GST Penalties And Appeals

Offences in GST

Depending on various groups, there are a total of 21 offences according to the GST law. The offences and GST penalties are as mentioned below:

Fake invoices:

• The supplier issues a fake invoice or supply of the goods without an invoice.
• The supplier issues the invoice without the supply of goods and services violating the GST provisions.
• Also, the supplier issues the invoice in the name of another taxable person or on their GST number.

False information:

• Submission of wrong personal or professional information while registering for GST.
• Submission of fake financial records or filing fake tax returns for tax evasion.
• Fails to provide the information while registration.

Tax evasion:

• The supplier collects the GST but does not submit it to the government according to GST provisions for 3 months or more.
• In any contravention of provisions, if the supplier collects GST from the taxpayers, he has to mandatorily submit it to the government. In case he cannot do so, he will have to face GST penalties.
• The supplier tries to obtain the GST refund amount through fraud.
• Utilization of the input tax credit without a proper receipt of the goods and services supplied.
• Suppression of sales knowingly for tax evasion.

Transport/Supply of goods:

• Transportation of the goods by the supply from one place to another without proper documents.
• The supplier supplies the prohibited goods which can be confiscated.
• Destruction of the seized goods.

Others

• Not registering under GST even though an individual is eligible for the same.
• Not deducting the TDS wherever applicable.
• The Input Service Distributor collects tax credits by violating the rules.
• Not collecting the TCS wherever applicable.
• Obstruction of any authority or officer from performing their duty.
• Fails to maintain the documents and records as mentioned by the law.
• Destruction of evidence in case of violation of laws.

In the case of an LLP, HUF or other companies, it will hold all the directors and partners liable for GST penalties and interest.

GST penalties and interest

In the case of any offence, the individual or the company has to mandatorily pay the penalties and interest according to the law. The GST penalties and interest include:

• Late filing:

  They charge the GST penalties for late filing at ₹100 for each day. The total GST penalties for late filing will be ₹200 for each including the CGST and SGST. They can increase the GST penalties for late filing to a maximum of ₹5,000. Along with this, one has to pay the tax at 18%/annum.

• Not filing:

  In case, one fails to file any one of the GST, then, they cannot file the subsequent forms before filing the pending one.

• For the 21 offenses, making fraud intentionally or unintentionally:

  The individual or the company may have to pay a penalty of 10% or up to ₹10,000. The additional penalties may involve a term in jail for several years depending on the tax amount.

Appeals under GST

Any individual who is unsatisfied with the decision made for them by the authorities can appeal for the reversal of the order. The flow of appeal goes as follows:

1.First appellate authority

2.Appellate tribunal

3.High court

4.Supreme court

If the individual wants the authorities to decide faster, they can even opt for ‘advance ruling under GST’.

Conclusion

To avoid any legal consequences and issues, one must mandatorily file all the GST returns according to the timeline. Else, apart from the penalties, the authorities also have the right to inspect and seize the business in case of illegal actions, following which one may be prosecuted under legal charges.