AI Drafter 
TaxTMI 
TaxTMI 
2021 (6) TMI 826
X X X X Extracts X X X X
X X X X Extracts X X X X
....eared to (i) have not paid interest Rs. 4,275/-(IGST Rs. 428/-, CGST Rs. 1,932/- and SGST Rs. 1,915/-) payable on delayed payment of GST for the period July- 2017 to Nov- 2017 which appeared to be recoverable from them under Section 50 of the Goods and Service Tax Act, 2017 (GGST Act, 2017 in short) and Rajasthan Goods & Service Tax Act, 2017 (RGST Act 2017 in short) and Section 20 of the IGST Act, 2017; and (ii) have not paid/ short paid Goods and Service Tax (GST in short) amounting to Rs. 91,20,399/- (IGST Rs. 45,75,623/-+ CGST Rs. 22,72,388/- + SGST Rs. 22,72,388/-) during the period Dec- 2017 to March- 2019 by contravening the provisions of Sections 37, 39, 49, 50 & 59 of the Goods and Service Tax Act, 2017 and Rajasthan Goods & Service Tax Act.2017 read with Rule 59 and 61 of the Goods and Service Tax Rules, 2017 (CGST Rules, 2017 in short) and Section 20 of IGST Act,2017. The GST so evaded and not paid by them appeared to be recoverable from them in terms of Section 74 read with Section 76 the Goods and Service Tax Act, 2017 and Rajasthan Goods & Service Tax Act, 2017 as per facts mentioned below 2.2 Based on an intelligence, an investigation was initiated and the busines....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... all the above GST returns after due date and also deposited the GST after due date i.e. due date for filing of GSTR-3B return of the respective month and informed that he will deposit the interest payable on late payment of GST for the respective months. • He further informed that they will file all the pending GST returns for the period Aug- 2018 to Mar-2019 very soon and will also deposit the GST payable along with interest and penalty for the said period. • The Taxable value of taxable supplies made during the period July- 2017 to Mar- 2018 is Rs. 2,38,60,384/- as per their Invoices issued and Rs. 2,39,77,711/- as per GSTR- 3B filed for the aforesaid period. In this regard, he assured to inform the reason of difference thereof, very soon. • The total GST liability for the period July- 2017 to March- 2018 is IGST Rs. 19,83,435/-, CGST Rs. 11,51,406/- and SGST Rs. 1,151,406/- as per Invoices/sales ledger and has deposited IGST Rs. 19,83,435/-, CGST Rs. 11,61,298/- and SGST Rs. 11,61,298/- in their GSTR- 3B filed for the respective periods. Further informed that they will amend the same in the Annual return to be filed for the period 2017-18 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....8 02.07.2018 104 4 March-18 02.07.2018 73 5 April-18 02.07.2018 41 6 May-18 05.07.2018 15 7 June-18 20.10.2018 92 8 July-18 27.11.2018 95 2.10 On-going through available invoices and other documents it has been observed that the appellant has been charging and collecting GST from their clients, but they had not deposited that GST so collected in govt. exchequer within the stipulated time period. It therefore, appears that the notice intentionally and wilfully suppressed the fact of charging and collecting the GST from their clients and deliberately avoided depositing the GST and furnishing of the GST returns within the stipulated time period with a clear and wilful intention to evade payment of GST. In the era of self-assessment as stipulated under the provisions of GST, responsibilities to make correct classification of supply, determine the GST payable, pay GST and follow the provisions of the Act and Rules framed thereunder lie with the appellant, which they have completely failed to fulfil. As per Section 122(1) (iii) of the CGST Act, 2017, where a taxable person who collects any amount as tax but fails to pay....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lso not deposited complete GST payable for the period under demand, which is recoverable under the provisions of Section 74 read with Section 76 of the CGST Act, 2017 and RGST Act 2017 and Section 20 of IGST Act, 2017:- (vi) The appellant has not deposited any interest on late payment of GST as payable under Section 50 of CGST Act, 2017. (vii) The Taxable value of taxable supplies made during the period July-2017 to Mar- 2018 is Rs. 2,38,60,384/- as per their Invoices issued and Rs. 2,39,77,711/- as per GSTR- 3B filed for the aforesaid period. The appellant had assured to furnish the reasons of such difference in the value of clearance, but the appellant has failed to furnish any reason till date. Since the appellant has not furnished any reason for difference thereof, the department has no option other than to consider higher taxable value i.e. the value of supply shown in the GSTR- 3B filed by them, for computation of GST payable the period 2017-18 (July-17 to Mar- 18). (viii) The appellant appeared liable to pay IGST Rs. 45,75,623/- + CGST Rs. 22,72,388/- + SGST Rs. 22,72,388/- for the period Dec-2017 to March- 2019; against which the appellant has dep....