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CS Executive · Tax Laws and Practice · Procedural Compliance under GST

Which of the following is a requirement for imposing a penalty under the general disciplines in section 126 of the CGST Act, 2017?

The person must be given an opportunity of being heard before any penalty is imposed. Section 126(3) prohibits imposing a penalty without a hearing, and the order must also specify the nature of the breach and the applicable law.

  1. AThe penalty must always equal the tax involved in the breach
  2. BThe person must be given an opportunity of being heard before the penalty is imposedCorrect
  3. CThe penalty order need not mention the nature of the breach
  4. DThe penalty must be reduced to zero if the person later pays the tax

Explanation

Section 126(3) states that no penalty shall be imposed on any person without giving him an opportunity of being heard. Section 126(4) requires the order to specify the nature of the breach, and section 126(2) requires the penalty to be commensurate with the breach, so the other options are wrong.

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