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2021 (9) TMI 615 - HC - GSTInterest on tax payable in respect of supplies made during a tax period - during the pendency of this writ petition, Section 50 Sub-Section (1) of the GST Act has been amended by the Finance Act, 2021 under Section 112 of the Finance Act - Assessment Year 2017-18 and 2018-19 - HELD THAT - In view of this amendment, the impugned notice of demand relating to interest in question is not sustainable in law and is set aside. Petition disposed off
Issues:
Challenge to demand notice for interest under Section 50 Sub-Section (1) of the GST Act for Assessment Year 2017-18 and 2018-19. Analysis: The petitioner contested an impugned demand notice dated 2nd March, 2020, related to interest under Section 50 Sub-Section (1) of the GST Act for the Assessment Year 2017-18 and 2018-19. The writ petition challenging this notice was filed on 19th July, 2019. During the pendency of the petition, an amendment to Section 50 Sub-Section (1) of the GST Act was made by the Finance Act, 2021. The amendment substituted the proviso for interest calculation on tax payable for supplies made during a tax period and declared in the return after the due date. The new proviso clarified that interest shall be payable on the tax debited from the electronic cash ledger. Considering this legal amendment, the court found the impugned demand notice for interest unsustainable and set it aside. The court, in light of the amended legal position, disposed of the writ petition (W.P.A. No.11244 of 2020). However, it was highlighted that the setting aside of the demand notice does not prevent the respondent from recalculating the demand after incorporating the changes brought about by the amendment to Section 50 Sub-Section (1) of the GST Act. This indicates that while the current demand notice was invalidated, the respondent is allowed to reassess the interest amount in accordance with the amended provisions. In conclusion, the judgment addressed the challenge to the demand notice for interest under the GST Act, emphasizing the impact of the legal amendment on the calculation of interest payable. The court's decision to set aside the impugned notice was based on the amended proviso under Section 50 Sub-Section (1) introduced by the Finance Act, 2021. The ruling allowed for the respondent to recalculate the demand in compliance with the revised statutory provisions, ensuring a fair and accurate determination of the interest amount owed by the petitioner.
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