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TMI Blog2024 (5) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... T Act, 2017 - Therefore, the question of the petitioner transitioning the amount that was wrongly claimed as input tax credit under the CENVAT Credit Rules, 2004 did not arise. The Department however committed a mistake by sanctioning the refund to the petitioner on 17.07.2018 pursuant to refund claim filed by the petitioner. There has to be restitution of the unjust benefit gained by a dealer/person. These provisions have been framed to ensure that there is proper restitution. Thus, no case is made out to interfere with the impugned order. Therefore, the impugned order is sustainable and this Writ Petition is liable to be dismissed. Petition dismissed. - Hon'ble Mr. Justice C. Saravanan For the Petitioner : Mr. S. Murugappan For the Respondents : Mr. J.K. Jeyaselan Government Advocate (Civil Side) ORDER The petitioner is aggrieved by the impugned order dated 22.11.2021 passed by the second respondent Appellate Deputy Commissioner (ST) (FAC) in AP/GST/138/2020. 2. By the impugned order dated 22.11.2021, the second respondent Appellate Deputy Commissioner (ST) (FAC) has partly allowed the appeal filed by the petitioner in AP/GST/138/2020. Relevant portion of the impugned order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the Assistant Commissioner (ST), Ariyalur in Order Ref No: ZA330320001635A, Dated: 19.03.2020 and upheld the demand of interest at 18% u/s.50 on the erroneous refund which was accepted and paid by the Appellant. Thus, the appeal stands Partly Allowed on the terms aforesaid. 3. The brief facts of the case are that the petitioner had imported a consignment of split coriander seed and had paid basic customs duty. The petitioner availed Input Tax Credit (ITC) for a sum of Rs. 42,88,194/- on the basic customs duty paid by the petitioner under the provisions of CENVAT Credit Rules, 2004 presumably on the ground that the petitioner was a registered dealer. 4. This amount was transited by the petitioner by filing TRAN-1 under Section 142 of the CGST Act. Since the amount was lying unutilised, the petitioner claimed for refund of the aforesaid amount which was sanctioned on 17.07.2018 in Form RFD-06. 5. On realizing the mistake, the Department issued notice dated 01.02.2020. In the notice dated 01.02.2020, the petitioner was directed to pay the aforesaid refund amount along with interest under Section 50 of the CGST Act, 2017, failing which, the action initiated will be taken und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the first respondent which has culminated in the impugned order. By the impugned order, the second respondent has dropped the penalty imposed on the petitioner under Section 74 of the CGST Act, 2017 but has uphold the levy of interest under Section 50 of the CGST Act, 2017. 9. This Writ Petition has been filed to review the aforesaid order as the appellate remedy before the Appellate Tribunal that is contemplated under Section 109 of the respective GST enactments and not yet to be constituted. 10. The learned counsel for the petitioner would submit that interest under Section 50 of the CGST Act, 2017 cannot be imposed on the petitioner in view of the specific language in Section 50(1) (3) of the CGST Act, 2017. 11. Explaining further, the learned counsel for the petitioner would further submit that Section 50(1) of CGST Act, 2017 will apply to a case where a person who is liable to pay tax in accordance with the provisions of this Act or the Rules made thereunder, but fails to pay the tax or any part thereof to the Government within the period prescribed, for the period for which the tax or any part thereof remains unpaid. It is submitted that only such a person shall pay, on hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld draw attention to Rule 121 of the TNGST Rules, 2017, as per which, the amount credited under Sub-Rule (3) to Rule 117 of the Rules may be verified and proceedings under Section 73 of the Act or, as the case may be, Section 74 of the Act shall be initiated in respect of any credit wrongly availed, whether wholly or partly. Hence, the learned Government Advocate (Civil Side) for the respondents prayed for dismissal of this Writ Petition. 17. By way of rejoinder, the learned counsel for the petitioner would submit that both Section 74 and Section 50 of the CGST Act, 2017 apply to refund of tax. This case pertains to the erroneous refund of input tax credit as credit was availed and recognized under Section 142 of the Act. 18. I have considered the arguments advanced by the learned counsel for the petitioner and the learned Government Advocate (Civil Side) for the respondents. 19. Admittedly, the petitioner was not entitled to avail input tax credit on the Basic Customs Duty paid under the Customs Act, 1962, under the provisions of the CENVAT Credit Rules, 2004. 20. Under Section 140 of the CGST Act, 2017, only input tax credit lying un-utilised under the CENVAT Credit Rules, 2004 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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: Provided that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the said period furnished after the due date in accordance with the provisions of section 39, except where such return is furnished after commencement of any proceedings under section 73 or section 74 in respect of the said period, shall be levied on that portion of the tax that is paid by debiting the electronic cash ledger. (2) The interest under sub-section (1) shall be calculated, in such manner as may be prescribed, from the day succeeding the day on which such tax was due to be paid. (3) A taxable person who makes an undue or excess claim of input tax credit under subsection (10) of section 42 or undue or excess reduction in output tax liability under subsection (10) of section 43, shall pay interest on such undue or excess claim or on such undue or excess reduction, as the case may be, at such rate not exceeding twenty four per cent., as may be notified by the Government on the recommendations of the Council ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 73 - Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any wilful-misstatement or suppression of facts. (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 utilised 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 utilised input tax credit, requiring 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 and a penalty leviable under the provisions of this Act or the rules made thereunder. Section 74- Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any wilful-misstatement or suppression of facts. (1) Where it appears to the proper officer that any ..... 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