Tvl. Sai Cashew Processors Vs Deputy State Tax Officer (Madras High Court)
The writ petition challenges an order dated 13.03.2025 passed pursuant to a remand by the Madras High Court on 16.08.2024. The earlier remand directed the respondent to pass a fresh order subject to the petitioner depositing 10% of the disputed tax. The petitioner had originally challenged three separate orders dated 31.07.2023, 14.12.2023, and 22.12.2023.
Following the remand, the petitioner paid ₹2,88,181 on 21.11.2024 and an additional ₹77,201 on 16.10.2024. The impugned order recorded total payments of ₹3,65,382 and noted an excess payment of ₹1,73,365, though part of the payment was disregarded. The tax demand arose from defects including mismatch between GSTR-3B and GSTR-1, under-reporting of turnover, and non-payment of tax on certain charges.
The impugned order also levied interest of ₹2,34,639 under Section 50(1) of the GST Act, 2017, along with penalty. The petitioner contended that the excess payment should have been adjusted against the interest and penalty.
The Court observed that since the petitioner admitted tax liability, interest on delayed payment was payable. However, it held that there was no justification for imposing penalty under Section 73 of the GST Act, 2017. The Court also noted doubts regarding the correctness of the interest calculation.
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