TaxTMI 
TaxTMI 
2022 (9) TMI 118
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....rned Standing Counsel for the respondents. 2. Impugned order dated 10.04.2019 calling upon the petitioner to remit interest for the belated payment of GST has, admittedly, been passed without a pre-intimation notice/show cause notice. However, without having to set aside the impugned order, it would suffice that a direction be issued to R2, who is the jurisdictional Commissioner, to consider representation dated 28.09.2017 wherein the factual matrix of the matter has been set out in detail. 3. It appears that while seeking to file a return for the month of July, 2017, an error was discovered therein, as a result that the return was merely 'filed' and not 'submitted' and the process was aborted at that stage. According to the petitioner, the output tax liability has been remitted in full into the cash ledger even prior to the 'filing' of the return. The petitioner has been making efforts to correct the error and to obtain opening of the GST portal in order that the corrected return could be filed, to no avail. According to the petitioner, the cascading effect of the aforesaid events have led to the subsequent monthly returns being delayed we....
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....he return for July 2017. 7. The remittance of taxes for the subsequent periods are admittedly belated, and the period of delay and consequent levy of interest, are as tabulated below: Tax Period Date of e-challans Due date to pay tax and file returns Date of payment Delay in filing of Monthly Return (number of days) July 2017 19.08.2017 25.08.2017 20.09.2017 26 July 2017 19.08.2017 25.08.2017 19.07.2019 693 August 2017 18.09.2017 20.09.2017 14.12.2017 85 Sep 2017 16.10.2017 20.10.2017 20.12.2017 61 Oct 2017 16.11.2017 20.11.2017 20.12.2017 30 8.The specific argument of the petitioner is that it had sufficient ITC credit in both the electronic cash ledger ('ECR') as well as the electronic credit register ('ECrC'). Thus, there had been no loss caused to the revenue and hence no justification to levy interest since the interest is only compensatory in nature. 9. Taking note of the amendments to Section 50 of the Act, the respondent has recomputed the interest payable reducing the same from Rs.5,00,00,000/- (approx.) to an amount of Rs.1,19,00,000/-. Thus, credit to the extent of cash pay....
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....egally sustainable, because under the Goods and Service Tax, having sufficient balance of ITC in the Electronic Credit Ledger is immaterial unless the Return is filed and the same is debited towards payment of GST. To be precise, the system of Electronic Credit and Cash ledgers is maintained electronically in the Common portal operated by the GST Network. The tax payment happens only when the statutory Returns are filed and the two ledgers are debited towards the tax liability. Hence any kind of tax payment is final only when the Returns are electronically filed in the Common portal and the actual tax liability is debited in the 'Electronic Credit/ Cash Ledgers' and the GST Registrant cannot claim that the tax was debited in their books of accounts, when as admitted, the filing of proper Return was delayed. 4.2.2.The GST Registrant stated that they generated e-challans for payment of tax. It is submitted that when the GST Registrant generates e-challan, the amount will be credited to the 'Electronic Cash Ledger'. Whatever the balance available in the 'Electronic Cash Ledger', the same is the property of the GST Registrant and it is apposite to mention that they can claim r....
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....e paid belatedly as worked out in Table B below. Since the payment was not made on or before the due date, the GST Registrant shall be liable for payment of interest on delayed payment of tax starting from 26th day of August, 2017 till the date of debit in the electronic cash ledger on filing of Return. INTEREST CALCULATION ON DELAYED CASH PAYMENTS UNDER RCM Tax Period IGST CGST SGST Total Due date to pay tax Date of payment No.of days delayed Interest Payable (a) (b) (c) (d) (e) (k) (l) (m) (n) Jul-17 2,09,252 6,752, 6,752 2,22,756 25.08.17 20.09.2017 26 2,856 Jul-17 65,80,578 1,01,726 1,01,726 67,84,030 25.08.17 19.07.2019 693 23,18,465 Aug-17 18,36,76,200 4,83,127 4,83,127 18,46,42,454 20.09.17 14.12.2017 85 77,39,807 Sep-17 5,38,91,358 12,17,481 12,17,481 5,63,26,320 20.10.17 20.12.2017 61 16,94,419 Oct-17 83,45,296 7,82,906 7,82,906 99,11,108 20.11.17 20.12.2017 30 1,46,630 Total 25,27,02,684 25,91,992 25,91,992 25,78,86,668 1,19,02,178 T....
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.... 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, shall be levied on that portion of the tax that is paid by debiting the electronic cash ledger.' 16. That apart, there is some force to the submissions of the respondents that credit cannot, prior to availment be taken to construe the payment . There are any number of situations where credit may be found to have been availed erroneously or on a mistaken interpretation of law. Thus, it would be risky, from the view-point of the revenue, to state as a general proposition that the mere availability of electronic credit should be assumed to be utilization that would insulate the petitioner from the levy of interest. Thus, unless an assessee actually files a return and debits the respective registers, the authorities cannot be expected to assume that available credits will be set-off against tax liability. 17. Learned counsel for the petitioner relies upon a judgment of the Hon'ble Supreme Court in the case of Union of India Vs Bharti Airtel Limited & Ors (2021 (11) TMI 109- SC). The aforesaid judgment had been rendered in the co....