TMI Blog2020 (1) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... e not in a position to doubt the bona fides of the petitioner Company, that due to the initial stage of the CGST regime, there might be some confusion, and the cash was wrongly deposited in the wrong electronic cash ledger. There is no provision of cross utilization of the fund as in case of 'electronic credit ledger'. Benefit of the provisions of Section 77 (1) of the CGST Act, read with Section 19(2) of the IGST Act - HELD THAT:- The contention of the learned counsel for the CGST that these provisions are for the persons acting bona fide, may also be accepted, but there is nothing on the record of this case to show that the petitioner Company had not acted bona fidely, particularly in view of the fact that the transaction relates to the early stages in which the GST regime had been implemented, and there might be some confusion prevailing at that initial stage - In that view of the matter, we do not find any plausible reason whatsoever, to deny the petitioner Company the benefit of the provisions of Section 77 (1) of the CGST Act, read with Section 19(2) of the IGST Act. The petitioner Company is directed to deposit the amount of ₹ 41,98,642/-, under the IG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere was a deficient liability amounting to ₹ 41,98,642.42/-, whereas in the CGST the excess was shown to the tune of ₹ 41,98,643.71/-, and the tax was also paid accordingly. This remained unnoticed for a period of about one year, and subsequently by letter dated 01.11.2018, as contained in Annexure-3 to the writ application, the petitioner Company was informed that in course of audit by CERA, it was observed after the scrutiny of GSTR-I and GSTR-3B filed by the petitioner, that the petitioner had short paid Integrated tax to the tune of ₹ 41,98,842/- and accordingly, the petitioner was asked to make the payment along with the interest. 4. The said letter was replied by the petitioner Company by letter dated 19.11.2018, as contained in Annexure-4 to the writ application, whereby it was informed that the Company had actually paid the amount of the IGST of ₹ 41,98,643/-, but inadvertently it was paid under the head of CGST, instead of IGST, and as such it was not a case of short payment, rather, it was the case of payment of IGST under a different head. It was also stated in the letter that this mistake had occurred in the early phase of implem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for IGST head as well. 6. Learned counsel for the petitioner has further drawn our attention towards Section 77 of the CGST Act, as also Section 19 of the IGST Act, to show that under Section 77(1) of the CGST Act, if a registered person who has paid the Central tax, as in the case of the petitioner, on a transaction considered by him to be an intra-State supply, but which is subsequently held to be inter-State supply, shall be entitled to the refund of the tax amount so paid, and in the similar manner, it is provided under Section 19(2) of the IGST Act, that the registered person, who has paid Central tax, as in the case of the petitioner, on a transaction considered by him to be a intra-State supply, but which is subsequently held to be an inter-State supply, shall not be liable to pay interest on the amount of the Integrated tax payable. Drawing our attention towaeds these provisions, learned counsel for the petitioner submitted that under Section 77(1) of the CGST Act, the petitioner was fully entitled to get the refund of the CGST paid by him wrongly, and at the same time was not liable to pay any interest, under the provision of Section 19(2) of the IGST Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of CGST, though the tax was paid in the coffer of the Central Government, but the concerned State was denied of its proportion in the tax deposited by the petitioner, and accordingly, the liability of the interest shall be made out. 10. Learned counsel for the CGST has also drawn our attention towards Section 49(3) of the CGST Act, to show that the amount available in the 'electronic cash ledger' may be used for making any payment towards tax or other dues under the provisions of this Act, i.e., only under the CGST head, and there is no such provision as is available for 'electronic credit ledger' under Section 49(4) and (5), for using that ledger for payment of the tax either in the IGST head or CGST head or even in the State head. It is submitted by learned counsel that since in the present case, the payment was made through 'electronic cash ledger' and not through 'electronic credit ledger', there cannot be any adjustment of the tax paid by the petitioner, from CGST to IGST head. 11. Learned counsel for the CGST further submits that Section 77 of the CGST Act, or Section 19 of the IGST Act, shall not be appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and paid to Central Government or State Government .- (1) A registered person who has paid the Central tax and State tax or, as the case may be, the Central tax and the Union territory tax on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall be refunded the amount of taxes so paid in such manner and subject to such conditions as may be prescribed. (2) A registered person who has paid integrated tax on a transaction considered by him to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall not be required to pay any interest on the amount of central tax and State tax or, as the case may be, the Central tax and the Union territory tax payable. Section 19 of the IGST Act reads as follows:- 19. Tax wrongfully collected and paid to Central Government or State Government .- (1) A registered person who has paid integrated tax on a supply considered by him to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall be granted refund of the amount of integrated tax so paid in such ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... electronic cash ledger, as admitted in the letter itself. Had there been otherwise intention on the part of the petitioner, the same cash could have been deposited by the petitioner in the electronic cash ledger used to deposit the tax under the IGST head, but it is the claim of the petitioner that inadvertently due to the fact that it was the initial stages of the GST regime, the cash was deposited in the electronic cash ledger of CGST head. There appears to be substance in the submission of learned counsel for the petitioner, inasmuch as, by deliberately depositing the cash in the electronic cash ledger for the CGST head, at the place of IGST head, possibly no benefit was going to be derived by the petitioner Company. In that view of the matter, we are not in a position to doubt the bona fides of the petitioner Company, that due to the initial stage of the CGST regime, there might be some confusion, and the cash was wrongly deposited in the wrong electronic cash ledger. 15. That being the position, though we find from the plain reading of Section 49 (3) and (4) of the CGST Act, that learned counsel for the CGST may be right in his contention that under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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