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2023 (10) TMI 336 - MADRAS HIGH COURTAdjustment interest against Refund - Unutilized balance of ITC was not used for payment of GST by the assessee wrongly - Refund of amount that was lying unutilized in the Personal Ledger Account - utilization of Input Tax Credit availed on integrated tax, first towards integrated tax liability and the remaining amount, if any, towards Central Tax or State Tax liability - HELD THAT:- The petitioner could have paid the Central and State GST out of the Input Tax Credit availed on Integrated GST borne by the petitioner. The amount of Rs. 25,77,523/- was wrongly transitioned under Section 140 of the Central GST Act, 2017 and was utilized towards Central and / or State GST. It has been allowed to be re-paid post facto out of Integrated Input Tax Credit which was lying unutilized. Thus, the tax liability stands squared up. The amount of Rs. 25,77,523/- that was wrongly transitioned under Section 140 of the Central GST Act, 2017 and utilized towards tax liability has been also refunded. However, while refunding the amount, a sum of Rs. 9,25,366/- was deducted towards interest. Deduction of Rs. 9,25,366/- towards interest was unnecessary as there was really no loss to the revenue. It would have been different, if tax liability was adjusted earlier out of Input Tax credit availed on State GST borne and was utilized for payment of Central GST by the petitioner under the provisions of the Central Goods and Services Tax Act, 2017. The impugned order dated 31.01.2020 seeking to adjust a sum of Rs. 9,25,366/- towards interest cannot be sustained - the impugned order is liable to be modified - Petition allowed.
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