57th GST Council Recommends Removal of Arrest Provisions and Raising Prosecution Threshold from ₹1 Crore to ₹5 Crore

The 57th Meeting of the GST Council was held on October 08, 2026, in New Delhi, under the chairpersonship of the Union Finance & Corporate Affairs Minister, Smt. Nirmala Sitharaman. At the meeting, the GST Council made recommendations relating to process reforms, primarily covering registration, returns, refunds and adjudication; clarifications regarding the applicability of GST on supplies of certain goods and services; and other measures for trade facilitation and streamlining GST compliances.

Rationalization of provisions relating to arrest and prosecution: The Council has recommended complete withdrawal of arrest powers under GST by omission of section 69 of CGST Act, 2017.

With a view to further strengthening a progressive and trust-based tax regime, while retaining effective deterrence against fraud and evasion, the Council recommended the following measures:

• The monetary threshold for prosecution to be raised from ₹1 crore to ₹5 crore.
• Omission of clause (i) of section 132(1) of the CGST Act, 2017, deletion of the words “evades tax” in clause (e) of section 132(1) and deletion of words “or in any other manner deals with” in clause (h) of section 132(1) of the CGST Act, 2017.
• Amendment in clause (c) of section 132(1) of the CGST Act, 2017, to cover only offence of fraudulent availment of ITC without receipt of goods or services or without invoice or bill.
• Rationalizing the amount of punishment for various offences under section 132 of the CGST Act, 2017.

The Press Release can be accessed at:  https://www.pib.gov.in/PressReleaseDetail.aspx?PRID=2320934&reg=48&lang=1