Authority: High Court of Judicature at Madras
Order Date: 01-10-2026
Case Overview
- Parties: Jayashree Enterprises (appellant), represented by Kumaravel Kanagaraju, versus Assistant Commissioner (ST) Udumalpet South Assessment Circle, Tiruppur (respondent).
- Original assessment order dated 12.02.2025 under the Central Goods and Services Tax Act, 2017 was challenged; the writ petition was dismissed on 17.06.2026.
- The dispute centered on the calculation of Input Tax Credit (ITC) interest under Section 50(3) of the CGST Act read with Rule 88B(3) of the CGST Rules.
- Appellant submitted a revised computation: Interest = Rs 48,643 (wrongly availed ITC) × 24% × 437 days / 365 = Rs 13,977.
- Dates used: Utilisation of wrongly availed credit on 14‑08‑2023; reversal on 24‑10‑2024 (total 437 days).
- The assessing authority, in proceedings RC.354/2025/A1 dated 28.09.2026, verified the appellant’s figures and confirmed:
1. Base amount of Rs 48,643 correctly reflects wrongly availed ITC.
2. Utilisation and reversal dates match department records.
3. Computation of Rs 13,977 is mathematically accurate per Rule 88B(3).
- An inadvertent error in the original assessment was identified: interest had been calculated from an earlier date rather than the actual utilisation date.
- Revised liability details:
- Tax: Rs 10,000
- Interest: Rs 13,977
- Penalty: Rs 10,000
- Total payable: Rs 33,977
Final Outcome
- The Court directs the Assessing Authority to modify the assessment order to reflect the revised interest liability of Rs 13,977 (and associated tax and penalty) within one week of the order.
- The appellant is granted liberty to raise any further issue by filing a statutory appeal or revision within two weeks, subject to statutory conditions.
- No costs are awarded to either party.
- The writ appeal and the connected miscellaneous petition are hereby closed.
Topics: CGST, Interest Calculation