Reduced Penalty u/s 78 of GST Applies If Tax and Interest Paid Within 30 Days of Demand Order: CESTAT Cuts Penalty to 25%

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has ruled that a reduced penalty under Section 78 of GST applies if tax and interest are paid within 30 days of the demand order, thereby cutting the penalty. This significant decision provides relief to taxpayers, encouraging prompt payment of ascertained tax liabilities. Section 78 deals with penalties for evasion. The ruling means that businesses can benefit from a lower penalty (typically 25% of the tax) if they settle the demand quickly, promoting faster dispute resolution and reducing litigation.