Petitioner challenges interest on late GST return filing, seeks Input Tax Credit declaration.

The petitioner seeks a declaration to avail Input Tax Credit (ITC) under the GST Act before the due date of the monthly return and challenges an order demanding payment of interest for return filing delay. The petitioner argues that ITC is credit on tax already paid and should not attract interest. The State-Respondents contend that interest payment is automatic under the law. The court grants the petitioner leave to file a supplementary affidavit for further proceedings on 26th September 2019.

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Issues: Petitioner seeks declaration of entitlement to avail Input Tax Credit (ITC) under GST Act before due date of monthly return and challenges order demanding payment of interest for delay in filing return.

Analysis:

The petitioner in this case has filed a writ petition seeking a declaration that it is entitled to avail Input Tax Credit (ITC) under the GST Act before the due date of the monthly return and should not be required to pay any interest under section 50 for any delay in filing the return. The impugned order dated 6th June, 2019 demands payment of interest amounting to Rs. 1,52,94,475. Mr. Khaitan, the learned senior advocate for the petitioner, argues that ITC is a credit available on tax already paid, and therefore, interest should not be charged on it. He refers to specific sub-sections of the Central Goods and Services Tax Act, 2017 to support his argument. He also points out that the prescription for the calculation of interest has not been provided yet. Additionally, he refers to the Agenda for the 31st GST Council Meeting and specific items therein to bolster his case.

The learned senior advocate for the petitioner further relies on an extract from the Finance (No.2) Act, 2019, emphasizing certain clauses for the amendment of section 50 through notification. He requests an interim order pending adjudication of the matter. On the other hand, Mr. Majumdar, the learned senior advocate representing the State-Respondents, draws attention to the impugned order dated 6th June, 2019. He highlights paragraphs from the order indicating that the liability to pay interest is automatic and self-imposed under section 50(1) of the WBGST Act, 2017. The notice was issued based on the provisions in sub-section (3) of Section 79.

During the hearing, it is noted that the computation sheet of interest issued to the petitioner has not been disclosed. As a result, the petitioner is granted leave to file a supplementary affidavit, which will be accepted on the adjourned date upon serving an advance copy. The case is listed for further proceedings on 26th September, 2019 at 3 p.m.

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