Penalty u/s 129 CGST/SGST Act can be Imposed Only for Violations With Intent To Evade Tax or Repeated Violations: Kerala HC

The Kerala High Court ruled that penalties under Section 129 of the CGST/SGST Act can only be imposed for violations with the intent to evade tax or in cases of repeated violations. The court clarified that minor discrepancies should be addressed under Sections 122 and 126 of the Acts, which provide for lesser penalties. The ruling came in response to a case where the authorities imposed a penalty for a minor clerical error. The court emphasized that the intent to evade tax must be established before imposing severe penalties under Section 129. This decision aims to prevent the misuse of penalty provisions and ensure that taxpayers are not unduly penalized for minor mistakes. The ruling reinforces the principle of proportionality in tax enforcement, ensuring that penalties are commensurate with the severity of the violation.