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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Procedural Compliance under GST

Mehta Traders is issued a demand of Rs 3,00,000 (tax, interest and penalty) and recovery proceedings are pending for it. The appellate authority reduces the Government dues to Rs 2,10,000. Under Section 84, what is the amount in relation to which the pending recovery may be continued, and is a fresh notice needed?

Recovery may continue for Rs 2,10,000, the reduced dues, from the stage it had reached. No fresh notice of demand is needed, but the Commissioner must intimate the reduction to the person and the authority handling recovery. The Rs 90,000 is only the reduction.

  1. ARs 3,00,000, with a fresh notice for Rs 2,10,000
  2. BRs 90,000, with no fresh notice
  3. CRs 2,10,000, with no fresh notice of demand but with intimation of the reductionCorrect
  4. DRs 2,10,000, only after serving a fresh notice of demand

Explanation

Reduced dues = 3,00,000 - 90,000 = 2,10,000. Under Section 84(b), recovery continues in relation to the reduced amount from the stage already reached. No fresh notice is needed, but the Commissioner intimates the reduction. Rs 90,000 is only the amount of reduction, which is the wrong base.

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