Find
Under Sec 74 (periods up to FY 2023-24), paying tax, interest and a penalty of 15 percent of tax before the notice closes the matter under Sec 74(5).
GST
DRC-01A under Sec 74 alleging fraud
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Provisions
Sec 74(1), CGST Act 2017; Sec 74(5), CGST Act 2017
Analysis
On tax of ₹5 lakh, paying now means ₹5 lakh plus interest plus ₹75,000 penalty. After the notice the penalty rises. But if there was no fraud, you can argue the case belongs under Sec 73, where pre-notice payment carries no penalty and the time limit is shorter. Decide based on facts and evidence.
Close
- Check what facts the officer uses to allege fraud.
- Compute the cost of paying now with 15 percent penalty.
- If no fraud, reply arguing Sec 73 applies.
- Pay through DRC-03 only after deciding.
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