TMI Blog2022 (4) TMI 1241X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 63/2020-Central Tax Dated 25.08.2020. The Central Board of Indirect Taxes and Customs has also clarified on 26.8.2020 that no recovery of interest shall be made for the past in the light of the decision taken by the GST Council in its 39th meeting on delayed payment of GST. Since tax was paid by the petitioner belatedly, petitioner is liable to interest during the period default. There was no excuse for not paying the tax in time from its electronic cash register. Nothing precluded the petitioner from discharging the tax liability from its electronic credit - If there is a belated payment of tax declared in the returns filed, interest has to follow. The petitioner has to pay the interest on the belated payment of tax and as has been demanded. Even where there is a failure to file returns or circumstances specified under Sections 73 and 74 of CGST Act, 2017, in interest has to be paid. Petition dismissed. - WP.No.7129 of 2021 And WMP.Nos.7645 & 7647 of 2021 - - - Dated:- 8-4-2022 - Honourable Mr.Justice C.Saravanan For the Petitioner : No Appearance For the Respondents : Mr.R.Gunalan, Junior Standing Counsel ORDER There is no representation on behalf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad Measures for trade Facilitation it was stipulated categorically that interest for delay in payment of GST would be charged only on net cash tax liability with effect from 01.07.2017 and that the proviso to Section 50 would be retrospective, with effect from 01.07.2017. 12. On the heels of the aforesaid recommendation came Notification No.63 of 2020-Central Tax dated 25.08.2020, which stated that the proviso would operate with effect from 01.09.2020. Naturally, this resulted in a barrage of apprehension and doubts from taxpayers. The CBIC reacted promptly and vide press release dated 26.08.2020, issued on the very next day after the aforesaid Notification, clarified that the Notification had been issued only on account of and to get over certain technical limitations and the decision of the GST Council in the 39th meeting would be give full effect. The press release is extracted below: Press Release CBIC 26.08.2020 Interest on delayed payment of GST:CBIC New Delhi: The Central Board of Indirect Tax Customs (CBIC) today clarified that the Notification No. 63/2020 #126;Central Tax dated 25th August 2020 relating to interest on delayed payment of GST has been i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded to be retrospective. Perhaps the relegation of the show cause notices to the call book is to await the passing of the amendments in the central and state statutes. To my mind, the Centre, the State and the CBIC are in agreement that the operation of the proviso of Section 50 should only be retrospective and the interpretation to the contrary by the authorities constituted under the Board is, in my view, clearly misplaced as is the consequential coercive recovery. 28. Thus, notwithstanding that the proviso has been stated to be effective only from 01.09.2020 by Notification No.63 of 2020 dated 25.08.2020, I cannot but take note of (i) the resolution of the GST Council dated 22.12.2018 introducing the proposal for amendment of Section 50 to allow payment of interest on net cash liability, taking into account admissible credit that amount payable through electronic cash ledger (ii) the GST Council meeting dated 21.06.2019 wherein the recommendation was made to amend Section 50 vide Section 100 of Finance (No.2) Act, 2019 to provide for charging interest on net cash liability (iii) the Council in its meeting on 14.03.2020 recommending charging of interest on net cash tax liabili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear that no opinion or views are expressed on the merits of the matter and that II impugned order is set aside solely for the purpose of enabling personal hearing being given to the writ petitioner; c).The writ petitioner shall deposit a sum of ₹ 10,00,000/- (Rupees Ten Lakhs Only) to the regular CGST account being a portion of demand of ₹ 24,75,183/- within two weeks from today i.e., on or before 08.09.2021. d).If the writ petitioner complies with the above condition, personal hearing shall be on 15.09.2021 (Wednesday) at half past 11 in the office of the first respondent in the II writ petition. e).If the writ petitioner does not comply with the condition of deposit of ₹ 10,00,000/- on or before 08.09.2021, first respondent in II writ petition will be under no obligation to afford personal hearing. f). If the writ petitioner complies with the condition and if personal hearing is held on 15.09.2021, the respondent shall complete the exercise as expeditiously as possible and pass an order within three weeks therefrom i.e., by 06.10.2021 and communicate the same to the writ petitioner under due and proper acknowledgement, until then I impugned o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity, as mentioned in sub-rule (2), is paid. (4) The time limit specified in sub-section (4) of section 16 shall not apply to a claim for re-availing of any credit, in accordance with the provisions of the Act or the provisions of this Chapter, that had been reversed earlier. 11. The petitioner appears to have paid the tax for the month of July, 2017 to December 2019 belatedly. Therefore, the petitioner was earlier called upon to pay interest under section 50 of the respective GST Enactments under Notice on 04.03.2020. Proviso to section 50 (1) on the strength of which the present writ petition has been filed was inserted vide Finance Act (No. 2) Act, 2019. It is not relevant to the facts of the present case. The proviso to section 50 (1) reads as under:- Provided that the interest on tax payable in respect of suppies made during a tax perioid and declared in the return for the said perod furnished after the due date in accordance with the provisions oif Section 39, except where such return is furnished after commencement of any proceedings under Section 73 or Section 74 in respect of the said period, shall be levied on that portion of the tax that is pad by debitin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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