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GST Arrest Powers Scrapped: What It Means For Businesses

The 57th GST Council has approved the biggest decriminalisation of the tax regime since 2017. The single biggest change: the power of arrest is being removed from the GST law. Until now, Section 69 of the CGST Act let commissioners authorise arrests where specified offences were suspected.

Criminal prosecution will now begin only where the amount involved crosses Rs 5 crore, up from Rs 1 crore. The general penalty is cut from Rs 25,000 to Rs 10,000, and the minimum mandatory punishment is scrapped — courts will now decide fine, jail or both in each case.

For businesses, the practical meaning is this: late filing, genuine errors and delayed payments will attract recovery, interest and a proportionate penalty — but not criminal exposure. One caveat: the Council’s decision needs Parliament to amend the CGST Act before it becomes law.

The package also speeds up refunds and eases registration changes. The message from the Council is consistent: honest mistakes get civil treatment, and criminal law is reserved for big-ticket fraud.

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Khabar 24h Editorial Desk

Khabar 24h Editorial Desk — our explainers are prepared by the Khabar 24h editorial team using AI-assisted research tools, and every piece is reviewed by a human editor before publishing. We do not claim original reporting: our work is turning complex topics into simple, accurate summaries. Spotted an error? Write to contact@khabar24h.com — our corrections policy aims for same-day review.

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