GST Returns: No Penalty for Non-Filing Or Delayed Filing of Returns If Late Fees Already Levied

Facts of the Case

• The petitioner, Tvl. Jainsons Castors & Industrial Products challenged an order dated 24.07.2004 issued in Form GST DRC-07 under Section 73 of the TNGST Act, 2017, alleging it was illegal and against principles of natural justice.
• The petitioner contended that it had delayed filing its annual return as per Section 44, but the show cause notice and demand issued under Section 73 was not preceded by a proper notice under Section 46.
• The petitioner did not dispute the late fee under Section 47 but objected to the imposition of a penalty under Section 125 of the Act.

Issues Framed

• Whether imposition of penalty under Section 125 in addition to late fee under Section 47 is legally sustainable.
• Whether initiating proceedings under Section 73 without issuing a notice under Section 46 violates principles of natural justice.

Petitioner’s Arguments

• Section 47 specifically provides for late fees in case of delay in filing returns; Section 125’s general penalty cannot be simultaneously imposed.
• No notice under Section 46 was issued before initiating proceedings under Section 73.
• Return was filed, albeit belatedly, and turnover was not declared.

Respondent’s Arguments

• Proceedings under Section 47 r/w Section 73 were rightly initiated due to the petitioner’s failure to file annual returns under Section 44.
• Penalty and late fee were both levied due to non-furnishing of turnover details.

Court’s Decision & Rationale

• The Court held that Section 47(2) exclusively governs late fees for non-filing or delayed filing of returns and allows a fee of Rs. 100 per day subject to a maximum limit.
• Section 125 is a residuary penalty clause applicable only when no specific penalty is otherwise provided.
• Since a specific penalty (late fee) under Section 47 was imposed, the general penalty under Section 125 was not applicable.

The Court confirmed the levy of a late fee under Section 47 but quashed the penalty imposed under Section 125.

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