Clarification regarding the treatment of GST dues for corporate debtors


The Central Board of Indirect Taxes Customs (CBIC) on December 27, 2022, issued a notification regarding Clarification regarding the treatment of statutory dues under GST law in respect of the taxpayers for whom the proceedings have been finalized under Insolvency and Bankruptcy Code, 2016.

The word ‘other proceedings’ is not defined in CGST Act. It is clarified that the adjudicating authorities and appellate authorities under IBC are quasi-judicial authorities constituted to deal with civil disputes pertaining to insolvency and bankruptcy.

As per Section 84 of the CGST Act, if the government dues against any person under CGST Act are reduced as a result of any appeal, revision, or other proceedings in respect of such government dues, then an intimation for such reduction of government dues has to be given by the Commissioner to such person and to the appropriate authority with whom the recovery proceedings are pending.

This shall be applicable to orders of adjudicating authorities and appellate authorities under IBC as well.

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