Jitu Enterprises And Sounds Service Vs Union of India (Gauhati High Court)
Jitu Enterprises and Sounds Service, a partnership firm engaged in housekeeping services and registered under the CGST Act, 2017, faced a legal challenge regarding discrepancies in their tax returns for the 2018-2019 period. Authorities identified late filing of returns and non-payment of interest on delayed tax payments under Sections 47 and 50 of the CGST Act. The firm was initially notified of a late fee of Rs. 1,13,850 and interest of Rs. 38,55,335 for the 2018-2019 period. Subsequently, a more comprehensive notice in Form GST DRC 01A highlighted ineligible input tax credit and further interest on delayed tax payments, amounting to Rs. 8,79,904 in tax and Rs. 96,06,286 in interest for the period spanning April 2018 to March 2022. The firm had previously deposited Rs. 19,00,000, leaving an outstanding interest liability of Rs. 1,05,06,286.
In response to these demands, Jitu Enterprises requested permission to pay the outstanding amount in forty-eight equal monthly installments. This request was denied by the tax authorities, who cited Section 80 of the CGST Act, which limits installment payments to a maximum of twenty-four, and specifically excludes amounts arising from self-assessed liability in returns from installment payment. The Gauhati High Court, in reviewing the writ petition filed by Jitu Enterprises, upheld the authorities’ decision, stating that neither the tax authorities nor the Court can act contrary to the statutory provisions of Section 80. The Court clarified that mandamus would not be issued to compel actions in contravention of the statute. However, recognizing the firm’s willingness to comply within statutory limits, the Court granted Jitu Enterprises leave to file a fresh application within three weeks, requesting payment in twenty-four equal monthly installments as permissible under Section 80 of the CGST Act and Rule 158 of the CGST Rules, 2017. The Commissioner is directed to consider this new application expeditiously, ideally within one month, and provide a personal hearing.
FULL TEXT OF THE JUDGMENT/ORDER OF GAUHATI HIGH COURT
