Kalanther Madeena Textiles Vs Deputy Commissioner (CT) (Madras High Court)
In Kalanther Madeena Textiles Vs Deputy Commissioner (CT), the Madras High Court examined the legality of imposing both general penalty under Section 125 and late fee under Section 47 of the GST enactments for failure to file annual returns (GSTR-9/GSTR-9C) for FY 2018–19. The petitioner had neither filed the annual return within the prescribed period nor responded to the show cause notice issued prior to the impugned order. Consequently, an order was passed imposing both late fee and general penalty.
During the hearing, both parties agreed that the issue was covered by a prior judgment of the same Court in Kandan Hardware Mart. In that decision, the Court had held that once a late fee is levied under Section 47, which is penal in nature, there is no scope for additionally imposing a general penalty under Section 125. The Court reasoned that general penalty can be invoked only in the absence of any other penalty, and simultaneous imposition would be unjustified.
Applying the same reasoning, the Court held that the imposition of general penalty in the present case was not sustainable. Accordingly, the writ petition was partly allowed, and the general penalty under Section 125 was set aside. However, the petitioner was directed to pay the late fee imposed under Section 47(2) within 30 days.
