₹25,000 GST Demand meets ₹1.36 Crore Penalty for Generating ‘Nil’ Value

In a recent decision, the Madras High Court overturned a GST order imposing a ₹25,000 demand and ₹1.36 crore penalty on a company for generating a nil-value e-way bill. The court found that the penalty was excessive and not justified by the circumstances. The company had issued e-way bills for goods without actual delivery, which led to the GST demand. However, the court emphasized that penalties should be proportionate to the offense and should not be used to impose undue financial burden. The decision highlights the importance of ensuring fair enforcement of GST regulations and avoiding disproportionate penalties.