Explore the distinctions between GST Adjudication under Section 73 and Section 74, including meanings, limitations, penalties, forms, and procedural details. Understand the nuances to ensure effective compliance in the complex GST framework.
Introduction: Adjudication plays a pivotal role in the GST framework, providing a formal decision-making process for tax-related issues. Two crucial sections, 73 and 74, delineate the circumstances, procedures, and consequences associated with demand determination.
Adjudication of Demand under CGST Act,2017
Adjudication means the act of judging a case, competition, or argument, or of making a formal decision about something.
Basic Points of Section 73 & Section 74 of CGST Act, 2017
|
Particular |
Section 73 |
Section 74 |
| Meaning | Reasons other than
|
By Reason of
|
| Limitation for issue of SCN | 3 months prior to time limit of order | 6 months prior to time limit of order |
| Limitation for issue of order | Within 3 years from date of submission of annual return | Within 5 years from date of submission of annual return |
| Penalty before issue of SCN | Nil | 15% |
| Penalty within 30 days after issue of SCN | Nil | 25% |
| Penalty within 30 days of issue of order | 10% of tax or Rs. 10000 (whichever is higher) | 50% |
| Penalty after 30 days of issue of Order | 10% of tax or Rs. 10000 (whichever is higher) | 100% |
Details of GST Forms & to which it is related
|
Forms |
Relating to |
| GST DRC-01A | Intimation of tax ascertained as being payable under section 73(5) or 74(5) |
| GST DRC-01 | Summary of SCN |
| GST DRC-02 | Summary of Statement |
| GST DRC-03 | Intimation of payment made voluntarily or made against DRC-01A, DRC-01 or DRC-02 |
| GST DRC-04 | Acknowledgement of acceptance of payment made voluntarily |
| GST DRC-05 | Intimation of conclusion of proceedings |
| GST DRC-06 | Reply to SCN (GST DRC-01) |
| GST DRC-07 | Summary of Order |
| GST DRC-08 | Summary of Rectification/ Withdrawal Order |
Details of Monetary Limit of the amount of Tax for issuance of Notice
|
Officer of Central Tax |
Monetary limit of the amount of central tax (including cess) for issuance of show cause notices and passing of orders under sections 73 and 74 of CGST Act | Monetary limit of the amount of integrated tax (including cess) for issuance of show cause notices and passing of orders under sections 73 and 74 | Monetary limit of the amount of central tax and integrated tax (including cess) for issuance of show cause notices and passing of orders under sections 73 and 74 of CGST Act made applicable to integrated tax |
|
Superintendent of Central Tax |
Not exceeding Rupees 10 lakhs | Not exceeding Rupees 20 lakhs | Not exceeding Rupees 20 lakhs |
| Deputy or Assistant Commissioner of Central Tax | Above Rupees 10 lakhs and not exceeding Rupees 1 crore | Above Rupees 20 lakhs and not exceeding Rupees 2 crores | Above Rupees 20 lakhs and not exceeding Rupees 2 crores |
| Additional or Joint Commissioner of Central Tax | Above Rupees 1 crore without any limit | Above Rupees 2 crores without any limit | Above Rupees 2 crores without any limit |
Details of Sub Section of Section 73
|
Section |
Particular |
| 73(1) | Circumstances for determination of demand |
| 73(2) | Issuance of notice (time period prior) |
| 73(3) | Issue of statement |
| 73(4) | Statement deemed to be Notice |
| 73(5) | Voluntary Payment Prior to notice |
| 73(6) | No notice to be issued (if 73(5) is done) |
| 73(7) | Notice to be issued for shortfall amount (SCN) |
| 73(8) | No penalty if amount paid within 30 days of issue of SCN |
| 73(9) | Issuance of Order |
| 73(10) | Time limit for order |
| 73(11) | Levy of Penalty |
Details of Sub Section of Section 74
|
Section |
Particular |
| 74(1) | Circumstances for determination of demand |
| 74(2) | Issuance of notice (time period prior) |
| 74(3) | Issue of statement |
| 74(4) | Statement deemed to be Notice |
| 74(5) | Voluntary Payment Prior to notice |
| 74(6) | No notice to be issued (if 74(5) is done) |
| 74(7) | Notice to be issued for shortfall amount (SCN) |
| 74(8) | Consequences of amount paid after SCN |
| 74(9) | Issuance of Order |
| 74(10) | Time limit for order |
| 74(11) | Deemed Conclusion |
Conclusion: Navigating the complexities of GST adjudication requires a comprehensive understanding of Sections 73 and 74. The meticulous analysis reveals the intricacies of demand determination, penalties, and procedural aspects. Stakeholders in the GST domain can use this knowledge to ensure compliance and navigate the adjudication process effectively.
Author Bio
Query regarding monetary limit:
If demand of CGST of Rs. 12,00,000/- and IGST of Rs. 7,00,000/- (total demand of Rs. 19,00,000/-), who will be the proper officer to issue show cause notice ?
Thanks mam