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TMI Blog2020 (4) TMI 664X X X X Extracts X X X X X X X X Extracts X X X X ..... icable when any tax has not been paid or short paid. It contemplates that a show Cause Notice is to be issued to the assessee calling upon him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under Section 50 of the GST Act. Assuming that sub section (1) of Section 73 is not applicable, before penalizing the assessee by making him pay interest, the principles of natural justice ought to be complied with before making a demand for interest under sub section (1) of Section 50 of the GST Act. Consequence of demanding interest and non-payment thereof is very drastic - impugned demand has been set aside only on the ground of the breach of the principles of natural justice by gran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingle Judge that no notice as contemplated under Section 73 of the GST Act was issued to the respondent- assessee before quantifying interest amount and attaching Bank account of the respondent-assessee. In paragraph 6, the learned Single Judge has held that issuance of a show Cause Notice is sine qua non to proceed with the recovery of interest payable under Section 50 of the GST Act and penalty leviable under the provisions of the GST Act and the Rules. It is further held that interest payable under Section 50 of the GST Act has been determined by the third respondent - Authority without issuing a show Cause Notice which is in breach of the principles of natural justice. Therefore, both the orders at Annexures - J and L were quashed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be notified by the Government on the recommendations of the Council. Further, sub section (1) to sub section (3) of Section 73 of the GST reads thus : 73. (1) Where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilized for any reason, other than the reason of fraud or any wilful-misstatement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould not pay the amount specified in the notice along with interest payable thereon under Section 50 of the GST Act. 12. Assuming that sub section (1) of Section 73 is not applicable, in our view, before penalizing the assessee by making him pay interest, the principles of natural justice ought to be complied with before making a demand for interest under sub section (1) of Section 50 of the GST Act. Consequence of demanding interest and non-payment thereof is very drastic. 13. Therefore, the learned Single Judge rightly held in paragraph 6 of the impugned judgment that issuance of show Cause Notice is sine qua non to proceed with the recovery of interest payable in accordance with sub section (1) of Section 50 of the GST Act. 14. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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