GST interest levy on net cash liability under amended section 50 remained unresolved pending further instructions and response.

Interest on GST under section 50 of the CGST Act was examined in light of the amendment brought into force through section 100 of the Finance (No. 2) Act, 2019 and CBIC instructions indicating recovery only on net cash tax liability for the relevant period, with show-cause notices on gross tax payable to be kept in the Call Book pending retrospective amendment. The Court noted the position taken in similar matters before other High Courts and directed the State and the CGST Council to obtain specific instructions and state their stand on the issue. No final adjudication on the merits of the interest question was made, and the matter was adjourned for further response.

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Issues: Whether the issue relating to levy and recovery of interest on GST was to be examined in light of the amendment to section 50 of the CGST Act and the CBIC administrative instructions, and whether the matter required further response from the State and the CGST Council.

Analysis: The petitioners placed reliance on the notification bringing section 100 of the Finance (No. 2) Act, 2019 into force and on the CBIC communication directing recovery of interest only on the net cash tax liability for the stated period, with SCNs on gross tax payable to be kept in Call Book pending retrospective amendment. The Court also noticed the stand taken in similar matters before other High Courts, but directed the State and the CGST Council to obtain specific instructions and state their position on the issue.

Outcome: No final adjudication was made on the merits of the interest issue, and the matter was posted for a subsequent date for further response.

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