Question 15 - What are the penal consequences if a taxable person violates the condition and is not eligible for payment of tax under the Composition scheme?
FAQ on GST dated 21.9.2016 based on Draft Model GST Chapter 2 Levy of and Exemption from Tax
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Penalty for composition scheme ineligibility: taxpayer must pay tax, interest and a penalty equal to the tax. Breach of Composition Scheme eligibility triggers liability to pay the tax due under the regular regime, interest on that tax, and a penalty equal to the amount of tax payable.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Penalty for composition scheme ineligibility: taxpayer must pay tax, interest and a penalty equal to the tax.
Breach of Composition Scheme eligibility triggers liability to pay the tax due under the regular regime, interest on that tax, and a penalty equal to the amount of tax payable.
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