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and collected the tax amount from their clients and failed to deposit the same within the stipulated time period. Further interest for delayed/ non-payment of GST within the stipulated period, also appeared to be recoverable from them in terms of Section 50 of the CGST Act, 2017 and since the appellant appeared to have contravened the provisions of the Act & Rules referred above with intention to evade service tax, they also appeared to be liable to penalty under Section 122 of the Act. 3. Accordingly, M/s Sinex Vision, Plot No.113,Adinath Nagar, G-1, Krishna Villa, Sirsi Road, Jaipur, were called upon to show cause as to why: (i) The GST amounting to Rs. 91,20,399/- (IGST Rs. 45,75,623/- + CGST Rs. 22,72,388/- + SGST Rs. 22,72,388/-) should not be demanded and recovered from them under proviso to Section 74 read with Section 76 of Goods and Service Tax Act, 2017 and Rajasthan Goods & Service Tax Act, 2017 and Section 20 of IGST Act,2017 and the amount of IGST Rs. 36,83,299/-, CGST Rs. 11,23,195/- and SGST Rs. 11,23,195/- so deposited by the appellant should not be appropriated against the total demand of Rs. 91,20,399/- (IGST Rs. 45,75,623/- + CGST Rs. 22,72,388/- + S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the period July, 2017 to November,2017 ; (iii) Imposed a penalty equal to the tax amount confirmed under (i) above, under Section 122 (2) (b) of the Goods and Service Tax Act, 2017 and corresponding Rajasthan Goods & Service Tax Act, 2017 and Section 20 of lGST Act, 2017 upon them. However, in terms of Section 74(11) of CGST Act, 2017, if the tax. amount of Rs. 91,20,399/- and interest thereon is paid within a period of thirty days of the date of receipt of this order, the penalty payable shall be fifty percent (50%) of the amount of tax, subject to the condition that the amount of such reduced penalty is also paid within the said period of thirty days: 5. Being aggrieved with the impugned order dated 30.06.2020, the appellant has filed appeal on the following grounds which are summarized as under: At the outset, the appellant deny all the allegations contained in the impugned order as incorrect, unsustainable, illegal and arbitrary on the following grounds, which are independent and without prejudice to one another:- 1. That the impugned order has been passed without considering the submissions made by the appellant and thus deserves to be set-aside on this....
X X X X Extracts X X X X
X X X X Extracts X X X X
....till date in respect of services so provided to its customers. As on 31.03.2019 the total trade receivables are Rs. 1.20 crore approx. On account of such huge trade receivables outstanding in respect of invoices raised during the impugned period the appellant could not make the payment of tax for the period post July-18 and file returns as it is a small service provider with limited means of finances and is mainly dependent on its realization from customers to meet the working capital requirement. The liquidity position of the appellant has worsened with passage of time as it is waiting for realizing the amount from its customers and is committed to deposit the same as soon as payment is received from them. The net liability which is required to be paid after adjustment of ITC available for the said period would be Rs. 16,71,210/- as against the demand of Rs. 31,90,710/- incorrectly stated in the show cause notice as well as impugned order. 4. That the Ld. Adjudicating authority had wrongly relied upon the decision of Megha Engineering and Infrastructure Ltd. wherein it was held that until return is filed no credit would be available in electronic credit ledger and thus th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....1.60 lacs from its customers. Therefore, the allegation of the tax collected and deposited is not sustainable for imposition of penalty on the appellant. That without causing prejudice the submissions that no penalty is imposable on the appellant in this case it is submitted that the amount of penalty has been wrongly calculated as Rs. 91,20,399/- as the appellant had already deposited the due tax for the period Dec-17 to July-18 amounting to Rs. 59,29,689/- (IGST of Rs. 36,83,299/CGST of Rs. 11,23,195/- and SGST of Rs. 11,23,195/-) which has been ordered to be appropriated to the government account. Such amount deserves to be excluded from the amount of penalty alongwith the amount of ITC for the period Aug-18 to Mar-19. That the appellant is committed to deposit GST as soon as it receives payment from its customers. The appellant is making all the efforts day in and out for realising payment from its customers by making regular correspondence and visits to their offices. The appellant is facing severe