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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Assessment, Audit, Scrutiny, Demand and Recovery, Advance Ruling, Appeals and Revision

In an appeal, the Government dues covered by a demand notice are enhanced from ₹8 lakh to ₹11 lakh. Under the CGST provision on continuation of recovery proceedings, which statement is correct?

The Commissioner serves another demand notice only for the enhanced portion, which is ₹3 lakh. Recovery of the original ₹8 lakh can continue from its existing stage without a fresh notice, as section 84 provides for enhancement in appeal or revision.

  1. AThe Commissioner serves another notice of demand for the additional ₹3 lakh, and recovery of the earlier ₹8 lakh may continue from its existing stage without a fresh noticeCorrect
  2. BA fresh notice for the entire ₹11 lakh must be served and the earlier recovery stops
  3. CNo further notice is needed for any part of the ₹11 lakh
  4. DThe enhancement is recoverable only after a new adjudication order for ₹11 lakh

Explanation

Section 84(a) requires another notice of demand only for the amount of enhancement, here ₹11 lakh minus ₹8 lakh = ₹3 lakh. Recovery of the amount already covered by the earlier notice continues from the stage reached, without a fresh notice. Serving a fresh notice for the full ₹11 lakh is therefore wrong.

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