Home Case Index All Cases GST GST + HC GST - 2020 (4) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (4) TMI 664 - HC - GSTDemand of Interest u/s 50 of CGST Act - requirement for issuance of SCN for demand for interest under sub section (1) of Section 50 of Central Goods and Service Tax Act 2017 - violation of principles of natural justice - HELD THAT:- Under sub section (1) of Section 50 of the GST Act, interest can be demanded if an assessee fails to pay the tax or any part thereof within the specified period - On plain reading of sub section (1) of Section 73 of the GST Act, it is applicable when any tax has not been paid or short paid. It contemplates that a show Cause Notice is to be issued to the assessee calling upon him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under Section 50 of the GST Act. Assuming that sub section (1) of Section 73 is not applicable, before penalizing the assessee by making him pay interest, the principles of natural justice ought to be complied with before making a demand for interest under sub section (1) of Section 50 of the GST Act. Consequence of demanding interest and non-payment thereof is very drastic - impugned demand has been set aside only on the ground of the breach of the principles of natural justice by granting liberty to the respondents to initiate action in accordance with law obviously for recovery of interest. Hence before recovery interest payable in accordance with Section 50 of the GST Act, a show Cause Notice is required to be issued to the assessee. Hence, no case for interference is made out - appeal dismissed.
|