Today, i.e. 02.03.2020, the Hon’ble High Court of Delhi at New Delhi, has in a petition challenging the demand notice issued by Department over payment of interest on gross tax liabilty, granted stay in the matter of Sunrise Autoworld Pvt. Ltd. v. Union of India.
The Department has sought to levy interest even on the input tax credit which stood credited in the electronic credit ledger and hence was already lying with the Government. That it is settled principle of law that input tax credit is as good as tax paid, and hence there was no delayed payment of tax in case where the Petitioner had duly adjusted ITC with liability as per GSTR-3B in its books.
That in the instant case the Petitioner has already paid and deposited admitted interest payable on delayed cash payment of tax liability. However, the Respondent Assistant Commissioner has issued demand notice seeking to recover interest on gross tax liability arising due to belated filing of statement in Form GSTR-3B.
The matter was argued by Adv. Puneet Agrawal, with Adv. Gaurav Gupta.
GST Law India is a blog on GST and allied commercial laws managed by members of the law firm ALA Legal.
Very well done Puneet Bhai.
It is very much surprising that the Government is stretching issues further which it has got no right. Govt. should collect taxes which is reasonably due to it. By no stretch of imagination interest can be charged on gross liability. It can take leaf from the commercial transactions in India. Even Supreme court has held in many cases that too technical and too formal a view is not accepted. The mind set of the Government needs to be broaden and should focus on ease of doing business. Govt should focus on ” THICK ON THE BEST AND THIN ON THE REST “
Very nice