Company allowed to pay tax arrears in instalments due to Covid impact. Payment terms set.

The court granted the petitioner, a private limited company, permission to pay arrears of tax in instalments for the assessment year 2018-2019 due to financial constraints caused by the Covid pandemic. The court directed the respondent to accept the belated return, adjust the partial payment made by the petitioner, and allowed the remaining balance to be paid in equal monthly instalments. Failure to make a single instalment payment would lead to the loss of the benefit granted by the judgment, enabling the respondent to initiate recovery proceedings for the outstanding amounts.

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Issues:
Petitioner seeking permission to pay arrears of tax in instalments due to financial difficulties during the Covid pandemic.

Analysis:
The petitioner, a private limited company registered under the Goods and Service Tax Act, sought permission to pay arrears of tax for the assessment year 2018-2019 in instalments due to financial constraints caused by the Covid pandemic. The respondents initially refused the request, citing the lack of provisions in the Act for such instalment payments. However, the court considered the petitioner's situation, noting that the petitioner did not dispute the tax liability and had already made a payment of &8377; 4 lakhs towards the tax liability for the period in question. The court acknowledged the financial hardship faced by the petitioner and, in light of the petitioner's willingness to resolve the matter, directed the respondent to accept the belated return without insisting on immediate payment of the admitted tax. The court ordered the adjustment of the &8377; 4 lakhs paid by the petitioner towards the tax liability and allowed the petitioner to pay the remaining balance, including interest and late fees, in equal monthly instalments starting from August 25, 2020, to March 25, 2021. It was emphasized that failure to make a single instalment payment would result in the loss of the benefit granted by the judgment, allowing the respondent to initiate recovery proceedings for the outstanding amounts.

This judgment highlights the court's consideration of the petitioner's financial difficulties during the pandemic and the willingness of the petitioner to fulfill its tax obligations in a structured manner. The court balanced the interests of both parties by allowing the petitioner to pay the arrears in instalments while ensuring that the tax liability, interest, and late fees are eventually settled. The judgment serves as a practical solution to address the challenges faced by taxpayers in meeting their financial obligations during unprecedented circumstances, emphasizing the importance of cooperation and timely payment of taxes to maintain compliance with the law.

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