Text
The text below is the section as served by the CBIC tax information portal on 17 September 2026, with the portal's own amendment footnote markers (shown as small numerals before a bracket) and its footnotes.[1] The Act as published in the Gazette of India is the legal source.
Section 74A, verbatim (show)
Section 74A
1[Section 74A. Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason pertaining to Financial Year 2024-25 onward.-
(1) Where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or utilised input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under section 50 and a penalty leviable under the provisions of this Act or the rules made thereunder:
Provided that no notice shall be issued, if the tax which has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised in a financial year is less than one thousand rupees.
(2) The proper officer shall issue the notice under sub-section (1) within forty-two months from the due date for furnishing of annual return for the financial year to which the tax not paid or short paid or input tax credit wrongly availed or utilised relates to or within forty-two months from the date of erroneous refund.
(3) Where a notice has been issued for any period under sub-section (1), the proper officer may serve a statement, containing the details of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for such periods other than those covered under sub-section (1), on the person chargeable with tax.
(4) The service of such statement shall be deemed to be service of notice on such person under sub-section (1), subject to the condition that the grounds relied upon for such tax periods other than those covered under sub-section (1) are the same as are mentioned in the earlier notice.
(5) The penalty in case where any tax which has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised,––
(i) for any reason, other than the reason of fraud or any wilful-misstatement or suppression of facts to evade tax, shall be equivalent to ten per cent. of tax due from such person or ten thousand rupees, whichever is higher;
(ii) for the reason of fraud or any wilful-misstatement or suppression of facts to evade tax shall be equivalent to the tax due from such person.
(6) The proper officer shall, after considering the representation, if any, made by the person chargeable with tax, determine the amount of tax, interest and penalty due from such person and issue an order.
(7) The proper officer shall issue the order under sub-section (6) within twelve months from the date of issuance of notice specified in sub-section (2):
Provided that where the proper officer is not able to issue the order within the specified period, the Commissioner, or an officer authorised by the Commissioner senior in rank to the proper officer but not below the rank of Joint Commissioner of Central Tax, may, having regard to the reasons for delay in issuance of the order under sub-section (6), to be recorded in writing, before the expiry of the specified period, extend the said period further by a maximum of six months.
(8) The person chargeable with tax where any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised for any reason, other than the reason of fraud or any wilful-misstatement or suppression of facts to evade tax, may,––
(i) before service of notice under sub-section (1), pay the amount of tax along with interest payable under section 50 of such tax on the basis of his own ascertainment of such tax or the tax as ascertained by the proper officer and inform the proper officer in writing of such payment, and the proper officer, on receipt of such information shall not serve any notice under sub-section (1) or the statement under sub-section (3), as the case may be, in respect of the tax so paid or any penalty payable under the provisions of this Act or the rules made thereunder;
(ii) pay the said tax along with interest payable under section 50 within sixty days of issue of show cause notice, and on doing so, no penalty shall be payable and all proceedings in respect of the said notice shall be deemed to be concluded.
(9) The person chargeable with tax, where any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised by reason of fraud, or any wilful-misstatement or suppression of facts to evade tax, may,––
(i) before service of notice under sub-section (1), pay the amount of tax along with interest payable under section 50 and a penalty equivalent to fifteen per cent. of such tax on the basis of his own ascertainment of such tax or the tax as ascertained by the proper officer and inform the proper officer in writing of such payment, and the proper officer, on receipt of such information, shall not serve any notice under sub-section (1), in respect of the tax so paid or any penalty payable under the provisions of this Act or the rules made thereunder;
(ii) pay the said tax along with interest payable under section 50 and a penalty equivalent to twenty-five per cent. of such tax within sixty days of issue of the notice, and on doing so, all proceedings in respect of the said notice shall be deemed to be concluded;
(iii) pay the tax along with interest payable thereon under section 50 and a penalty equivalent to fifty per cent. of such tax within sixty days of communication of the order, and on doing so, all proceedings in respect of the said notice shall be deemed to be
concluded.
