Case Law Details
Console Shipping Services India Pvt. Ltd. Vs Union of India Through Secretary (Delhi High Court)
Introduction: In the case of Console Shipping Services India Pvt. Ltd. versus Union of India Through Secretary, the Delhi High Court addressed a petition seeking permission to carry forward Central Value Added Tax (CENVAT) credit and interest paid in Electronic Credit Ledger under GST. The judgment provided relief to Console Shipping Services India regarding the demand for interest.
Detailed Analysis:
1. Petitioner’s Request: Console Shipping Services India Pvt. Ltd. filed a petition seeking direction from the respondents to allow the carry forward of Rs. 13,94,961/- of CENVAT credit along with Rs. 8,98,763/- as interest paid in Electronic Credit Ledger under GST through GST 3B return.
2. Granted CENVAT Credit: During the pendency of the petition, the petitioner was granted CENVAT credit of Rs. 10,36,932, while the input tax credit of the remaining balance amount was rejected.
3. Remaining Issue: The only remaining issue pertained to interest on the delay in permitting the carry forward of CENVAT credit on the admitted amount of Rs. 10,36,932/-.
4. Respondents’ Submission: The respondents argued that the carry forward occurred during the transitional period and migration of existing taxpayers under Section 140 of the Central Goods and Services Tax Act, 2017. They stated that there is no automatic provision for interest payment on delayed refunds under Section 56 of the Act. However, they assured that upon application by the petitioner, the Department would consider granting interest as per the law.
5. Court’s Decision: Instead of requiring the petitioner to file a separate application, the court disposed of the petition with a direction to treat it as a representation regarding the grant of interest on the delayed carry forward of CENVAT credit. The respondents were instructed to pass a speaking order within four weeks, allowing the petitioner to pursue further legal remedies if dissatisfied with the order.
Conclusion: The Delhi High Court’s judgment in the case of Console Shipping Services India Pvt. Ltd. versus Union of India Through Secretary provides relief by directing the respondents to consider granting interest on the delayed carry forward of CENVAT credit. This decision highlights the importance of procedural fairness and legal remedies in matters related to GST credit and tax refunds.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
Petitioner had filed the subject petition seeking a direction to the respondents to permit the petitioner to carry forward an amount of Rs.13,94,961/- of Central Value Added Tax (CENVAT for short) CENVAT credit plus a sum of Rs.8,98,763/- as interest paid in Electronic Credit Ledger maintained under GST through GST 3B return.
2. Learned counsel for petitioner submits that during pendency of the present petition, the petitioner has been granted CENVAT credit of 10,36,932 and Input Tax Credit of the balance amount of Rs. 3,57,477/- has been rejected.
3. Learned counsel for petitioner submits that the only issue remaining is with regard to interest on the delay in permitting carry forward of CENVAT credit on the admitted amount of Rs.10,36,932/-.
4. Learned counsel for respondents submits that the subject carry forward was during the transitional period and migration of existing tax payers in terms of Section 140 of the Central Goods and Services Tax Act, 2017. He submits that there is no automatic payment of interest as is stipulated under Section 56 of the Act on delay refunds. He submits that in case an application is filed by the petitioner, the Department shall pass an appropriate order on the question of grant of interest in accordance with law.
5. Instead of relegating the petitioner to filing an application, we dispose of this petition with a direction to the respondents to treat this petition as a representation with regard to grant of interest on the alleged delayed carry forward of the CENVAT credit in accordance with law.
6. A speaking order be passed by the respondents within a period of four weeks from today. It will be open to the petitioner to take such further remedy as may be permissible in law, in case petitioner is dissatisfied with such an order.
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