Tag: Interest and Penalty

Excess ITC already reversed and Interest Paid – Order demanding Interest and Penalty Set aside and treated as SCN

Citation:

K.C. & Sons vs. Deputy Commissioner (ST), GST Appeal

High Court of Madras

[2025] 171 taxmann.com 31 (Madras)[20-12-2024]

Facts of the Case:

  1. There was a mismatch between GSTR3B and GSTR2A, for FY 2017-18.
  2. DRC-01A was issued on 2nd May 2023 and DRC-01 was issued on 10th May, communicating the date of Personal Hearing as 21st June 2023.
  3. Reply was filed on 9th May 2023 and Order confirmig the demand, was passed on 7th December.

Submissions of the Petitioner:

The difference being the excess ITC, was already reversed in 2019, whereas the Order propose to levy Interest and Penalty and also that a portion fo the interest demanded, has already been paid.

Held that:

  1. Given that the petitioner has already reversed the excess credit, one final ooportunity for personal hearing shall be granted.
  2. The impugned Order is Set Aside and shall be treated as Show Cause Notice.
  3. The petitioner shall file their objections within four weeks from the date of receipt of the order and the department shall consider the same and pass appropriate order, after providing an opportunity of Personal Hearing.