liquidity crunch and if not given some more time to discharge its liabilities then it would put an end to its business operations. The appellant has cited followin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....calendar month or part thereof. Section 49 of CGST Act, 2017 reads as- (1) Every deposit made towards tax, interest, penalty, fee or any other amount by a person by internet banking or by using credit or debit cards or National Electronic Fund Transfer or Real Time Gross Settlement or by such other mode and subject to such conditions and restrictions as may be prescribed, shall be credited to the electronic cash ledger of such person to be maintained in such manner as may be prescribed. (2) The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41, to be maintained in such manner as may be prescribed. (3) The amount available in the electronic cash ledger may be used for making any payment towards tax, interest, penalty, fees or any other amount payable under the provisions of this Act or the rules made thereunder in such manner and subject to such conditions and within such time as may be prescribed. (4) The amount available in the electronic credit ledger may be used for making any payment towards output tax under this Act or under the Int....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of the Government in the authorised bank shall be deemed to be the date of deposit in the electronic cash ledger; (b) the expression,- (i) "tax dues" means the tax payable under this Act and does not include interest, fee and penalty; and (ii) "other dues" means interest, penalty, fee or any other amount payable under this Act or the rules made thereunder Section 50 of CGST Act, 2017 stipulates that interest shall be payable on delayed payment of tax, which reads as - (1) Every person who is liable to pay tax in accordance with the provisions of this Act or the rules made thereunder, but fails to pay the tax or any part thereof to the Government within the period prescribed, shall for the period for which the tax or any part thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be notified by the Government on the recommendations of the Council. (2) The interest under sub-section (1) shall be calculated, in such manner as may be prescribed, from the day succeeding the day on which such tax was due to be paid. Section 59 of CGST Act, 2017 stipulates that- Every registered person sha....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... person paying tax under section 10 or section 51 or, as the case may be, under section 52 shall furnish a return specified under sub-section (1) of section 39 in FORM GSTR-3* electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner. Now I am taking the issue for discussion 8 At the outset, the appellant pleaded that the demand for the period August-2018 to March-2019 has been confirmed without considering the input tax credit available with him during the said period of demand. The appellant submitted that the total ITC for the said period are available amounting to Rs. 15,19,500/- (IGST is Rs. 2,43,632/-, CGST is Rs. 6,37,934/- and SGST is Rs. 6,37,934/-). Further, he submitted that after setting off the input credit from the output tax liability the net demand of GST payable is Rs. 16,71,210/- as against the demand of Rs. 31,90,710/- . In the support of his contention the appellant has submitted the copy of voucher register in which details of Suppliers, GSTN No. Invoices No. Date of Invoices, Taxable value and amount of GST (IGST, CGST, SGST +Cess ) etc., have been mentioned (as Annexure-'D' of subm....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... - (1) The liability to pay tax on services shall arise at the time of supply. The time of supply of services shall be the earliest of the date of issue of invoice by the supplier or the date of provision of service, if the invoice is not issued within the prescribed period or the date on which the recipient shown the receipt of services in his books of accounts. In the instant case, I observed that the appellant has issued the invoices for his whole outward supply and in the invoices he has charged the GST also. Therefore, it is very much obvious that liability of tax is arised upon the appellant at the time of issue of invoices and accordingly he should have to discharge his tax liability by filing the returns within the stipulated time but he did not do so. Hence he has violated the provisions of GST Act and rules made thereunder. In view of the above legal provisions I am not agree with the assessee contention that he did not deposit his tax liability due to non payment received from his customers. Further, appellant submitted that the contention of department that he has collected the tax for period Dec-2017 to March-2019 from its customers but not deposited ....