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Under the Press Information Bureau’s GST litigation FAQ, a show-cause notice (SCN) threshold is met when the relevant tax and applicable cess total ₹10,000 or more. Combine the relevant amounts across CGST, SGST/UTGST, IGST and cess; do not add interest, late fee or penalty to reach the floor. The same FAQ says calling the prescribed voluntary-payment amount a “charge” rather than a “penalty” does not reduce what is payable.
How the ₹10,000 minimum SCN threshold works
The PIB FAQ, posted 9 October 2026, addresses the minimum threshold under sections 73, 74 and 74A of the Central Goods and Services Tax Act, 2017. It states that the relevant amount of tax, including applicable cess, must be ₹10,000 or more for the threshold to be met. Exactly ₹10,000 qualifies; the rule is not limited to amounts above ₹10,000. Read the PIB FAQ.
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Combine the relevant tax heads
Use the aggregate amount of tax involved under CGST, SGST/UTGST, IGST and applicable cess. No single tax head has to reach ₹10,000 on its own. For example, relevant tax amounts of ₹4,000 under CGST and ₹6,000 under SGST/UTGST total ₹10,000 and meet the stated minimum, even though neither head individually reaches it.
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The threshold is measured against tax and applicable cess, not a combined demand figure that includes interest, late fee or penalty. Those additional amounts cannot bring a tax amount below ₹10,000 up to the threshold.
Wrongly availed or utilised ITC
Tax connected with input tax credit that was wrongly availed or utilised is included in the threshold calculation. If the matter involves multiple tax heads, aggregate the relevant tax amounts across those heads as described above.
What “charge” means for voluntary payment
The PIB FAQ says substituting “charge” for “penalty” does not alter the quantum payable. Under the qualifying voluntary-payment route described in the FAQ, a taxpayer seeking conclusion of proceedings still pays the tax, applicable interest and prescribed reduced penalty within the relevant timeline. The amount previously described as a penalty is termed a charge under the amended provision; the new label does not make it optional or replace the tax and interest due.
Payment head
The FAQ directs that the amount payable as “charge” be deposited under the payment head “Others”, in accordance with the prescribed payment mechanism. The FAQ’s charge answers explain both the terminology and the payment head.
Other measures in the GST Council’s litigation package
The Press Information Bureau’s account of GST Council reforms describes a broader package of recommendations. It is useful context, but a Council recommendation is not by itself proof that a measure has commenced or applies to a particular notice, appeal or payment. The release describes the following items as recommendations: PIB release on the GST Council reforms.
| Measure described | Details in the PIB account |
|---|---|
| Reduced penalty in specified non-fraud cases | 5% where tax and interest are paid within 30 days under section 73 or 60 days under section 74A of the adjudication order. |
| Minimum penalty in non-fraud cases | Removal of the minimum penalty. |
| General penalty ceiling under section 125 | Proposed reduction from ₹25,000 to ₹10,000. |
| Appeal pre-deposit for specified penalty-only cases | Proposed cap of ₹40 crore, split as ₹20 crore under CGST and ₹20 crore under SGST/UTGST. |
These figures and timelines describe the Council’s recommendations as reported by the PIB; they should not be treated as operative terms for an individual case without checking the relevant enacted amendment and commencement instrument.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What to verify before acting on a notice or making a payment
The FAQ clarifies its threshold calculation and the meaning and payment head of “charge,” but those answers alone do not settle every effective-date or pending-case question. Before relying on a reform for a particular matter, check:
- The current text of the CGST Act and the amendment provision relevant to the issue.
- The Gazette notification that brings that amendment into force.
- Any applicable rules, circulars and transitional provisions for pending notices or appeals.
- The notice’s relevant tax and cess amounts by tax head, separately from interest, late fee and penalty.
- The applicable section and deadline if considering a voluntary-payment option.
The GST Council’s official meeting material provides additional context on the reforms: GST Council meeting material. For an individual demand, deadline or appeal, confirm the current law and applicable commencement and transitional rules with a qualified tax professional.
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