Alamelu Construction Vs Assistant Commissioner of GST & Central Excise (Madras High Court)
The case of Alamelu Construction Vs Assistant Commissioner of GST & Central Excise, heard by the Madras High Court, revolves around the imposition of penalties despite the discharge of GST liabilities.
The petitioner in this case had discharged their GST liability before the issuance of the show cause notice. Despite this, the impugned order imposed both interest and penalty. The petitioner argued for the applicability of the proviso to Section 50(1) of the Central Goods and Services Tax Act, 2017, which would exempt them from paying interest due to the pre-discharge of tax liability.
However, the respondent argued that the petitioner had collected taxes but failed to remit them on time. They contended that since the liability was discharged after the commencement of proceedings, the proviso to Section 50(1) could not be invoked.
The Madras High Court observed that while the petitioner did discharge their GST liability, the imposition of a 100% penalty warranted reconsideration. Considering the circumstances, the court allowed the petitioner to file a statutory appeal, subject to the condition that the petitioner remits a sum of Rs.2.5 lakhs (Rupees two lakhs fifty thousand only) towards interest liability as agreed to within a period of three weeks from the date of receipt of a copy of this order..