(10) Where the proper officer is of the opinion that the amount paid under clause (i) of sub-section (8) or clause (i) of sub-section (9) falls short of the amount actually payable, he shall proceed to issue the notice as provided for in sub-section (1) in respect of such amount which falls short of the amount actually payable.
(11) Notwithstanding anything contained in clause (i) or clause (ii) of sub-section (8), penalty under clause (i) of sub-section (5) shall be payable where any amount of self-assessed tax or any amount collected as tax has not been paid within a period of thirty days from the due date of payment of such tax.
(12) The provisions of this section shall be applicable for determination of tax pertaining to the Financial Year 2024-25 onwards.
Explanation 1.––For the purposes of this section,––
(i) the expression “all proceedings in respect of the said notice” shall not include proceedings under section 132;
(ii) where the notice under the same proceedings is issued to the main person liable to pay tax and some other persons, and such proceedings against the main person have been concluded under this section, the proceedings against all the persons liable to pay penalty under sections 122 and 125 are deemed to be concluded.
Explanation 2.––For the purposes of this Act, the expression “suppression” shall mean non-declaration of facts or information which a taxable person is required to declare in the return, statement, report or any other document furnished under this Act or the rules made thereunder, or failure to furnish any information on being asked for, in writing, by the proper officer.]
1. Inserted by section 138 of The Finance Act (No. 2) Act, 2024 No. 15 of 2024 dated 16.08.2024.
74A(1) and provisoNotice and minimum
no notice shall be issued, if the taxSection 74A(1) and proviso
The officer notices the stated tax, refund and credit defaults with section 50 interest and penalty, but the financial-year amount below one thousand rupees is excluded. The law does not settle the tax-head or default aggregation for that minimum. Section 62 overrides section 74A for its assessment route.
Questions to answer on the fileThe ground and the notice6 questions
Questions to answer on the fileThe bar where the amount for the financial year is less than one thousand rupees2 questions
74A(2)Notice period
within forty-two months from the due date for furnishing of annual returnSection 74A(2)
Erroneous refunds instead use forty-two months from refund. Section 75 supplies the quoted limitation exclusions. The law does not settle the starting date where no annual return is required.
Questions to answer on the file4 questions
74A(3) and (4)Other-period statements
The service of such statement shall be deemed to be service of noticeSection 74A(3) and (4)
A prior notice must exist. Other-period grounds must match that notice to receive the deemed treatment.
Questions to answer on the file3 questions
74A(5)(i) and (ii)Penalty categories
shall be equivalent to ten per cent. of tax due from such person or ten thousand rupees, whichever is higherSection 74A(5)(i) and (ii)
That measure applies to non-fraud reasons; fraud, wilful misstatement or suppression to evade tax carries penalty equal to tax. The law does not settle whether "tax due" means the notice proposal or the determined amount. Section 75 prevents the stated duplicate penalty for the same act or omission.
Questions to answer on the file4 questions
74A(6)Determination
determine the amount of tax, interest and penalty due from such person and issue an order.Section 74A(6)
The officer considers any representation first. The order period follows sub-section (7).
Questions to answer on the file4 questions
74A(7) and provisoOrder and extension
within twelve months from the date of issuance of notice specified in sub-section (2)Section 74A(7) and proviso
The Commissioner or authorised senior officer, not below Joint Commissioner rank, may extend by up to six months before expiry for written delay reasons. Section 75 qualifies computation through its stated exclusions.
Questions to answer on the file6 questions
74A(8)(i) and (ii)Non-fraud payment routes
within sixty days of issue of show cause notice, and on doing so, no penalty shall be payableSection 74A(8)(i) and (ii)
Alternatively, pre-notice tax and interest payment with written intimation prevents notice for the paid amount. The sixty-day route concludes notice proceedings. Sub-section (11) overrides both relief routes for its specified overdue tax.
