📢 Time to Reconsider the Late Fee Structure for GSTR-10

📖 GSTR-10 is the final return required to be filed within three months from the date of cancellation of GST registration or the date of the cancellation order, whichever is later. Its purpose is to facilitate the closure of GST obligations upon cancellation of registration.

⚖️ Under the existing provisions, delay in filing GSTR-10 attracts a late fee of ₹200 per day (₹100 CGST + ₹100 SGST).

🧾 A one-time amnesty was provided vide Notification No. 08/2023–Central Tax dated 31 March 2023, restricting the late fee to ₹1,000 (₹500 CGST + ₹500 SGST) for eligible filings made during the notified period. However, no permanent cap has been prescribed thereafter.

🏢 The absence of a permanent ceiling raises concerns regarding proportionality, especially where businesses have already discontinued operations and exited the GST system.

⏳ Since GSTR-10 is a one-time compliance requirement, delays may often result from oversight rather than intentional non-compliance.

💡 It may be worthwhile for policymakers to consider introducing a reasonable permanent cap on late fees, ensuring that the levy remains fair, proportionate, and aligned with the nature of this final compliance obligation.

🤝 A balanced approach can encourage compliance while preventing undue hardship for taxpayers whose business activities have already come to an end.

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