Penalty for same offence on two deemed taxable persons

[SUSHIL BANSAL]

Dear experts,

One taxable person (say X) opened a GST firm. During DGGI search, x  said the firm was opened by Y with his documents, all return filing, banking operations, invoice issuance were done by Y & also admitted that no real transactions done except billing & also admitted that he received certain commission from Y. and during search his business place also not found.

Y in his statements did not agree to the statements of X.

Now in OIO the GST department treated  both X & Y as deemed taxable person

& also said that the firm was opened, operated and controlled by Y.

Imposed penalty u/s 122(1(vii) and 122(1) (ii) for the same amount on both these persons thereby duplicating the amount.

Plz guide whether the action of the GST dept is as per law.

My client is X, whether the facts & statements given by X in search & after that in OIO, the confirmation of the dept also that the firm was opened, operated, controlled by Y will help in getting relief from the penalty to X

AI Summary

GST penalty duplication: identical penalties cannot be imposed on both the document-holder and the operator for the same invoices.
Where operational control, banking, filings and invoice issuance were exercised by one person (Y) and X merely provided documents and received commission, treating both as deemed taxable person and imposing identical penalties duplicates liability; penalty should attach to the actual perpetrator who exercised control and mens rea, not be imposed equally on the document-holder.