Answer

1. F

   Facts

   For periods up to FY 2023-24 under Sec 74, paying before the notice needs tax, interest and penalty of 15 percent of tax. For FY 2024-25 onwards under Sec 74A, the fraud case penalty before notice is also 15 percent.

2. P

   Provisions and law

   • Sec 74(5), CGST Act 2017In fraud cases up to FY 2023-24, paying before notice needs tax, interest and 15 percent penalty
   • Sec 74A, CGST Act 2017For FY 2024-25 onwards: paying before notice means no penalty in non-fraud cases and 15 percent penalty in fraud cases
3. A

   Analysis

   On ₹4 lakh tax, paying now costs ₹60,000 penalty against up to ₹4 lakh later. Paying accepts the fraud allegation, so only do it if the facts support it. If you dispute fraud, argue it is a Sec 73 case.

4. C

   Conclusion

   1. 1Check whether fraud is really alleged and supported.
   2. 2If accepting, pay tax, interest and 15 percent penalty.
   3. 3If disputing, explain in Part B.
   4. 4Keep the payment and reply records.

General guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.