Liability of transaction beneficiaries: new penalty makes beneficiaries who instigate arranged transactions responsible for tax evasion consequences.

The amendment inserts a new sub section making any person who retains the benefit of specified transactions and at whose instance such transactions are conducted liable to a penalty equivalent to the tax evaded or the input tax credit availed or passed on, thereby extending penalty exposure to beneficiaries who instigate or profit from tax avoidance arrangements.

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