Questions to answer on the file6 questions
74A(9)(i) to (iii)Fraud payment routes
a penalty equivalent to fifteen per cent. of such taxSection 74A(9)(i) to (iii)
Pre-notice payment requires tax, interest, that penalty and written intimation. Notice-stage closure requires twenty-five per cent. penalty within sixty days; order-stage closure requires fifty per cent. within sixty days of communication, each with tax and interest. Explanation 1 preserves section 132 proceedings.
Questions to answer on the file7 questions
74A(10)Short payment
he shall proceed to issue the notice as provided for in sub-section (1)Section 74A(10)
The officer must consider a sub-section (8)(i) or (9)(i) payment insufficient. Notice covers the shortfall.
Questions to answer on the file3 questions
74A(11)Overriding overdue-tax penalty
Notwithstanding anything contained in clause (i) or clause (ii) of sub-section (8)Section 74A(11)
The non-fraud penalty remains applicable for self-assessed or collected tax unpaid beyond thirty days from its due date. This overrides the specified sub-section (8) relief.
Questions to answer on the file4 questions
74A(12)Period reach
shall be applicable for determination of tax pertaining to the Financial Year 2024-25 onwards.Section 74A(12)
The heading addresses the same period. Footnote 1 supplies no commencement date for the insertion.
Questions to answer on the file2 questions
74A, Explanation 1(i) and (ii)Closure scope
shall not include proceedings under section 132Section 74A, Explanation 1(i) and (ii)
Closure against the main person extends to the specified sections 122 and 125 penalty proceedings against others noticed in the same proceedings. The law does not settle how the main person is identified. Criminal proceedings under section 132 remain outside closure.
74A, Explanation 2Suppression
shall mean non-declaration of facts or information which a taxable person is required to declareSection 74A, Explanation 2
The definition covers required statutory-document disclosures. It also covers failure to provide information requested in writing by the proper officer.
Other questions to answer on the file
Questions a reviewer answers from the engagement file, grouped by the part of the section they come from. They describe what the section asks; they do not decide it.
Scope the section as a whole
Questions to answer on the file2 questions
What the conclusion of proceedings covers Explanation 1
Questions to answer on the file4 questions
The meaning of suppression Explanation 2
Questions to answer on the file3 questions
Frequently asked questions
How long is the ordinary order period?
Twelve months from notice issue. The stated authorised officer may extend it by up to six months before expiry with written reasons.
Section 74A(7)
Do non-fraud and fraud cases use the same penalty?
No. Sub-section (5) sets ten per cent. or ten thousand rupees, whichever is higher, for non-fraud cases and tax-equivalent penalty for fraud-related cases.
Section 74A(5)
Does non-fraud payment relief remove every overdue-tax penalty?
No. Sub-section (11) overrides the specified relief where self-assessed or collected tax remains unpaid beyond thirty days from its due date.
Section 74A(11)
Amendment history
The CBIC text carries 1 footnote. The table gives each in the source's own terms. Effective dates are as the footnotes state them.[1]
| Note | Change | Instrument | Effective from |
|---|---|---|---|
| 1 | Inserted the whole of section 74A. | section 138 of The Finance Act (No. 2) Act, 2024, No. 15 of 2024, dated 16.08.2024[2] | the source's footnote gives no commencement date for the insertion; the date shown is the date of the amending Act |
Relationship with other provisions
| Provision | Connection | Words that tie them |
|---|---|---|
| Section 50 | this provision requires Section 50 | 74A(1) "along with interest payable thereon under section 50" |
| Section 44 | this provision requires Section 44 | 74A(2) "within forty-two months from the due date for furnishing of annual return for the financial year" |
| Section 75 | this provision overridden by Section 75 | s.75(1) "shall be excluded in computing the period specified in... sub-sections (2) and (7) of section 74A"; s.75(13) "no penalty for the same act or omission shall be imposed on the same person under any other provision" |
