Penalty under Section 73(1) of CGST Act, 2017

[Alkesh Jani]

Dear All Experts,

Show Cause Notice was issued for recovery of short payment of CGST Rs.1600/- and SGST Rs.1500/- under Section 73 of CGST Act, 2017.

Now the Query is :- what will be the amount of penalty Rs.10,000/- for CGST and SGST or Rs.10,000/- for CGST and Rs.10,000/- for SGST (Total Rs.20,000/-) (Refer Section 73(9) of CGST /SGST Act, 2017).

Please share your valuable insight and any of such quantification.

Thanks in advance.

AI Summary

Section 73 penalty: potential per-tax-head minimum penalties can apply separately, raising concerns of disproportionate double fines.
Whether the statutory minimum monetary penalty for short-paid tax under the general recovery provision attaches separately to central and state tax heads is disputed; the phrase "whichever is higher" has been invoked to support a per-head minimum, producing potential aggregate penalties that exceed the tax shortfall, raising questions about interplay with the fraud penalty framework, prohibition on duplicate penalties for the same act, and proportionality for small taxpayers.