Patna High Court
Prema Automobiles Pvt. Ltd vs The State Of Bihar on 10 February, 2021
Bench: Chief Justice, S. Kumar
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.5816 of 2020
======================================================
Prema Automobiles Pvt. Ltd. having its registered Office at Bindbasini
Bhawan, Ground Floor, Post Office Lane at Exhibition Road, Patna through
one of Its Directors Namely Ribhu Kumar Male aged about42 Years Son of
Krishna Murari Pansari, House No.4, Yugal Kunj, Road No. 16, Rajiv Nagar,
Patna-800024.
... ... Petitioner/s
Versus
1. The State of Bihar through the Principal Secretary Cum Commissioner,
Department of State Taxes, Government of Bihar, Patna.
2. The Joint Commissioner of State Taxes, Patna North Circle, Patna.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr. Gautam Kumar Kejriwal, Advocate
For the Respondent/s : Mr. Vikash Kumar, SC 11
======================================================
CORAM: HONOURABLE THE CHIEF JUSTICE
and
HONOURABLE MR. JUSTICE S. KUMAR
ORAL JUDGMENT
(Per: HONOURABLE THE CHIEF JUSTICE)
Date : 10-02-2021
Petitioner has prayed for the following relief(s):-
"a) For issuance of writ or order in the nature of
certiorari for quashing of the order number
ZA100220024511P dated 23.02.2020 passed by the
respondent number 2 under Section 75(12) read with
Section 50(2) of the the Bihar Goods and Services Tax
Act, 2017 (hereinafter referred to as the Act for short),
and the consequential demand notice/summary of order
issued in form GST DRC-07 dated 23.02.2020 being ex
parte and as such violative of the principles of natural
justice;
b) For holding and a declaration that the impugned
Patna High Court CWJC No.5816 of 2020 dt.10-02-2021
2/4
order number ZA100220024511P dated 23.02.2020 and
the consequential demand notice is wholly without
jurisdiction and is unsustainable in the eye of law;
c) For further holding and a declaration that in absence of
the jurisdictional fact necessary for exercise of power
under Section 50 read with Section 75(12) of the Act the
respondent assessing authority could not have passed the
impugned order and the consequential demand notice
which is accordingly without jurisdiction and liable to be
quashed by this Hon'ble Court;
d) For further holding and a declaration that the case of
the petitioner is squarely covered by the judgment dated
06.01.2020of Hon'ble Madras High Court in the matter of Refex Industries limited Vs. Asst. Commissioner of CGST and Central Excise wherein it has been held that the liability of interest under Section 50 of the Act would be attracted only in case of the tax liability discharged from out of the cash ledger;
e) For further holding and a declaration that no liability of interest would be attracted in the case of the petitioner when the credit balance existing in the electronic credit ledger of the petitioner is quite surplus to meet the tax liabilities admitted by the petitioner in the returns filed for the respective months;
f) For further holding and a declaration that in case the petitioner has already furnished the return and made payment of tax liabilities in terms of section 39(7) of the Act, no liability of interest would be attracted in terms of Section 75(12) of the Act;
g) For grant of any other relief or reliefs to which the petitioner is found entitled in the facts and circumstances of this case."
In view of the stand taken by the State vide its affidavit dated 11.01.2021 affirmed by Shri Gautam Kumar Kejriwal, learned counsel for the petitioner, we close the present proceedings taking on record the averments made by the deponent, part of which are reproduced as under:
"14. That post issuance of Notification No.- 63/2020 dated 25th August, 2020 by the central government a press release was issued by Ministry of Finance, Govt of India on 26-08-2020 wherein it was clarified that amendment in section - 50(1) has been made effective prospectively w.e.f Patna High Court CWJC No.5816 of 2020 dt.10-02-2021 3/4 01-09-2020 due to certain technical limitations, however no recoveries for interest charged on gross liability will be recovered for the past period as well by the central and state tax administration.
15. That in the light of aforesaid submissions, it is stated that in the present scenario, no recovery will be made for interest charged on delayed payment of tax which has been made by the taxpayer debiting the credit ledger, however, in terms of amended section- 50(1), it is prayed before the Hon'ble Court that the taxpayer may be directed to pay the interest on delayed payment of tax which has been made by debiting the cash ledger that is interest payable on net liability."
Additionally, our attention is invited to the circular issued by the Central Board of Indirect Taxes & Customs (CBIC), which reads as under:-
"Interest on delayed payment of GST:CBIC Posted on 26th August 2020 5:34 PM by PIB Delhi Central Board of Indirect Taxes & Customs (CBIC) today clarified that the Notification No. 63/2020-Central Tax dated 25th August 2020 relating to interest on delayed payment of GST has been issued prospectively due to certain technical limitations. However, it has assured that no recoveries shall be made for the past period as well by the Central and State tax administration in accordance with the decision taken in the 39th Meeting of GST Council. This will ensure full relief to the taxpayers as decided by the GST Council.
CBIC explanation came in response to an assortment of comments in the social media with respect to notification dated 25th August 2020 regarding charging of interest on delayed payment of Patna High Court CWJC No.5816 of 2020 dt.10-02-2021 4/4 GST on net liability (the tax liability discharged in cash) w.e.f. 1st September 2020."
As such, the petition is disposed of in the aforesaid terms.
(Sanjay Karol, CJ) ( S. Kumar, J) Sanjay/-
AFR/NAFR NAFR CAV DATE NA Uploading Date 12.02.2021 Transmission Date NA