Section 137 of GST Act: Offences by companies

Amended and updated notes on section 137 of CGST Act, 2017. Detail discussion on provisions and rules related to offences by companies.

Amended and updated notes on section 137 of CGST Act, 2017. Detail discussion on provisions and rules related to offences by companies.

Chapter XIX (Sections 122138) of the Central Goods and Services Tax Act, 2017 deals with the provisions related to offences and penalties. Section 137 of CGST 2017 provides for offences by companies.

Recently, we have discussed in detail section 136 (Relevancy of statements under certain circumstances) of CGST Act 2017. Today, we learn the provisions of section 137 of Central GST Act 2017.

Section 137 of the Central Goods and Services Tax Act, 2017 has been notified by the Ministry of Finance vide Notification No. 9/2017-Central Tax, G.S.R. 658(E), dated 28.06.2017. This notification was come into force from 1st July, 2017 i.e. the commencement date of section 137 is 1-7-2017.

Name of ActThe Central Goods and Services Tax Act 2017
Enacted byParliament of India
Administered byCentral Board of Indirect Taxes & Customs
Governing bodyGST Council
Number of Chapters21
Number of Sections174
You are reading:
Chapter No.XIX
Chapter NameOffences and Penalties
Section No.137
Section NameOffences by companies
Updated 2024 EditionGST Law Book PDF

Section 137 of Central GST – Offences by companies1

Section 137 of CGST Act 2017 shall come into force on 01.07.2017 vide Notification No. 9/2017-Central Tax, G.S.R. 658(E), dated 28.06.2017.

Section 137(1) of CGST Act

Section 137(1): Where an offence committed by a person under this Act is a company, every person who, at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

Section 137(2) of CGST Act

Section 137(2): Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any negligence on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Section 137(3) of CGST Act

Section 137(3): Where an offence under this Act has been committed by a taxable person being a partnership firm or a Limited Liability Partnership or a Hindu Undivided Family or a trust, the partner or karta or managing trustee shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly and the provisions of sub-section (2) shall, mutatis mutandis, apply to such persons.

Section 137(4) of CGST Act

Section 137(4): Nothing contained in this section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

Explanation: For the purposes of this section, ––

  • (i) “company” means a body corporate and includes a firm or other association of individuals; and
  • (ii) “director”, in relation to a firm, means a partner in the firm.
  1. Section 137 of CGST Act 2017 shall come into force on 01.07.2017 vide Notification No. 9/2017-Central Tax, G.S.R. 658(E), dated 28.06.2017. ↩︎

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