Swift Motors Vs Superintendent, Central Tax
Date: January 16, 2024
Subject Matter
Retrospective amendments to Section 50 necessitates the reevaluation of the interest demand
Summary
The Rajasthan High Court presided over a dispute between Swift Motors and the Superintendent of Central Goods and Service Tax involving a substantial interest demand of INR 22,94,722 made to Swift Motors based on the original provisions of Section 50 of the Central Goods and Service Tax Act, 2017. However, subsequent retrospective amendments to Section 50 necessitated the reevaluation of the interest demand. The court acknowledged the impact of the legislative changes on Section 50, thereby directing the reevaluation of the demand under the amended provisions, potentially alleviating Swift Motors' financial burden.
FULL TEXT OF THE JUDGMENT/ORDER OF RAJASTHAN HIGH COURT
1. This writ petition has been filed by the petitioner aggrieved of the Notice dated 13.08.20 19 (Annex.1), whereby the petitioner has been called upon to deposit interest amounting to 22,94,722/- within a period of three days.
2. The said notice was issued to the petitioner pursuant to the original notice dated 11.09.2018 (Annex.R/2), inter-alia, indicating the grounds and calculation, on which the demand was raised under Section 50 of the Central Goods and Service Tax Act, 2017 (‘the Act’).
3. During pendency of the petition, the provisions of Section 50 of the Act of 2017 have undergone change by the Finance Act, 2019, whereby proviso to Section 50 was inserted vide Section 100 of the said Finance Act, 2019. Whereafter, further amendment has taken place by the Finance Act, 2021, wherein by Section 112 of the said Finance Act, 2021, proviso has been given a retrospective effect and has been made applicable w.e.f. 01.07.2017.
4. Learned counsel for the petitioner made submissions that in view of the retrospective amendment to Section 50 of the Act, the demand raised by the respondents dated 11.09.2018 & 08.2019, requires to be redetermined by them and therefore, the matter be remanded back to the respondents for redetermination of the same.
5. Learned counsel appearing for the respondents does not dispute the fact that the provisions of Section 50 of the Act has undergone changes, which would have implication on the demand raised against the petitioner and that the same is required to be redetermined in terms of the said amended provisions.
6. In view of the above fact situation, the petition filed by the petitioner is disposed of. The petitioner may approach the respondents by way of an appropriate representation indicating the demand, which according to the petitioner, would be payable and seeking redetermination of the demand raised pursuant to the Notices dated 11.09.20 18 & 13.08.20 19 in terms of the amended provisions of Section 50 of the Act, whereby the proviso has been inserted and give retrospective effect.
7. On the petitioner approaching the respondents by way of such a representation, the respondents shall redetermine the interest payable by the petitioner as per the amended provisions and take steps in accordance with law.
8. As for non-payment of the demand raised, the Bank account of the petitioner has been attached, it would be required of the petitioner to make payment of the payable amount as indicated by him in the representation, on such payment, the attachment of the bank account of the petitioner shall be lifted by the
9. However, the said payment would remain subject to the final determination to be made by the respondents and they would be free to enforce the balance demand in accordance with law.