Escorts Kubota Faces ₹22.95 Lakh Penalty for IGST Delay; Plans to Appeal
By: Admin
Date: September 21, 2024
Categories: GST Recent News
Reading Time: 4 Min
Escorts Kubota Limited has received a penalty of ₹22.95 lakh from the Joint Commissioner of GST, Faridabad, Haryana. This penalty stems from a delay in paying the Integrated Goods and Services Tax (IGST) under the reverse charge mechanism. The order, issued under the GST Act, includes both the penalty and interest for the late payment, as indicated in the company’s exchange filing.
In response to this order, Escorts Kubota plans to appeal the decision. The company aims to contest the imposed penalty and interest.
What is the Reverse Charge Mechanism (RCM)?
The reverse charge mechanism shifts the responsibility for tax payment from the supplier to the recipient of goods or services. Therefore, when a company like Escorts Kubota delays IGST payment, it can face significant penalties and interest charges.
Our Comments:
This penalty underscores the critical need for timely compliance with GST obligations, especially concerning the reverse charge mechanism. Companies must streamline their processes for IGST payments to avoid similar financial repercussions. As Escorts Kubota prepares to appeal, the outcome could set important precedents for future cases.
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