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2023 (1) TMI 498 - HC - GSTInterest on delayed payment under section 50(1) of Central Goods and Services Act, 2017 - HELD THAT - In the case on hand, Revenue has pegged interest at Rs.5,42,627/- and demand of interest on the portion of the tax paid by utilizing the input tax credit is not sustainable as there is no provision in the C-GST to demand interest. Writ petitioner to demonstrate to the satisfaction of Respondents 1 and 2 undisputed payments (if any) within three weeks from today i.e., on or before 29.12.2022 - On demonstration to the satisfaction of respondents 1 and 2 (as above), the impugned notice will stand set aside. Petition disposed off.
Issues:
Interest on delayed payment under Section 50(1) of the Central Goods and Services Act, 2017. Analysis: The judgment by the Madras High Court addressed the issue of interest on delayed payment under Section 50(1) of the Central Goods and Services Act, 2017. The court noted that the matter was directly covered by previous orders dated 19.12.2019 in specific writ appeals. These appeals arose from a previous case where a Division Bench had differing views, leading to a reference to a third Judge who concurred with one of the Division Bench judges. The court emphasized that the interest demanded on tax paid using input tax credit was not sustainable as there was no provision in the CGST Act for such a demand. The court's order in the present case required the petitioner to demonstrate undisputed payments to the satisfaction of the respondents within a specified timeline. If this demonstration was successful, the impugned notice would be set aside. Failure to demonstrate the payments would result in the dismissal of the writ petition, allowing the impugned order and notice to continue. Upon successful demonstration, the respondents were directed to consider the petitioner's stand, pass an order in accordance with the law, and communicate it within a week. The petitioner was given the option to appeal to the Appellate Authority under Section 107 of the CGST Act if the decision was not in their favor. Overall, the court's judgment provided specific directives for the resolution of the interest on delayed payment issue, ensuring a fair and transparent process for both the petitioner and the respondents. The judgment aimed to uphold the principles of the CGST Act while addressing the specific circumstances of the case before the court.
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