Applicable tax under Sec 129

[Krishna Murthy]

Sir, Section 129(1)(a) of CGST Act provides for release of goods detained in transit on payment of applicable tax and penalty. What is the rate of tax here in case of Compostion dealer. Whether it is the rate of tax of that particular goods (ie 5% or 12% or 18% or 28%) or since being a composition dealer applicable rate of tax is 1% ?

AI Summary

Tax Rate for Goods Detained in Transit: Composition Dealers Pay 1% Under Section 129(1)(a) CGST Act A query was raised regarding the applicable tax rate under Section 129(1)(a) of the CGST Act for goods detained in transit involving a composition dealer. The question was whether the tax rate should be the standard rate for the goods (5%, 12%, 18%, or 28%) or the 1% rate applicable to composition dealers. Respondents agreed that the applicable tax rate for a composition dealer is 1%. It was noted that the officer detaining the goods cannot assess the tax rate, and actions under Rule 6(4) of the CGST Rules, 2017, may also be applicable.