Assessing Officers to do Adjudication Proceedings Before GST Interest: JH HC

Jharkhand High Court on Tuesday gave its verdict saying that though the interest liability under section 5 of the Central Goods and Service Tax (CGST) 2017 is computed automatically, the same shall be levied only after the completion of the adjudication proceedings valid under CGST Act 2017.

The applicant of the case is a partnership firm that was charged for not filing GSTR 3B. GSTR 3B is an auto-populated form that is loaded with information based on the inward and outward supply data. Due to the functional issues in GSTN Portal Read out the complete guide of official GST return filing portal i.e. GSTN for Indian taxpayers. We explain all the important part with the brief introduction. Read more, the applicant’s GSTR 3B form was not generated. This led to a stop-gap arrangement in the provisions related to the filing of GSTR 3B Returns under Rule 61(5) and Rule 61(6) of the CGST Act 2017.

On the other hand, the respondent i.e. The Superintendent of Goods and Service Tax and Central Excise via a written notice demanded the interest from the petitioner on account of delay in filing GSTR 3B return for February and March 2018. Authorities are empowered under section 79 of the CGST Act 2017 for recovering the interest amount by sending the written notice to the petitioner’s Banker. Banker being the Third-party has to reply to the notice of the concerned authorities under ‘garnishee proceedings’.

Offended by the actions of the respondent, the petitioner reached out to Jharkhand High Court seeking relief from the said interest liability demanded by the way of an impugned notice on account of delay in filing GSTR 3B for the month of February and March 2018. The notice is not valid in the eyes of the law as it has been sent to the applicant party without any prior jurisdiction proceedings as mandated under section 73 and 74 of the CGST Act, 2017. Adding on to this, the applicant said that they are no way liable to pay the interest as there is no delay from their end in submitting form GSTR 3B returns GST council decided GSTR 3B filing until March 2019 in the 27th meeting. We researched and published some interesting points that why Indian government extended GSTR 3B every time?., and simultaneously there is no delay from there end in submitting the tax payment for Feb and March 2018. The due date for filing GSTR 3B for the months of February and March 2018 was 31 March 2019.

Jharkhand HC jury panel consisting of Justice Deepak Roshan and Justice HC Mishra concluded the case giving their verdict “The interest under section 50 of CGST Act is needed to be calculated and then intimidated to the assessee and if the interest amount or even its leviability if questioned by the assessee then it is the duty of the concerned assessing officer to carry on with the proceedings under section 73 or 74 of the CGST Act 2017 for the liability of GST Interest‘.

While canceling the letter of recovery, the jury panel stated that ‘though the computation of interest is for the delay in filing GSTR 3B is automatic the same needs to be thoroughly investigated by the assessing officer under section 73 and 74 of the CGST Act. Until the proper results of the adjudication proceedings are driven, the interest amount shall not be termed as the payable amount under the CGST Act 2017. The conclusion driven for such a case is until the adjudication proceedings end and proper results are driven by the concerned authorities no recovery of interest under section 79 of the Central GST Act Get the brief introduction of SGST, IGST and CGST. We have mentioned their full forms, meanings and adjustments of input tax credit under GST in India. Read More shall be done under.