How are penalties and fines being added to the GST to prevent tax evasion?

In GST, the government is making strict rules about tax evasion, due to which many traders who do not actually tax evasion are also stuck in these laws, while in fact, they have nothing to do with anything. is. Under GST, all those taxpayers who neither file timely returns nor deposit tax on time and commit tax evasion by exchanging fake bills, therefore, the government is tightening the GST law.

GST Tax Evasion

Offences liable for prosecution

  • Collects any GST (even if in contravention of provisions) but does not submit it to the government within 3 months.
  • Obtains refund of any CGST/SGST by fraud.
  • Submits fake financial records/documents or files fake returns to evade tax
  • Obstructs the proper officer during his duty (for example, he hinders the officer during the audit by tax authorities)
  • Acquires/receives any goods/services with full knowledge that it is in violation of GST rules and is liable for confiscation
  • Destroys any evidence
  • Does not provide information/gives false information during proceedings
  • Helps any person to commit fraud under GST 


Tax amount involvedBailable or Non-BailableJail term
100-200 lakhsBailableUpto 1 year
200-500 lakhsBailableUpto 3 year
Above 500 lakhsBailableUpto 5 year

 What are the offences under GST?

The offenses under GST are the following types of offenses under GST for breaking GST law, evasion of tax and the payment of fake bills.

Tax evasion

1) He will deposit any GST but does not submit it to the government within 3 months, even then he will be a partner of crime.2) He takes and/or utilizes input tax credit without actual receipt of goods and/or services.3) He deliberately suppresses his sales to evade tax.4) He obtains a refund of any CGST/SGST by fraud.

Supply/transport of goods

5) He transports goods without proper documents.6) Supplies/transports goods which he knows will be confiscated.


7) If he files fake financial records/documents or fake returns for tax avoidance then it is also a crime.8) Does not provide information / gives false information during proceedings.

Fake/wrong invoices

9) He issues any invoice or bill without supply of goods/services in violation of the provisions of GST.10) A taxable person supplies any goods/services without any invoice or issues a false invoice.11) He issues invoices using the identification number of another bonafide taxable person.

Other Problems

12) He does not deduct TDS or deducts less amount where applicable.13) He does not maintain all the books that he is required to maintain by law.14) He obstructs the proper officer during his duty (for example, he hinders the officer during the audit by tax authorities).15) He does not collect TCS or collects less amount where applicable.

above, for fraud cases, penalty will be 100% (minimum Rs. 10,000)

What happens if you don’t pay GST?

In order to prevent tax evasion and corruption, various provisions have been implemented to deal effectively with offenders with respect to penalties, prosecution, and arrest. There are certain offenses specified under section – 132 of the CGST Act, 2017 which if committed by any business, person or if any other person approbations him in committing such offenses then he/she/they all shall be liable to such punishment including imprisonment. Under the GST law, the filing of return without payment of taxes shall not be considered as a valid return. Section 2(117) defines a valid return. It means, a return furnished under sub-section (1) of Section 39 on which self-assessed tax has been paid in full. It is only the valid return that would be used for allowing input tax credit (ITC) to the recipient. In other words, unless the supplier has paid the entire self-assessed tax and filed his return and the recipient has filed his return, the ITC of the recipient would not be confirmed.

Can GST penalty be waived?

100/- per day of delay in filing statements u/s 37 or returns u/s 39 of the CGST Act, subject to a maximum amount of Rs. Waive Late Fees for Delayed Filing of GST Returns.
We draw to your kind attention to section 47 of the CGST Act, 2017, which levies a late fee of Rs. 100/- per day of delay in filing statements u/s 37 or returns u/s 39 of the CGST Act, subject to a maximum amount of Rs. 5,000/-. This levy is a common fee on all taxpayers, irrespective of their turnover, which means that registered persons filing Nil Return also have to bear late fees of up to Rs.10,000 (CGST + SGST).

Return TypeRelaxationReturn filing deadline to avail benefit
NIL ReturnFull Waiver of Late FeesFile returns for May – July 2020 latest by 30th September 20

What if GST returns not filed for 6 months?

The GST administration plans to take strict action with the return of non-filers and cancel their registration. filing of returns helps tax authorities to estimate the tax liability and find out how much tax has been paid. The problem here is that nearly 20 percent of assessees do not file their returns, which affects GST collections. Section 29 of the Central Goods & Services Tax (CGST) Act prescribes conditions for cancellation of registration and fulfillment of any of these will invite action. These include contravention of the provisions of the Act, a composition scheme assessee not filing returns for three consecutive tax periods, any non-composition assessee not furnished returns for a continuous period of six months, not commencing business within six months from the voluntary registration, and registration obtained by means of fraud, wilful misstatement or suppression of facts. The Act clearly provides that registration will not be canceled without giving the person an opportunity of being heard.

Can I cancel my GST without filing returns?

In GST, a taxpayer wants to close his GST registration without filing a return, then he cannot close it, till he completes all the liabilities of and if he does not pay late fee. He also cannot file returns. If the taxpayer does not file a 6-month return in the past, the GST officers themselves can close the taxpayer’s firm. If your GST registration has been Suo-Motto canceled by GST Officer, then you have the option to request for cancellation of GST within 30 days from the date of cancellation but the taxpayer can do so only after paying late fees and all liabilities.

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