Section 10 of the CGST Act, 2017 – Composition Scheme –-- The petitioner sought review of the Order dated 11.11.2020, wherein the court dismissed the Writ Petition confirming the Order of the Appellate Authority, who in turn upheld the Order of the respondent. The petitioner sought review on the grounds that the imposition of penalty by the authorities is not automatic and the same can be imposed only when there is a fraud or willful intention to defraud the revenue. The petitioner opted for payment of tax under composite scheme under Section 10(1) and started filing GST returns and Form GSTR-IV by paying 1% GST on the turnover. But the 3rd respondent vide SCN dated 14.02.2018 rejected the claim of the petitioner under the composite scheme on the ground that the turnover of the petitioner for the “previous year” under the VAT regime was Rs.2.09 crores. This Court held that the petitioner is not entitled for the benefit under the composite scheme. The petitioner counsel submitted that imposing of penalty under Section 74 is not automatic. The court observed that argument that was advanced at the time of hearing of the Writ Petition was with regard to inclusion of VAT regime for the purpose of deciding the tax to be paid under Section 10(1). In the Review Petition, it is now urged that Section 10 encompasses Section 73 and 74 of the Act as well and in the absence of any fraud, the authorities erred in invoking Section 74 and imposing 100% penalty. Further, the option exercised by the Petitioner was self-declaratory, which requires sometime for the authorities to verify and ultimately found it to be incorrect. They do not find any grounds to interfere with the order impugned in the review.

Held that:- The Hon’ble High Court dismissed the Review application.