2021 (3) TMI 745 - HC - GST

Calculation of amount of Interest - whether interest can be levied on the gross amount or net amount? - Section 50(1) of the Central Goods and Services Tax Act, 2017 - HELD THAT - It is brought to our notice that in the recent budget of 2021-22, an amendment has proposed under Section 103 of the Finance Act to be made applicable with retrospective effect that the interest shall be payable only on the amount where the tax has to be paid in cash and the tax which has been paid through the electronic cash ledger - The assent of the President to this amendment is awaited. Nothing further requires to be adjudicated in the present writ application - Application disposed off.

Summary

The Gujarat High Court clarified that interest under Section 50(1) of the Central Goods and Services Tax Act, 2017 should be levied on the gross amount. An upcoming amendment may change this to apply interest only on cash and electronic ledger payments. The petitioner has paid the liability from the electronic credit ledger, leading to the writ application being disposed of with the option to revive if needed.