Those who are eligible for GST but fail to fulfill their tax obligations may be subject to penalty charges. The amount of penalty charged depends on whether the failure to pay taxes is intentional or unintentional. If the failure to pay taxes was unintentional, the individual or business will be required to pay a penalty of 10% of the total tax amount, provided that the tax liability exceeds Rs. 1 Lakh. This penalty is imposed to encourage timely payment of taxes and to discourage non-compliance.
However, if the failure to pay taxes was deliberate, the responsible party will be required to pay the entire outstanding amount as a penalty. This is a more severe penalty and is imposed to deter fraudulent activities and tax evasion. To avoid penalty charges and maintain compliance with GST regulations, individuals and businesses are required to fulfill their tax obligations.
