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

Mehta Traders, Surat, has been accused of an offence under section 132(1)(a) of the CGST Act and has applied for compounding. It has never compounded any offence earlier and has not been convicted by a court. Which statement about the compounding application is correct as per the CGST Rules?

The application for compounding is made in FORM GST CPD-01 to the Commissioner, and it may be filed either before or after prosecution has been instituted. FORM GST CPD-02 is the Commissioner's order, and a convicted person cannot compound.

  1. AThe application is made in FORM GST CPD-01 to the Commissioner, either before or after the institution of prosecutionCorrect
  2. BThe application can be made only after the court has convicted the applicant
  3. CThe application is made to the jurisdictional Superintendent in FORM GST CPD-02
  4. DThe application can be made only before prosecution is instituted

Explanation

Rule 162(1) allows an applicant to apply in FORM GST CPD-01 to the Commissioner either before or after prosecution is instituted. Option D is wrong because the timing is not restricted to pre-prosecution. CPD-02 is the Commissioner's order form, not the application form.

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