Union Of India VS LC Infra Projects Pvt. Ltd

The summary begins with the permission granted to the appellant’s counsel to present arguments for the condonation of delay. This sets the stage for the legal proceedings that follow.

The case, as presented before the learned Single Judge, involved a twofold challenge. The first aspect of the challenge was directed towards a notice of demand dated March 4, 2019, which is annexed as ‘Annexure-J’ to the writ petition. This notice pertained to the demand for interest as per subsection (1) of Section 50 of the Central Goods and Services Tax Act 2017 (GST Act). The challenge likely centered around disputing the validity or legality of this demand for interest.

The mention of the Central Goods and Services Tax Act 2017 indicates that the case revolves around tax matters, particularly related to goods and services. The demand for interest under Section 50 of this Act suggests that there might have been a delay or discrepancy in the payment of taxes, leading to the imposition of interest by the tax authorities.

The appellant’s counsel appears to argue for the condonation of delay, implying that there was some delay in complying with certain legal requirements or procedural formalities, and they seek the court’s leniency or understanding in this regard.

Overall, the summary provides a glimpse into the legal intricacies and procedural aspects of the case, with specific focus on the challenge to a notice of demand under the GST Act and the plea for condonation of delay.

The case in question involves an appellant seeking condonation of delay, arguing before a learned counsel. Initially, the challenge revolved around a notice of demand dated March 4, 2019, under Section 50 of the Central Goods and Service Tax Act 2017 (GST Act), which demanded interest. Subsequently, on March 7, 2019, the tax authorities took further action, attaching the respondent-assessee’s account due to non-payment of interest, forming the second challenge in the writ petition.

Upon examining the impugned order, it was noted that the appellant’s counsel conceded before the learned Single Judge that no notice under Section 73 of the GST Act had been issued to the respondent-assessee before quantifying the interest amount and attaching their bank account. The learned Single Judge held that the issuance of a show-cause notice is essential for proceeding with the recovery of interest and penalties under the GST Act and its rules. The absence of such notice was deemed a breach of natural justice, leading to the quashing of both the orders mentioned.

In essence, the appellant argued for the condonation of delay while the respondent contested the validity of the notice of demand and subsequent actions taken by the tax authorities. The crux of the matter lies in the procedural irregularities concerning the issuance of notices and the adherence to principles of natural justice.

The case revolves around a challenge to a notice of demand dated March 4, 2019, regarding interest under Section 50 of the Central Goods and Service Tax Act, 2017 (GST Act), and the consequential attachment of the respondent-assessee’s bank account due to non-payment of interest. The appellant’s counsel argued for condonation of delay.

Before a learned Single Judge, the challenge encompassed two main points. Firstly, it contested the notice of demand issued on March 4, 2019, and secondly, it challenged the subsequent attachment of the respondent-assessee’s account on March 7, 2019. The crux of the issue lay in the absence of a show cause notice as required by Section 73 of the GST Act before quantifying the interest amount and attaching the bank account.

The impugned order indicated that the appellant’s counsel had acknowledged before the Single Judge that no show cause notice was issued to the respondent-assessee before quantifying the interest amount and attaching the bank account. The Single Judge held that the issuance of a show cause notice is essential before proceeding with the recovery of interest under Section 50 of the GST Act and levying penalties. It was deemed a breach of natural justice for the interest amount to be determined without issuing a show cause notice. Consequently, both the orders regarding the notice of demand and the attachment of the bank account were quashed by the Single Judge, with the third respondent (Authority) being given liberty to proceed in accordance with the law.

The appellant’s counsel, in arguing their case, highlighted Section 50(1) of the GST Act and the demand made in Annexure-J. They contended that the interest demand was due to belated payment of tax as per self-assessment. Thus, they argued that since the tax was payable based on self-assessment, issuing a show cause notice was unnecessary, as the demand pertained solely to interest under Section 50(1) of the GST Act. They further argued that since the demand was only for interest and not tax, a notice under Section 73(1) of the GST Act was not necessary. They emphasized that the attachment of the bank account was a consequence of failing to pay interest and therefore, Annexure-J should not have been deemed illegal due to a breach of natural justice.

In summary, the case involves a dispute over the legality of a notice of demand for interest under the GST Act and the subsequent attachment of a bank account, with the primary contention being the lack of a show cause notice before quantifying the interest amount and attaching the account. The appellant’s counsel argued that issuing a show cause notice was unnecessary as the demand was solely for interest based on self-assessment.

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