Tripura Clarifies GST Rules: No Tax Liability for Fake Invoices, Penalties Applied per Section 122(1)(ii) and Section 74.
The circular issued by the Government of Tripura clarifies the applicability of demand and penalty provisions under the Central Goods and Services Tax Act, 2017, concerning transactions involving fake invoices. It specifies that issuing a tax invoice without an actual supply does not constitute a "supply" under the Act, and thus, no tax liability or recovery is required from the issuer. However, penal action under section 122(1)(ii) is applicable. For recipients fraudulently availing input tax credit (ITC), recovery and penalties under section 74 are applicable. The circular aims to ensure uniformity in implementing these provisions across various jurisdictions.
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