S.No

Particulars

Required Compliances

Consequences for

non-compliances

1

GST Supplier payment outstanding more than 180 days.

Payment to be Settled to all GST suppliers whose invoice outstanding more than 180 days from the date of Invoice.

ITC on such supply should be reversed along with interest @ 18% p.a and the same can be claimed again only on payment to the supplier.

2

Sale of Vehicles or Other Asset

GST needs to be paid at applicable rate on the profit of sale of vehicles / Asset.

In addition to the GST Interest at the 18% p.a needs to be paid from the due date of payment to actual date of payment.

3

Reversal of Input Tax credit – Rule 42 & 43 of CGST rules.

ITC needs to be reversed on or before the end of financial year for the common ITC used for taxable and exempted supplies to extent used for exempted supplies.

Interest at the 18% needs to be paid from the 1^st day after financial year to the actual reversal date.

4

Reversal of ITC on Ineligible Fixed Assets

(Eg- ITC on Building and related work contract Exp, False ceiling, Vehicles (except few)

ITC should not be claimed on ineligible Fixed assets. If any ITC claimed then the same should be reversed.

Otherwise, Pay the ineligible ITC with interest at the rate of 18% Pa.

5

Reversal of Ineligible ITC

(Eg- ITC on Food & Beverage, Staff related Exp, Rent-a-Cab, Life, Health & Vehicle Insurance, goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples, personal user, CSR expenditure

ITC should not be claimed on ineligible Fixed assets. If any ITC claimed then the same should be reversed.

Otherwise, Pay the ineligible ITC with interest at the rate of 18% Pa.

6

Maintenance of Stock Ledgers/ Register

All stock statements at the end of period should match with physical stock by doing physical verification at regular intervals.

There is a possibility that in case of GST Inspection or audit the department may raise demand for the difference in stock.

7

Properly disclose the missed-out Sales Invoice in upcoming GSTR-1 before end of this financial year 

(Eg-Export Sales/SEZ Sales/ Rental Income/Other Income charges Collected)

Ensure Sales figure match between Books of Accounts, GSTR-1 and GSTR-3B and make sure no Reconciliation Item in GSTR 9/9C filing. 

Mismatch between GSTR-1 /GSTR-3B / GSTR-9 will have change to select your case for Audit / Inspection under GST

8

Properly disclose the missed-out Sales Return (Credit Note) in upcoming GSTR-1 before end of this financial year 

Ensure Sales Return figure match between Books of Accounts, GSTR-1 and GSTR-3B and make sure no Reconciliation Item in GSTR 9/9C filing. 

Mismatch between GSTR-1 /GSTR-3B / GSTR-9 will have change to select your case for Audit / Inspection under GST

9

Taxability of corporate guarantee provided for related persons (sub-rule (2) of Rule 28) 

For inter corporate guarantee provided without consideration between Group company, as recommended to charges at least 1% of guarantee value and collect and pay 18% GST on the guarantee amount. This GST is eligible to take as Input Tax credit.

If not collected and pay the GST for corporate guarantee, in the time of audit department may charge the GST for the same, with interest and penalty, in that time you are not allowed to take an input tax credit.

10

Matching of ITC & Cash Ledger with Books of Accounts

Take care that your GSTR filed return and your books of accounts and match with each other.

If not matching, you may incur a penalty for non-maintenance of books of accounts. 

S.No

Particulars

Required Compliances

Consequences of non-compliances

1

Edit Log Implementation

Every company needs to maintain accounting software that should has tracking of audit trail (Edit Log).

Penalty of minimum of Rs.50,000 and maximum of Rs.5,00,000 will be imposed.

2

CSR

Companies for which CSR provisions applicable needs to spend 2% of average 3 net profit of three immediately preceding Financial year.

If CSR not spent with in the FY then if

1. Ongoing project - Transfer to CSR account (separate bank a/c) within 30 days from the end of FY and it should be spend within 3 FY from the date of transfer  sec 135(6)
2. Other than ongoing project - Transfer to specified in Schedule      VII within 6 month from the end of FY sec 135(6)

• Penalty of Rs. 1 Crore or twice the amount required to transferred by the company to CSR fund or Unspent CSR account whichever is less will be levied on the company.

• Penalty of Rs.2 lakh or one-tenth of amount required to transferred by the company to CSR fund or Unspent CSR account whichever is less will be levied on the officers of the company

3

Corporate Guarantee or Loan to Other than Pvt Ltd

Companies should take steps while giving loans or guarantee to person other than private ltd companies that it is not in violation of Section 185 of companies act 2023.

Penalty of at least ₹5 lakh, with a maximum of ₹25 lakh, being imposed on the lending company.

Any officer who is in arrears will be punished with either a period of imprisonment that may reach six months or a fine that must not be less than ₹5 lakh but may reach up to ₹25 lakh

4

Charge Creation / Satisfaction

All companies which are required to create / Satisfy the charge needs to be registered with ROC within 30 days from creation / Satisfaction of charge.

The company shall be liable to a penalty of five lakh rupees

Every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees.

5

Complying Accounting Standard

Financial Statement to be prepared based on the applicable Accounting Standard

Default in preparing proper financial statements

Company-Penalty of Rs.3,00,000

Every officer of the company -Penalty of Rs.50,000/-

6

Non-disclosure of MSME

All the MSME and Non-MSME supplier to be Bifurcate and maintained in Books for proper disclosure in the Financial Statements 

Default in preparing proper financial statements

Company-Penalty of Rs.3,00,000

Every officer of the company -Penalty of Rs.50,000/-