Case Details:
Particular | Details |
Case No. | R/Special Civil Application No. 21534 of 2019 |
Case Name | Rajkamal Builder Infrastructure (P.) Ltd. v. Union of India |
Court | Gujarat High Court |
Date of Judgement | 23-03-2021 |
Citation | GIG-CLS-0031 |
Issue- In the above case, the petitioner has challenged the show cause notice issued by respondent authority for the purpose of recovery of the interest payable on delayed payment of tax. Petitioner contented that interest could be only levied on net tax liability and not gross tax liability. Respondent issued show cause notice in the form DRC-01 for the for the purpose of recovery of the interest payable on delayed payment of tax.
Held- It was held that the amendment proposed in section 50 vide clause 103 of the Finance Bill, 2021, state that interest under section 50 can only be levied on net tax liability and not on gross tax liability. In such circumstances, the demand raised by the Competent Authority is not in accordance with law. Also, we do not find reference of any notice under section 50 so far as Rule 142(1)(a) of the CGST Rules is concerned. In such circumstances, DRC 01 could not have been issued for the purpose of recovery of the amount towards interest on delayed payment of tax. therefore, the writ application succeeded and was allowed. The impugned order issued in GST DRC 01 was ordered to be quashed and set aside.