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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Assessment, Audit, Scrutiny, Demand and Recovery, Advance Ruling, Appeals and Revision

Zenith Traders received a notice of demand of Rs 10,00,000 and filed an appeal. The appeal reduced the dues to Rs 6,00,000, and recovery proceedings were already pending. What does section 84 of the CGST Act require?

When dues are reduced in appeal, no fresh demand notice is needed. The Commissioner intimates the reduction to the person and the recovery authority, and recovery continues for the reduced amount from the stage it had reached before the disposal.

  1. AA fresh notice of demand for Rs 6,00,000 must be served before recovery continues
  2. BAll recovery proceedings lapse and must start afresh
  3. CThe Commissioner need not serve a fresh demand but must intimate the reduction to the person and to the authority with whom recovery is pending, and recovery continues for the reduced amount from the earlier stageCorrect
  4. DRecovery continues for Rs 10,00,000 until the appeal is fully disposed of

Explanation

On reduction, section 84(b) says no fresh demand notice is needed, the Commissioner intimates the reduction to the person and the recovery authority, and proceedings continue for the reduced amount from the stage reached. A fresh notice is needed only on enhancement, and then only for the enhanced difference.

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