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CA Final · Indirect Tax Laws · Appeals and Revision (GST)

Rohan Steels Ltd had a GST demand notice served on it and recovery proceedings began. In the first appeal, the demand was reduced from Rs 12,00,000 to Rs 8,00,000. Under section 84 of the CGST Act, which course is correct?

No fresh notice of demand is needed when dues are reduced in appeal. The Commissioner intimates the reduction to the taxpayer and to the authority handling recovery, and recovery continues for the reduced amount of Rs 8,00,000 from the stage at which it stood before the appeal was disposed of.

  1. AThe Commissioner must serve a fresh notice of demand for Rs 8,00,000 before any recovery continues
  2. BAll recovery proceedings lapse and must be restarted on the reduced amount
  3. CThe Commissioner need not serve a fresh notice, must intimate the reduction to the person and the authority where recovery is pending, and recovery may continue for the reduced amount from the existing stageCorrect
  4. DRecovery may continue for the original Rs 12,00,000 until the appeal period expires

Explanation

Section 84(b) says that where dues are reduced, no fresh notice of demand is needed. The Commissioner gives intimation of the reduction to the person and to the appropriate authority with whom recovery is pending, and recovery may continue for the reduced amount from the stage reached. Option A is wrong because a fresh notice is needed only when dues are enhanced, and then only for the enhanced amount.

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