| Section 75 | 74A(5)(ii) branches on Section 75 | s.75(2) "the penalty under clause (ii) of sub-section (5) of section 74A is not sustainable... the penalty shall be payable by such person, under clause (i) of sub-section (5) of section 74A" |
| Section 132 | Explanation 1(i) exception in Section 132 | Explanation 1(i) "shall not include proceedings under section 132" |
| Section 122, Section 125 | Explanation 1(ii) requires Section 122, Section 125 | Explanation 1(ii) "the proceedings against all the persons liable to pay penalty under sections 122 and 125 are deemed to be concluded" |
| Rule 142 of the CGST Rules, 2017 | this provision prescribed by rule 142 of the CGST Rules 2017 | rule 142(1)(a) "Notice issued under section 52 or section 73 or section 74 10[or section 74A]... a summary thereof electronically in FORM GST DRC-01" |
| Section 3 | the proviso to 74A(7) defined by Section 3 | s.3 lists "(f) Joint Commissioners of Central Tax" above "(g) Deputy Commissioners of Central Tax" |
| Section 62 | this provision overridden by Section 62 | s.62(1) "Notwithstanding anything to the contrary contained in section 73 or section 74 3[or section 74A]" |
Circulars and notifications
Circulars and notifications in the CBIC repository that cite this section, newest first, by number, date and subject. A listing here does not say what an instrument decides; read the instrument.
Circulars (1)
| Number | Date | Subject |
|---|---|---|
| Circular No. 254/11/2025-GST | 27 October 2025 | Assigning proper officer under section 74A, section 75(2) and section 122 of the Central Goods and Services Tax Act, 2017 |
Notifications (1)
| Number | Date | Subject |
|---|---|---|
| Notification No. 20/2024-Central Tax | 8 October 2024 | Seeks to make amendments (Second Amendment 2024) to the CGST Rules, 2017 |
Unsettled questions
The words of section 74a do not answer these questions. Where one decides a matter on the file, the answer depends on the position taken on it.
- From what date does section 74A apply? The source's footnote gives the amending Act, section 138 of the Finance (No. 2) Act, 2024, and its date of 16.08.2024, and no commencement date, and the section carries no "Enforced w.e.f." line.
- From what date does a limitation period run where the person is not required to furnish an annual return for the financial year? Sub-section (2) fixes the starting point only as "the due date for furnishing of annual return", and section 44 exempts some classes of person from furnishing it.
- What is counted in the one thousand rupees of the proviso to sub-section (1)? The proviso tests "the tax... in a financial year" without saying whether the figure is the central tax alone or the tax under all the Goods and Services Tax Acts together, and without saying whether the four defaults it lists are aggregated for the year or each tested on its own.
- What is "tax due from such person" in sub-section (5): the amount proposed in the notice under sub-section (1), or the amount determined in the order under sub-section (6)? The sub-section fixes the whole penalty by reference to it and does not say, and the two figures differ whenever a representation succeeds in part.
- Who is "the main person liable to pay tax" in Explanation 1(ii) where one notice is issued to several persons? The Explanation makes the conclusion of the proceedings against that person conclude the penalty proceedings against everyone else, and neither the Explanation nor the Act says how the main person is identified.
See also
- Section 73 of the CGST Act, 2017: determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any willful-misstatement or suppression of facts
- Section 74 of the CGST Act, 2017: determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any willful-misstatement or suppression of facts
- Section 75 of the CGST Act, 2017: general provisions relating to determination of tax
- Section 62 of the CGST Act, 2017: assessment of non-filers of returns
- Section 50 of the CGST Act, 2017: interest on delayed payment of tax
- Section 132 of the CGST Act, 2017: punishment for certain offences
References
- Central Board of Indirect Taxes and Customs. "Section 74A. Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason pertaining to Financial Year 2024-25 onward". Central Goods and Services Tax Act, 2017, CBIC tax information portal, with amendment footnotes 1 to 1. Retrieved 17 September 2026.
- The Finance Act (No. 2) Act, 2024. Cited in CBIC footnote 1.
External links
- CGST Act, 2017, Section 74A on the CBIC tax information portal