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SECTION 122. PENALTY FOR CERTAIN OFFENCES. - Goods and Services Tax - GSTExtract Section 122 - Penalty for certain offences under the GST Act . 122. (1) Where a taxable person who This section declares the offences that attract penalty as a consequence, apart from the requirement to pay the tax and applicable interest In other words, the first sub-section (1) prescribes 21 types of offences, any one of which, if committed, can attract penalty of ten thousand rupees or equal to the amount of tax involved, whichever is higher. Section 122 (2) - Any registered person who supplies any goods or services or both on which any tax has not been paid or short-paid or erroneously refunded, or where the input tax credit has been wrongly availed or utilised,- (a) for any reason, other than the reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty of ten thousand rupees or ten per cent of the tax due from such person, whichever is higher. (b) for reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty equal to ten thousand rupees or the tax due from such person, whichever is higher. QUERY. Looking at the above provisions closely, there is one conspicuous difference in the opening words of Section 122(1) and 122(2) . It is like this, Section 122(1) speaks about a taxable person whereas Section 122(2) speaks about any registered person . Further careful reading of the penalty rates, there is substantial reduction of penalty in respect of offences committed by any registered person under Section 122(2) when compared to the beginning provision of Section 122(1) in respect of a taxable person. Legal position being so, what are the significant qualities or circumstances which entitles any registered person under Section 122(2) to avail the benefit of relatively reduced rate of penalty? Why this differential treatment between a taxable person and any registered person? Experts are requested to enlighten in detail on this query in the larger interest of all stake holders. Regards.
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