TaxTMI 
TaxTMI 
2022 (2) TMI 1051
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....ut any adjudication proceeding under Section 73 or 74 of the CGST Act which has not been done admittedly in this case. Petitioner has by way of his reply dated 9th March 2020 (Annexure-5) disputed the liability. According to the petitioner, no rules have been prescribed in terms of Section 50 Sub-Section (2) for computation of the interest under Sub-Section (1). Interest cannot be charged on the gross tax liability. In this regard learned counsel for the petitioner has referred to the Finance Act, 2021. Section 112 has inserted a proviso to Section 50 of the CGST Act in the following terms : "112. In Section 50 of the Central Goods and Services Tax Act, in sub-section (1), for the proviso, the following proviso shall be substituted and shall be deemed to have been substituted with effect from the 1st day of July, 2017, namely :-- "Provided that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the said period furnished after the due date in accordance with the provisions of Section 39, except where such return is furnished after commencement of any proceedings under Section 73 or Section 74 in respect of the said period, ....
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....filing of return result "Interest" and "Late Fee" respectively and the two, i.e. interest & late fee are not identical." 6. Learned counsel submits that by notification no.13/2017 Central Tax dated 28.06.2017 the rate of interest per annum has also been notified for the purposes of calculation of interest which has come into force from 1st July 2017. According to the respondents, if the returns have been filed belatedly and the tax dues have not been paid within time by default interest and late fee are confirmed demands within the meaning of Section 50 and 47 of the Act respectively which do not require any adjudication process under Section 73 or 74 of the CGST Act. Learned counsel for the respondent however does not dispute that the same issue has been considered and decided by this Court in the case of Mahadeo Construction Co. (supra) where the following two questions were framed for answer :- (i) Whether interest liability under Section 50 of the Central Goods and Services Tax Act, 2017 (for short 'CGST Act') can be determined without initiating any adjudication process either u/s 73 or 74 of the CGST Act in the event of an assesse raising dispute towards liability of inter....
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....Daejung Moparts Pvt. Ltd. and ors, has taken similar view. The said Writ Appeals were initially decided by a Two Judges Bench of the Hon'ble Madras High Court and divergent views were taken by the Hon'ble Judges on the issue of initiation of adjudication proceedings before imposing liability of interest under Section 50 of the Act. The matter was, thus, referred to learned Third Judge, which was decided vide Judgment dated 19th December 2019 in the following terms:- "27. A careful perusal of the above said provision would show that every person who is liable to pay tax, but fails to pay the same or any part thereof within the period prescribed shall, on his own, pay interest at such rate not exceeding 18% for the period for which the tax or any part thereof remains unpaid. Thus, sub clause (1) of Section 50 clearly mandates the assesse to pay the interest on his own for the period for which the tax or any part thereof remains unpaid. The liability to pay interest is evidently fastened on the assesse and the same has to be discharged on his own. Thus, there cannot be any two view on the liability to pay interest under Section 50(1) of the said Act. In other words, such liability i....
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....uting their liability to pay the interest on the delayed payment of tax. On the other hand, they are disputing the quantum of interest claimed by the Revenue by contending that the interest liability was worked out on the entire tax liability instead of restricting the liability to the extent of tax unpaid. It is further seen that the writ petitioners have placed some worksheets, wherein they have claimed some ITC credit for every month as well. Their grievance before the Writ Court was that the impugned bank attachment ought not to have been resorted to without determining the actual quantum of liability. 32. Therefore, it is evident that the dispute between the parties to the litigation is not with regard to the very liability to pay interest itself but only on the quantum of such liability. In order to decide and determine such quantum, the objections raised by each petitioners shall have to be, certainly, considered. Undoubtedly unilateral quantification of interest liability cannot be justified especially when the assesse has something to say on such quantum. The Writ Court, thus, in the above line, has disposed the writ petitions, that too, on a condition that the petitione....