Page 99 - GSTL_21st May 2020_Vol 36_Part 3

2020 ] MAHADEO CONSTUCTION CO. v. UNION OF INDIA 345
titioner’s Banker. Said initiation of garnishee proceedings under Section 79 of the
CGST Act is also impugned in the present writ application.
6. Mr. Sumeet Gadodia, Learned Counsel appearing for the petitioner
has vehemently submitted that the impugned letter dated 8-3-2019 issued by re-
spondent No. 3 demanding interest amount of Rs. 19,59,721/- on the alleged
ground of delay in submitting GSTR-3B Return for the months of February and
March, 2018, is not sustainable in the eyes of law, as the said amount of interest
has been determined without initiating any adjudication process under Section
73 or 74 of the CGST Act. It is the specific case of the petitioner that the petitioner
is not liable to pay interest as there has been no delay on its part in furnishing of
GSTR-3B Return and, consequentially, there is no delay on its part in depositing
the tax with the respondent-Authority, as in GSTN Portal, due date for furnish-
ing of return for the months of February and March, 2018 was shown as 31st
March, 2019.
7. It has been further argued by Mr. Gadodia that if the amount of in-
terest is not admitted by an assessee, the same requires determination through an
adjudication process to be initiated as per the detailed provisions contained un-
der Section 73 of the CGST Act.
8. It has been further submitted by the Learned Counsel for the peti-
tioner that not only that respondent-Authorities, without initiating adjudication
process, have straightaway demanded interest from the petitioner, but they have,
in a most arbitrary and illegal manner, by adopting extra legal steps, initiated
garnishee proceedings under Section 79 of the CGST Act for recovery of the
amount of interest. It has been contended that provisions of Section 79 of the
CGST Act can be adopted only when “any amount payable by a person to the
Government under the provisions of the Act and the Rules is not paid”. It has
been submitted that the words “any amount payable” is to be interpreted in the
context in which it has been used and the amount payable (unless admitted) can
only be determined by initiating adjudication process as provided under Section
73 or 74 of the CGST Act. It is the specific case of the petitioner that since the peti-
tioner has not admitted its liability of interest, the said interest liability to be clas-
sified as an amount payable under the Act and/or Rules, necessarily requires
adjudication process and, in absence thereof, initiation of garnishee proceedings
is not sustainable in the eyes of law and even amounts to taking extra legal steps
for recovery of the amount from an assessee.
9. Per contra, Mr. Ratnesh Kumar, Learned Counsel for the respondent
submitted that the present dispute pertains to recovery of interest not on the
ground of delay in filing of GSTR-3B Return, but on the ground of delayed pay-
ment of tax beyond the stipulated date as prescribed under Section 39(1) read
with Section 39(7) of the CGST Act. It is the case of the revenue that once there is
a delay in payment of tax, the liability to pay interest on the same becomes au-
tomatic, for which no separate proceedings is required to be initiated for deter-
mining such interest liability.
10. It has been further submitted by Learned Counsel of the respondent
that it is an admitted case of default in filing self-assessed monthly state-
ment/return within the statutory period and payment of admitted self-assessed
tax, which consequentially attracts payment of interest under Section 50 of the
CGST Act. In other words, it has been contended that payment of interest as en-
visaged under Section 50 of the Act is automatic and is to be paid by the default-
er at his own without initiating any adjudication process under Section 73 or 74
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