Factory's Petition Against Interest on Delayed CGST Payments Dismissed; Court Upholds Statutory Tax Obligations.

The HC dismissed the writ petitions filed by the petitioner, a factory, challenging the demand for interest on delayed tax payments under the CGST Act 2017. The Court found the petitioner's arguments, including lack of personal hearing and technical issues, untenable. It upheld the respondent's actions, affirming the statutory obligation to pay interest on the total tax liability. The Court concluded that the petition lacked merit and supported the respondent's enforcement of interest demands.

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Issues:
1. Quashing of proceedings by the respondent dated 03.06.2019
2. Completion of adjudication under Section 73 of the Central Goods and Services Tax Act 2017

Analysis:
The petitioner, a Factory situated at Kalaburagi, was assessed under the Central Excise Act, 1944, and served with a notice for recovery of a sum due to delayed filing of returns. The petitioner challenged the notice in W.P. No. 202419/2019, contending that the demand for interest on total tax liability for belated payment was made without considering their representation. The petitioner sought quashing of the order dated 03.06.2019. The petitioner's counsel argued that the demands for interest were incorrect, while the respondent's counsel supported the demands.

The petitioner's grievance included the lack of a personal hearing opportunity and technical difficulties with the online portal leading to a shortfall in upholding books of account for input tax credit eligibility. The petitioner sought waiver of interest. However, the Court found the contentions untenable as there was a significant shortfall, and the petitioner had already approached the authority for relief. The respondent considered relevant provisions of the CGST Act and upheld the statutory obligation to pay interest on the total tax liability, overruling the petitioner's objections.

The Court, after considering all aspects and a relevant judgment, dismissed the writ petitions as lacking merit. The Court held that the petitioner was under a statutory obligation to pay interest on the total tax liability, and the contentions raised could not be accepted in law. The judgment upheld the respondent's actions and dismissed the petitions.

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