Explanation 1 to section 74, Goods and Services Tax - GST

[kapil bokadia]

as per explanation 1(ii) of section 74-

where the notice under the same proceedings is issued to the main person liable to pay tax and some other persons, and such proceedings against the main person have been concluded under section 73 or section 74, the proceedings against all the persons liable to pay penalty under ¹[sections 122 and 125] are deemed to be concluded.

Is there any case law available on such issue?

Posts / Replies

[Sadanand Bulbule]

Refer the following citations:

2024 (6) TMI 667, 2024 ( 3)  TMI 1277

Also refer my article dated 10/02/2022 on " Penalty Under Section 122" published on TMI.

[Sadanand Bulbule]

Normally such situation arises in fraudulent availing and passing on of Input Tax Credit u/s 132(1) (b) & (c) of the Central Goods & Service Tax Act, 2017. Considering the facts and circumstances of each case, the nature of the offence and the material on record, the adjudicating authority has to establish who is the MAIN PERSON. 

In terms of the opening phrase of Section 132, whoever commits, or causes to commit and retain the benefits arising out of any of the offences listed therein has to be established and adjudicated under Section 74.The primary benefit is the benefit of ITC to reduce the output tax payable by the recipient of such fake tax invoices without the receipt of goods/services/both.In my opinion. he is the MAIN PERSON liable for adjudication under Section 74.