GST--Interest

Assessee Became Entitled for Refund Pursuant to Appellate Order--Relevant Date for Calculation of Interest

D. Ramachandra Rao

The learned author seeks to analyse the issue as to whether what would be the relevant date for calculation of interest where assessee becomes entitled for refund in pursuance of the appellate order. The related issue is being discussed in the light of a Telangana High Court decision in the case of Qualcom India (P) Ltd. v. Dy. CST & Ors. decided on 20-3-2024.

1. Interest on delayed refunds

Section 56 of the Central Goods and Services Tax Act, 2017 (in short "the CGST Act"), deals with the provisions relating to interest on delayed refunds. Accordingly, if any tax ordered to be refunded under sub-section (5) of section 54 to any applicant is not refunded within sixty days from the date of receipt of application under sub-section (1) of that section, interest at such rate not exceeding six per cent. as may be specified in the notification issued by the Government on the recommendations of the Council shall be payable in respect of such refund for the period of delay beyond sixty days from the date of receipt of such application till the date of refund of such tax, to be computed in such manner and subject to such conditions and restrictions as may be prescribed.