Direction issued to the appropriate authority to compute the interest liability for belated remittances of cash and refund the balance of the amount collected from the petitioner.
Section 50 of the CGST Act, 2017 — Interest -- The petitioner is engaged in providing telecom services throughout India. It is alleged that the petitioner have entered incorrect State Code in some of the invoices, due to which excess SGST has been paid in the State of Andhra Pradesh, on receipt of the notice dated 18.03.2019, the petitioner paid the tax. Thereafter, the petitioner was directed to pay an amount of Rs.1,80,00,000/- towards interest. The Petitioner paid the said amount under protest through Form GST PMT-06 dated 25.06.2019. The petitioner submitted that the above said amount has not been passed over to any other person. The petitioner filed an application dated 12.08.2019 seeking refund of said amount under Section 54 of the Act on the ground that return that is required to be filed under Section 39 of the Act, is GSTR-3, but as the same was kept under suspension, they are filing GSTR-3B, and the same cannot be taken in lieu of GSTR-3. His refund application was rejected. The petitioner’s appeal was also dismissed. The petitioner further submitted that interest is payable only on the net tax liability after adjusting the admissible ITC. The court observed that as per the administrative instructions dated 18.09.2020, the interest is liable on the net cash tax liability.
Held that:- The Hon’ble High Court set aside the impugned orders dated 18.10.2019 and 10.08.2020 and further directed the respondent to calculate the interest on the net cash tax liability.
Direction issued to the appropriate authority to compute the interest liability for belated remittances of cash and refund the balance of the amount collected from the petitioner.
Section 50 of the CGST Act, 2017 — Interest -- The petitioner is engaged in providing telecom services throughout India. It is alleged that the petitioner have entered incorrect State Code in some of the invoices, due to which excess SGST has been paid in the State of Andhra Pradesh, on receipt of the notice dated 18.03.2019, the petitioner paid the tax. Thereafter, the petitioner was directed to pay an amount of Rs.1,80,00,000/- towards interest. The Petitioner paid the said amount under protest through Form GST PMT-06 dated 25.06.2019. The petitioner submitted that the above said amount has not been passed over to any other person. The petitioner filed an application dated 12.08.2019 seeking refund of said amount under Section 54 of the Act on the ground that return that is required to be filed under Section 39 of the Act, is GSTR-3, but as the same was kept under suspension, they are filing GSTR-3B, and the same cannot be taken in lieu of GSTR-3. His refund application was rejected. The petitioner’s appeal was also dismissed. The petitioner further submitted that interest is payable only on the net tax liability after adjusting the admissible ITC. The court observed that as per the administrative instructions dated 18.09.2020, the interest is liable on the net cash tax liability.
Held that:- The Hon’ble High Court set aside the impugned orders dated 18.10.2019 and 10.08.2020 and further directed the respondent to calculate the interest on the net cash tax liability.