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How GST Certification Course Made Me a Better Person

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hazelclare
How GST Certification Course Made Me a Better Person

Section 78(CGST Act) states that any amount due a taxable subject to an order passed must be paid within 3 month of the service of such order. If the payment is not made, then the department shall initiate recovery proceedings.

Section 79 of CGST Act 2017. Governs Tax Recovery. Section 79 explains that if any amount due by a person to Government under any of its provisions and Rules is not paid then the appropriate officer may recover it by one or multiple modes.

Section 79 gives the following options for recovering tax from the proper officer:

  1. The proper officer could recover the amount by deducting it off the other amount due to such person.
  2. A proper officer may seize or sell any goods which are his property.
  3. The proper officer has the power to notify any person that money is due or could become due to them or who holds money for or might subsequently hold money, and to recover it from them to pay the government.
  4. Any movable, immovable, or personal property of a person under their control or custody may be held by the proper officer until payment is made. If the dues are not paid within thirty days, the property is to go on the market and the proceeds will be used to pay the amount and costs of the sale.
  5. The proper officer will prepare a statement stating the amount due and send it on to the collector in the relevant district. Collector shall recover such amount as an arrears of revenue.
  6. The officer in question shall submit a formal application to the Magistrate. They will then proceed with the recovery of the amount as if the amount were a penalty.
  7. Any amount due on any bond, other instrument, executed under this Act and Rules or regulations made thereunder is possible to be recovered.
  8. The proper officer for State tax or Union taxes may recover from any person unpaid amount of tax, interest or penalty that is due to Central Government. This amount will also be returned to Central Government as arrears for SGST/ GST.
  9. If the amount reclaimed exceeds the amount owed, such amount will then be divided between Central Government, State Government & Union Territory in proportion to the amount owed each authority.

Is it possible to recover such amounts in installments? Section 80 of CGST Act addresses this issue. Section 80 allows a taxable person to apply to the Commissioner for extensions to the time of payment or for other reasons that can be recorded in writing. Payments under this Act are to be made by the person in monthly instalments of maximum 24. Interest under section 50 is payable. Other restrictions and conditions may apply.

If any instalment is late or not paid, the entire balance due shall be due and payable at once.

Let us look at the writ letter filed before the High Court, in the Pazhayidom Food Ventures Ltd vs Superintendent Commercial Taxes. In this petition, a request was made for GST certification course dues to be paid in installments.

Facts about this Case
  1. The petitioner represents a private limited business that is registered as an under GST service provider.
  2. The petitioner has stated that while he intends on paying the arrears and tax for the assessment year 2018-19 (November 2018 to March 2019, respectively), without contesting it, the respondents have expressed their inability or inability to allow him pay the arrears and tax in instalments.
  3. The petitioner claimed that because of the COVID epidemic, he was not in the financial position to make a lump amount payment of the admitted taxes for the period.
  4. He asked for a direction from the Court to allow him file the returns without paying the entire admit tax but making sure that the payment, including interest, on the returned, be made before 31st march 2021.
Contention by Respondent

Respondent argued that the Act did no provide for the payment by instalments the amount of the admitted amount in return. The petitioner therefore could not seek relief because of these express provisions.

Observations made by the High Court
  1. HC said that petitioner was not contesting the extent of his tax liability.
  2. It sought an instalment arrangement to pay the admitted taxes and interest in light of the financial difficulties that it faced during the COVID situation.
  3. The petitioner has proved its true identity by making a payment for Rs.4Lakhs towards the tax owed for the period 2018-19.
  4. It was also noted by the court that no payment was made to the petitioner on the unpaid amount of tax.
  5. Given the circumstances, as the petitioner wasn't disputing his liability and wished for the matter to be ended, HC directed that the respondent accepts the late return filed by the petitioner from November 2018 through March 2019, without insisting upon payment of the admit tax.
  6. The respondents were told to adjust the amount Rs. The respondents were instructed to adjust the amount Rs.

It was also pointed out that the petitioner could default in any single installment and lose the benefit. Respondents can pursue recovery proceedings to collect the tax, interest, or other amounts.

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