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TMI Blog2020 (4) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... at the petitioner was permitted to file FORM GSTR-3B for September, 2019 with taxes payable for August, 2017 and the same has been accepted by the system and, accordingly, the amount of tax payable for August, 2017, which was lying with the designated bank has now been credited to the Government account and the taxes payable are now shown as nil. Thus, the principal grievance voiced in the petition, therefore, no longer survives. Liability to pay interest for eighteen months from 21.9.2017 to October 2019 at a substantially high rate of 18% per annum - HELD THAT:- Despite the fact that the petitioner had approached them at the earliest point of time, the respondent authorities maintained silence for a considerable period of time and did not provide remedial measures till directed by this court. The errors in uploading the return were not on account of any fault on the part of the petitioner but on account of error in the system. In these circumstances, it would be unreasonable and inequitable on the part of the respondents to saddle the petitioner with interest on the amount of tax payable for August 2017, despite the fact that the petitioner had discharged its tax liability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ularization of the Petitioner s GSTR-3B for August, 2017 (Annexure- B ) by bringing it in line with GSTR-1 furnished by the Petitioner (Annexure- D ) in respect of information and details including payment of tax due by the Petitioner for August, 2017; (C) That Your Lordships may be pleased to issue a Writ of Mandamus or any other appropriate writ, direction or order, directing the Respondents, their servants and agents to make an appropriate entry in the Petitioner s electronic liability register corresponding to the Unique Identification Number in respect of discharge of the Petitioner s tax liability for August, 2017; 2. The first petitioner Messrs Vishnu Aroma Private Limited (hereinafter referred to as the petitioner ) is engaged in manufacturing Pan Masala, which are sold under the brand name of Vimal . The petitioner has been registered as a manufacturer and supplier of Pan Masala. It is the case of the petitioner that it has been paying liabilities under the Goods and Services Tax Acts and also complying with the procedural formalities laid down under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act ), Integrated Goods and Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n portal in the Form as prescribed under rule 87(1) of the CGST Rules is maintained for the petitioner. 2.5 When any payment is made by an assessee by internet banking, a number for the challan for making payment is generated, which is known as Challan Portal Identification Number (CPIN). For two challans dated 19.9.2017, through which the petitioner has paid a total sum of ₹ 114.51 crores (rounded off), such CPINs have been generated on the common portal, and such numbers appear on the challans with other details. CPIN for payment of taxes by the petitioner are 17092400195007 and 17092400195744. 2.6 On successful credit of the amount to the concerned Government account maintained in the authorised bank, a Challan Identification Number is generated by the collecting bank, and the same is indicated in the challan as laid down under sub-rule (6) of rule 87 of the CGST Rules. In the petitioner s case, such CINs have been generated, and such Challan Identification Numbers have been recorded on the challans also, which are HDFC17092400195007 and HDFC17092400195744. 2.7 On receipt of the Challan Identification Number from the collecting bank, such amount is credited to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... common portal which was introduced only in July, 2017 was not capable of taking such a huge load. Consequently, the petitioner s efforts to upload GSTR-3B on 20th September, 2017 failed. On the next day, that is, on 21st September, 2017, the System crashed. Due to this unfortunate turn of events, the System accepted the petitioner s GSTR-3B on 21.9.2017, but the information and details in all the columns of this return were shown as zero , though the payment of tax liability of the month had also been fully made by the petitioner. 2.12 Since GSTR-3B was uploaded on the common portal in the above manner, the requirement of sub-rule (2) of rule 88 of the CGST Rules, that is, indicating the Unique Identification Number relating to discharge of the liability in the corresponding entry in the electronic liability register has not been made in the System, which operates on its own, namely that, the petitioner has no access to make any entry, etc. in the System, and consequently not in the electronic liability register maintained under rule 85 of the CGST Rules also. 2.13 The petitioner, therefore, immediately informed the Assistant Commissioner in charge of its unit vide a letter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cers, and accordingly, the previous Circular dated 1.9.2017 was kept in abeyance till such time. Thus, the assurance given to the petitioner by the Officers manning the Help Desk did not result in any positive action or development. The return in form GSTR-3B for August, 2017 continues to have all information and details as zero , and consequently, the entry about discharging tax liability of August, 2017 in the petitioner s electronic liability register as required under rule 88(2) of the CGST Rules is still not made. 2.17 In this view of the matter, the petitioner had been continuously approaching all the responsible officers of Ahmedabad-North Commissionerate, and also the higher officers like the Chairman of the Central Board of Indirect Taxes and Customs as well as the Assistant Director in charge of the System of the common portal. The petitioner has submitted letters and representations in writing to the Chief Commissioner of Ahmedabad Zone, the Assistant Director of DGGSTI, the Deputy Commissioner of CGST in charge of the petitioner s factory, the Nodal Officer in charge of the Nodal Office for sorting out system related problems, the Assistant Commissioner in charge of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommon Error-I of Annexure to the above Circular, and as clarified for cases of Liability was under reported , the petitioner should pay the liability of tax with interest. 