TaxTMI 
TaxTMI 
Sec 126 of CGST Act with regard to Penalties
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....ec 126 of CGST Act with regard to Penalties<br> Query (Issue) Started By: - Krishna Murthy Dated:- 1-3-2021 Last Reply Date:- 2-3-2021 Goods and Services Tax - GST<br>Got 5 Replies<br>GST<br>Sir, Sec 126 of CGST Act, General disciplines related to penalty, Sub Sec 6 says that the provision does not apply to a case where penalty is fixed as percentage or fixed amount. But, what could be a case wher....
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....e penalty is not fixed as percentage or fixed amount as penalty is always certain percentage of tax or fixed based on default committed. Reply By Alkesh Jani: The Reply: Shri Can you please elaborate by way of illustration if possible. Reply By KASTURI SETHI: The Reply: By way of sub-section 6 of Section 126 of CGST Act, Govt. has widened the scop of imposing penalty upon the defaulter. Sub-s....
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....ection 6 isolates Section 126 from all other Sections meant for imposing penalties i.e. Section 73, 74, 122 to 125. Reply By Krishna Murthy: The Reply: Sir, thanks for your response. Penalties are normally imposed as a percentage of tax as in the case of Sec 73 and 74 in few instances and as a fixed sum as in the case of Sec 125. When Sec 126(6) overrides these two instances, where could the app....
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....lication of Sec 126 be made. What could be a situation when Sec 126 be applicable. Reply By DR.MARIAPPAN GOVINDARAJAN: The Reply: Section 126 of the Act prescribed the procedure to be followed in imposing penalty. Penalty shall not be imposed straightaway. Even in minor breaches penalty has been imposed. Such things shall not be done. Where penalty is not fixed as percentage, it is at the discre....
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....tion of the Authority to impose penalty considering the facts and circumstances of the case. If there is a fixed rate of penalty then there is no other go except to impose the fixed penalty. Reply By KASTURI SETHI: The Reply: I support the views of Dr.Govindarajan, Sir. Section 126 is a sea and this Section gives vast powers to the department for imposition of penalty which is not covered in oth....
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....er Sections meant for imposition of penalty.<br> Discussion Forum - Knowledge Sharing ....