Provisions under Rule 162 of the Central Goods and Services Tax (CGST) Rules, 2017 relating to “Procedure for Compounding of Offences”, are as under:
CGST Rule 162: Procedure for Compounding of Offences (Chapter-XIX: OFFENCES AND PENALTIES)
(1)An applicant may, either before or after the institution of prosecution, make an application under sub-section (1) of section 138 in FORM GST CPD-01 to the Commissioner for compounding of an offence.
(2) On receipt of the application, the Commissioner shall call for a report from the concerned officer with reference to the particulars furnished in the application, or any other information, which may be considered relevant for the examination of such application.
(3) The Commissioner, after taking into account the contents of the said application, may, by order in FORM GST CPD-02, on being satisfied that the applicant has co-operated in the proceedings before him and has made full and true disclosure of facts relating to the case, allow the application indicating the compounding amount and grant him immunity from prosecution or reject such application within ninety days of the receipt of the application.
(4) The application shall not be decided under sub-rule (3) without affording an opportunity of being heard to the applicant and recording the grounds of such rejection.
(5) The application shall not be allowed unless the tax, interest and penalty liable to be paid have been paid in the case for which the application has been made.
(6) The applicant shall, within a period of thirty days from the date of the receipt of the order under sub-rule (3), pay the compounding amount as ordered by the Commissioner and shall furnish the proof of such payment to him.
(7) In case the applicant fails to pay the compounding amount within the time specified in sub-rule (6), the order made under sub-rule (3) shall be vitiated and be void.
(8) Immunity granted to a person under sub-rule (3) may, at any time, be withdrawn by the Commissioner, if he is satisfied that such person had, in the course of the compounding proceedings, concealed any material particulars or had given false evidence. Thereupon such person may be tried for the offence with respect to which immunity was granted or for any other offence that appears to have been committed by him in connection with the compounding proceedings and the provisions the Act shall apply as if no such immunity had been granted.
It may be noted that the above information is based on Updated CGST Rules 2017 (amended upto 5th May 2020), as compiled/ shared by CBIC (i.e. as notified/ amended upto 5th May 2020 by the CBIC). However, for detailed/ official information and/ or subsequent updates, please refer relevant Notifications. E&OE
Further, it may be noted that Rules 139 to 162 (pertaining to various Chapters) of the Central Goods and Services Tax (CGST) Rules, 2017 were initially notified by CBIC vide CGST (3rd Amendment) Rules, 2017 Notification No. 15/2017 Central Tax dt. 1 July 2017, applicable w.e.f. 1 July 2017.
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