2.19 In the aforesaid factual background, the situation that still prevails is that a formal entry in the petitioner s electronic liability register for discharging tax liability of August, 2017 is still not made in the system though the petitioner had paid the entire tax liability of August, 2017 by way of cash payment aggregating to ₹ 114.51 crores (rounded off) and that of ₹ 14.12 crores (rounded off) from legally availed ITC. Though true and full information about the tax liability and also its payment in respect of August, 2017 stands reflected in the return furnished in Form GSTR-1, the other return in Form GSTR-3B shows zero liability and also nothing about discharging the actual tax liability of August, 2017, the Unique Identification Number relating to discharge of such tax liability in August, 2017 is still not made in the System, that is, on the common portal, in respect of the petitioner s electronic liability register. It is the case of the petitioner that despite having paid the enti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the designated bank has now been credited to the Government account and the taxes payable are now shown as nil. 6. In the light of the above events, the principal grievance voiced in the petition, therefore, no longer survives. However, the issue regarding liability to pay interest for eighteen months from 21.9.2017 to October 2019 at a substantially high rate of 18% per annum still remains to be addressed. 7. Mr. Paresh Dave, learned advocate for the petitioner invited the attention of the court to the averments made in the memorandum of petition, to point out that it is only after issuing the letter dated 7.3.2019, on the petitioner s inquiry, that the respondents informed the petitioner that its case would fall in the appropriate table set out in Circular No.26/26/2017-GST dated 29.12.2017. Reference was made to paragraph 7 of the affidavit-in-reply filed on behalf of the respondents No.1, 2, 3 and 4, to point out that it is admitted therein that the petitioner was under a bona fide belief that since the issue would be resolved after filing GSTR-1 it did not enter into any e-mail or correspondence with any other authority. Referring to the affidavit-in-rejoinder filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posited that tax payable for such period; however, on account of glitches in the system such amount could not be credited to the Government account. It was submitted that the petitioner had thereafter immediately approached the respondent authorities for resolving the issue; however it was on account of the default on the part of the respondent authorities that the error could be corrected only in October, 2019. It was submitted that on account of default on the part of the respondents, the petitioner should not be saddled with the liability of paying excessive interest at the rate of 18% for the intervening period between the date of filing of the return and the filing of form GSTR-3B in October, 2019. 8. This court has also heard Mr. Nirzar Desai, learned senior standing counsel for the respondents, who has reiterated the averments made in the affidavit in reply filed on behalf of the respondents. 9. From the facts noted hereinabove, it is apparent that the petitioner had uploaded the return for August, 2017 within the period provided therefor. The petitioner paid an amount aggregating to ₹ 114,51,11,746/- in cash towards the tax liability and also made payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be unreasonable and inequitable on the part of the respondents to saddle the petitioner with interest on the amount of tax payable for August 2017, despite the fact that the petitioner had discharged its tax liability for such period well within time. 13. The respondents, in paragraph 19 of their affidavit-inreply, have submitted that CIN is generated after deposit of money by the petitioner for the purpose of payment of tax. CIN is generated by the authorised banks/ Reserve Bank of India (RBI) when payment is actually received by such authorised banks or RBI, which then is seen as credit balance in the electronic cash ledger of the petitioner. In response to such submission made on behalf of the respondents, the learned advocate for the petitioner invited the attention of the court to the averments made in paragraphs 5.4 and 5.5 of the petition, wherein it has been stated that when any payment is made by an assessee by internet banking, a number for the challan for making payment is generated, which is known as Challan Portal Identification Number (CPIN). For two challans dated 19.9.2017, through which the petitioner has paid a total sum of ₹ 114.51 crores (rounded off), ..... X X X X Extracts X X X X X X X X Extracts X X X X
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