance:- Sr.No. Action by Tax Payer Amount of Penalty payable-Normal Cases Amount of Penalty payable-Fraud Cases Remarks 1. Tax amount, along with interest, aid before issuance of Notice. No Penalty and no Notice shall be issued. 15% of the Tax amount and no Notice shall be issued. The penalty shall also be not chargeable in cases Where the self-assessed tax or any amount collected as tax is paid (with interest) within 30 days from the due date of payment. 2. Tax amount, along with interest, paid within 30 days of issuance of Notice. No Penalty. All proceedings deemed to be concluded. 25% of the Tax amount. All proceedings deemed to be concluded. 3. Tax amount, along with interest, paid within 30 days of communication of Order. 10% of the Tax amount or ₹ 10,000/-, whichever is higher 50% of the Tax amount. All proceedings deemed to be concluded. 4. Tax amount, along with interest, paid af
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becomes inevitable to issue a show cause notice and thereafter pass an Order, the GST Act ensures a timely completion of all these procedures by providing a fixed timeline for issuance of notice and order-as follows:- Sr. No. Nature of Case Time for issuance of Notice Time for issuance of Order 1. Normal Cases Within 2 years and 9 months from the due date of filing of Annual Return for the Financial Year to which the demand pertains or from date of erroneous refund. Within 3 years from the due date of filing of Annual Return for the Financial Year to which the demand pertains or from date of erroneous refund. 2. Fraud Cases Within 4 years and 6 months from the due date of filing of Annual Return for the Financial Year to which the demand pertains or from date of erroneous refund. Within 5 years from the due date of filing of Annual Return for the Financial Year to which the demand pertains or from date of erroneous refund. 3. Any amount collected as tax but not paid No time limit. With
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re are sufficient opportunities to make amend and discharge the tax liability with nil or nominal penalties. However, there are disincentives also for the person who fails to utilise these beneficial provisions. Besides that, the law also provides that the Board may fix certain monetary limits for not filing an Appeal against any order. It means if any order is passed in favour of the assessee the department will not pursue the case further by filing Appeals if the amount involved is less than the specified limit. At present, under the existing laws, the monetary limits for not filing an appeal to various judicial forums are follows: – i. Tribunal- ₹ 10 Lakhs ii. High Courts- ₹ 20 Lakhs and iii. Supreme Court- ₹ 25 Lakhs 5. The recovery proceedings are final step towards realization of any tax or amount, which has been confirmed as payable after following the due process of adjudication by the proper officer. Therefore, if the tax dues and other amounts remain unpaid,
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