Goods and Services Tax

Interest rates under CGST Act.

Goods and Services Tax – Started By: – Alkesh Jani – Dated:- 17-7-2018 Last Replied Date:- 21-7-2018 – Sir, In terms of Section 50 (3) of CGST Act, If ITC is wrongly taken or utilized, on reversal interest @ 24% is to be paid. However, if refund is delayed for more than 60 days, interest rate @6% will be paid in terms of Section 54(12) of CGST Act, 2017. Moreover, in terms of Section 2(84) of CGST Act, 2017, person includes Central Government or State Government. The query is :- Section 54(12) of the Act, can be held to be ultra vires to Article 14 of Constitution of India. Thanks – Reply By YAGAY and SUN – The Reply = In our view it is not ultra vires to Article 14 as higher rate of interest as charged by Government works as deterance and

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he nature of contravention. Govt. is a 'Ruler' and an assessee is a 'Ruled' as per Constitution of India. Nicely explained/ replied by both experts. I agree with the views of both experts. If Central Govt. or State Govt. is a taxable person, that Govt. will also get interest @ 6% on the delayed refund. If we peruse decisions of various Courts, penal interest is also imposed on Central Govt. and State Govt., if contravened any provision of Act.Hence question of 'ultra vires' of Article 14 of the Constitution does not arise. All persons are equal in the eyes of law. – Reply By Alkesh Jani – The Reply = Sir,I appreciate the views expressed by our experts, as stated by M/s. Yagay and Sun, that it is to force the assessee

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is like imposing penalty. Even money lenders are abid by the rate of 18%, then why 24% for taxpayers.We are in Independent India, these kind of rate of interest and taxes were levied during British Rule. If Govt. is for the people, why not to keep 24 % instead of 6% for delayed refund.I also acknowledge the views expressed by Sh. Rajagopalan Ranganathan Sir, with request that 24% is 4 times higher than delayed refund rate of 6%, without any doubt, it is undue hardship to any taxpayers or any citizen. Here, we are to keep in our mind the business man having turnover of just more than 20 or 10 lakhs, as the case may be. Please re-offer your comments.Thanks – Reply By KASTURI SETHI – The Reply = Sh.Alkesh Jani Ji,We can raise voice only in the

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