PUNISHMENT UNDER SECTION 132

[Sadanand Bulbule]

Punishment for certain offences.

Section 132. (1) Whoever commits, or causes to commit and retain the benefits arising out of, any of the following offences, namely:-

(a) supplies any goods or services or both without issue of any invoice, in violation of the provisions of this Act or the rules made thereunder, with the intention to evade tax;

(b) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act, or the rules made thereunder leading to wrongful availment or utilisation of input tax credit or refund of tax;

(c) avails input tax credit using the invoice or bill referred to in clause (b) or fraudulently avails input tax credit without any invoice or bill;

(d) xxxx

Query:

The word " benefits" is not defined under the GST Act. So does the word" benefits" used in the opening line of Section 132 mean the benefit of ITC or pecuniary benefit or any one of these two? This is crucial because, the person who "retains the benefits" arising out of listed offences is alone liable for punishment of imprisonment or fine or both subject to other conditions and threshold limit prescribed under Section 132 of the GST Act, if charges are proved in the court of law.

Experts to clarify.

Greetings to all the visitors on the eve of Makar Sankranthi festival.

AI Summary

Retention of benefit may include wrongful ITC or pecuniary gain, triggering criminal liability under Section 132 when proved.
Prosecution under Section 132 applies only where a listed offence is committed or caused and the offender retains the benefits arising therefrom. "Benefits" is not defined but is to be read broadly as any advantage - notably wrongful availment of input tax credit or other pecuniary gains received for issuing invoices without supplies. Adjudication under the tax provisions (Sections 73/74) and the de-duplication rules in Section 75(13) and the Explanation to Section 74 ordinarily govern recovery; criminal punishment follows only after proof of commission and retention, subject to compounding where applicable.