Kerala GST Dept Clarifies Penalty Calculation Under IGST Act for SCNs Issued u/s 73(1)/74(1) of KSGST Act
By: Admin
Date: August 13, 2024
Categories: GST Recent News
Reading Time: 4 Min
The Kerala SGST Policy Division, through Circular No.12/2024-Kerala SGST dated August 13, 2024, has clarified the manner of penalty calculation under the IGST Act, 2017, specifically for the show cause notices (SCNs) issued under Sections 73(1)/74(1) of the KSGST Act, 2017, as read with Section 20 of the IGST Act, 2017.
It has been observed that there is a need for clarity regarding the computation and imposition of penalties under the fourth proviso of Section 20 of the Integrated Goods and Services Tax (IGST) Act, 2017, particularly in cases where tax demands are raised under Section 73(1)/74(1) of the Kerala Goods and Services Tax (KSGST) Act, 2017.
To ensure uniformity in the application of the law across various field formations, the department has exercised the powers conferred by Section 168 (1) of the Kerala State Goods and Services Tax Act, 2017 (KSGST Act) and issued the following clarifications:
- Section 73 of the KSGST Act, 2017: Addresses tax determination in cases of non-payment, short payment, erroneous refunds, or wrongful input tax credit utilization, excluding fraud or willful misstatements.
- Section 74 of the KSGST Act, 2017: Deals with tax determination in cases involving fraud, willful misstatement, or suppression of facts.
As per Section 20(xxv) of the IGST Act, 2017, the provisions of the Central Goods and Services Tax Act related to penalties, interest, and miscellaneous provisions also apply to the IGST Act.
The key takeaway is that the penalty under the IGST Act is a sum of penalties levied under the CGST and SGST Acts, with no independent provisions under the IGST Act itself.