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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallThe 57th GST Council has recommended a combined ₹10,000 threshold for certain GST show-cause notices, a 5% reduced penalty in specified non-fraud cases, and removal of the minimum ₹10,000 penalty in non-fraud cases. These are recommendations for amendments to the Central Goods and Services Tax Act, 2017—not confirmation that the changes are already in force. The Ministry of Finance’s release reports the recommendations from the Council meeting held in New Delhi on 8 October 2026, chaired by Union Finance and Corporate Affairs Minister Nirmala Sitharaman.
What changes did the GST Council recommend?
The Council recommended amendments to Sections 73, 74 and 74A of the CGST Act affecting notice thresholds, pending matters and penalties. The recommendations, as reported in the Ministry of Finance’s PIB release, are:
- A combined threshold for show-cause notices: No notice would be issued where the tax amount involved is less than ₹10,000, calculated across CGST, SGST, IGST and cess. The release states: “Thus, no notices will be issued if the tax amount involved is less than Rs. 10,000/-.” This is the Council’s recommendation as reported by PIB, not a statement of current law.
- Treatment of qualifying pending matters: Notices and appeals involving less than ₹10,000 that are pending when the threshold provision comes into force would be decided as if the threshold had applied when the notice was issued.
- A 5% reduced penalty in specified non-fraud cases: The recommendation ties the reduced penalty to payment of tax and interest within a time limit after the adjudication order: 30 days under Section 73 or 60 days under Section 74A.
- Removal of the non-fraud minimum penalty: The Council recommended removing the minimum ₹10,000 penalty in non-fraud cases.
- Penalty treated as a charge after timely voluntary payment: The proposed amendments would deem the penalty amount as a “charge” where the full tax, interest and penalty are voluntarily paid within the specified time limit.
How would the proposed ₹10,000 notice threshold work?
The threshold is based on the combined tax amount across four components—CGST, SGST, IGST and cess—not on each component considered separately. Under the recommendation, a notice would not be issued if that combined amount is below ₹10,000. The stated cutoff is “less than” ₹10,000; the release does not say that an amount of exactly ₹10,000 is below the threshold.
The recommendation also addresses qualifying notices and appeals already pending when the threshold provision takes effect. Those matters would be decided as though the threshold had applied on the date the notice was issued. That treatment depends on the proposed provision coming into force; the release does not establish an effective date.
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When would the proposed 5% penalty apply?
The recommendation concerns non-fraud cases and links the reduced penalty to payment of both tax and interest within the applicable period after the adjudication order. The time limit differs by section:
| Section | Case classification | Payment condition | Proposed time limit |
|---|---|---|---|
| 73 | Non-fraud | Pay tax plus interest | Within 30 days of the adjudication order |
| 74A | Non-fraud | Pay tax plus interest | Within 60 days of the adjudication order |
The proposed 5% figure is not presented in the release as a penalty available for every GST demand. The recommendation is specifically framed for non-fraud cases and makes timely payment of tax and interest part of the condition. It does not establish a corresponding reduced penalty for fraud cases.
Are these recommendations already law?
The official release describes Council recommendations for amendments. It does not, by itself, establish that Parliament has enacted them, that an amendment has commenced, or that a particular taxpayer qualifies. Before relying on any of these changes, check the current CGST Act and the relevant official Finance Act, notification, commencement date or circular. A notice or appeal should be assessed under the operative law and its specific facts; the recommendations do not automatically invalidate an existing notice.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Other penalty and appeal recommendations
The Council separately recommended two measures that should not be confused with the proposed amendments to Sections 73, 74 and 74A:
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Scan for outdated or missing drivers - takes under a minuteDriver Scan →Repair Windows errors before they cause bigger problemsFix Now →- Section 125 general penalty: Reduce the maximum general penalty from ₹25,000 to ₹10,000.
- Penalty-only appeal pre-deposit: Set a ₹40 crore upper limit for appeals before the Appellate Authority or Appellate Tribunal where the order involves only a penalty and no tax demand. The recommended split is ₹20 crore under CGST and ₹20 crore under SGST/UTGST.
These, too, are reported as Council recommendations in the PIB release, not verified here as operative amendments.
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