Compounding of offences permits termination of GST prosecution upon payment of prescribed compounding amount with tax and interest.

The Commissioner may compound any offence under the Act before or after prosecution upon payment by the accused of a prescribed compounding amount to the Central or State Government, provided tax, interest and penalty for the offence have been paid. The statute prescribes minimum and maximum thresholds for the compounding amount. Certain persons and offences are expressly excluded from compounding, and compounding does not affect proceedings under other laws; payment causes no further proceedings under the Act and abates criminal proceedings already initiated.

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