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CA Final · Indirect Tax Laws · Offences and Penalties and Ethical Aspects under GST

Kapoor Ltd applied for compounding, and the Commissioner granted immunity after Kapoor paid the tax, interest, penalty and the compounding amount. Later the Commissioner finds that Kapoor gave false evidence during the compounding proceedings. What can the Commissioner do under rule 162?

The Commissioner can withdraw the immunity at any time on finding that material particulars were concealed or false evidence was given in the compounding proceedings. The person may then be tried for the offence as if no immunity had ever been granted.

  1. ANothing, because the order is final once compounding is paid
  2. BWithdraw the immunity, after which Kapoor may be tried for the offence as if no immunity had been grantedCorrect
  3. COnly recover the compounding amount again
  4. DOnly impose a penalty equal to the compounding amount

Explanation

Rule 162(8) permits withdrawal of immunity at any time if the person concealed material particulars or gave false evidence in the compounding proceedings. The person may then be tried for the offence, and the Act applies as if no immunity had been granted. The order is therefore not final in such a case.

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