THE CENTRAL GOODS AND SERVICES TAX ACT, 2017
OFFENCES AND PENALTIES
Section 126:
General disciplines related to penalty.
(1) No officer under this Act shall impose any penalty for minor
breaches of tax regulations or procedural requirements and in particular, any
omission or mistake in documentation which is easily rectifiable and made
without fraudulent intent or gross negligence.
Explanation.––For the purpose of
this sub-section,––
(a) a breach shall be considered a ‘minor breach’ if the amount of tax involved
is less than five thousand rupees;
(b) an omission or mistake in documentation shall be considered to be easily
rectifiable if the same is an error apparent on the face of record.
(2) The penalty imposed under this Act shall depend on the facts and
circumstances of each case and shall be commensurate with the degree and
severity of the breach.
(3) No penalty shall be imposed on any person without giving him an opportunity
of being heard.
(4) The officer under this Act shall while imposing penalty in an order for a
breach of any law, regulation or procedural requirement, specify the nature of
the breach and the applicable law, regulation or procedure under which the
amount of penalty for the breach has been specified.
(5) When a person voluntarily discloses to an officer under this Act the
circumstances of a breach of the tax law, regulation or procedural requirement
prior to the discovery of the breach by the officer under this Act, the proper
officer may consider this fact as a mitigating factor when quantifying a
penalty for that person.
(6) The provisions of this section shall not apply in such cases where the
penalty specified under this Act is either a fixed sum or expressed as a fixed
percentage.