Section 137 of GST – Offences by companies under GST Act

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Section 137 of GST – Offences by companies under GST Act. Complete Details for GST Section 137 under GST Act 2017. In this GST Section you may find all details for Offences by companies under GST Act 2017Detailed Analysis of GST Section 137 of GST Act 2017. We Provide Complete Details for All GST Section’s and In this article you may find all details for GST Section 137Check Section Wise Analysis of GST Act 2017, Chapter Wise Analysis of GST All Sections. In this article you may find complete details regarding Section 137 of GST Act 2017 – Offences by companies under GST Act, gst all sections and definitionsNow Check more details from below…..

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Section 137 of GST – Offences by companies

Statutory provision

Section 137 of GST

(1) Where an offence committed by a person under this Act is a company, every person who, at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any negligence on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

(3) Where an offence under this Act has been committed by a taxable person being a partnership firm or a Limited Liability Partnership or a Hindu Undivided Family or a trust, the partner or karta or managing trustee shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly and the provisions of sub-section (2) shall, mutatis mutandis, apply to such persons.

(4) Nothing contained in this section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

Explanation.– For the purposes of this section,–

(i) “company” means a body corporate and includes a firm or other association of individuals; and

(ii) “director”, in relation to a firm, means a partner in the firm.

Analysis and Updates

Introduction

This section lowers down heavily on the persons who take shelter on the principle of separate legal status of artificial judicial persons and back out of their responsibility of payment of dues of the Government.

Analysis

This section states that where an offence is committed by companies, every person/director/ manager/secretary or any other officer who at the time of commitment of the offence, was in charge of and was responsible to the company for the conduct of business of the company, as well as the company shall be deemed to be guilty of such offence and shall be liable to proceeded against and punished accordingly.

Where such offences are committed by the person being Partnership Firm, LLP, HUF or trust, then the partner or Karta or Managing Trustee (as the case may be) shall be deemed to be guilty and liable to be proceeded against and punished.

Further, if the accused person proves that he was in no way related to the offence being committed or he had exercised all possible measures to prevent commission of such offences, then he is not punishable under this section.

Comparative Review

These provisions are comparable to section 9AA of the Central Excise Act, 1944 as well as
several State level VAT legislations with few exemptions to persons who can be prosecuted.
The provision as regards LLP, HUF, Trust are new developments.

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