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Laldeo Rajak-vs-Kanthwal Services, Proprietor-2026-juristway.com-2983-GSTAT(New Delhi)-GST
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2026-juristway.com-2983-GSTAT(New Delhi)-GSTLaldeo Rajak v Kanthwal Services
✓ Good LawDismissed2 Judge Bench
TreatmentNot yet cited by a later judgment
2026-juristway.com-2983-GSTAT(New Delhi)-GST

Laldeo Rajak

versus

Kanthwal Services, Proprietor

Court - Bench
GST Appellate Tribunal (GSTAT) - New Delhi
Date of Judgment
15 October 2026
Judges
Mr. Arun Kumar Singal, Member (Judicial), Mr. Sanjeev Kumar Jain, Member (Technical)
Case Number
APL/79/DEL/2026
Advocate (Petitioner)
Sh. Deepak Kumar Sharma - Assistant Commissioner, Division – Malviya Nagar, CGST Delhi South
Advocate (Respondent)
Sh. Naman Gupta - Advocate
Quick ref
Takeaway

Section 50(1) — Interest Ceases on Credit to Government Account — Not on ECL Debit Date — GSTAT New Delhi upheld the appellate order confirming that interest under Section 50(1) runs only until the date the tax is credited to the Government’s account through PMT-06, not until the later date of debit from the Electronic Cash Ledger on filing of the return, following Arya Cotton Industries, Vishnu Aroma Pouching, Eicher Motors, Symphony Ltd. and Bangalore International Airport; the Department’s appeal was dismissed and the Cross Objection seeking further reduction was also dismissed.

Digest & Analysis
Litigation Digest

In Laldeo Rajak v. Kanthwal Services, Proprietor, 2026-juristway.com-2983-GSTAT(New Delhi)-GST, where the Department appealed the OIA which had reduced the interest liability for FY 2017-18 from Rs. 73,95,561 to Rs. 40,47,151 by computing interest only to the date of challan credit rather than the date of return filing, and the respondent cross-objected seeking further reduction and deletion of penalty of Rs. 45,829, the Tribunal held on Issue I that the tax demand of Rs. 4,58,289 was correctly set aside since DRC-03 was filed before the OIO was passed; on Issue II that interest under Section 50(1) ceases to run once tax stands credited to the Government’s account through PMT-06, following Arya Cotton Industries (Gujarat HC), Eicher Motors (Madras HC), Vishnu Aroma Pouching (Gujarat HC), Symphony Ltd. (Gujarat HC) and Bangalore International Airport (Karnataka HC); on Issue III that the balance interest of Rs. 25,47,151 (after crediting Rs. 15,00,000 already paid) was correctly quantified; and on Issue IV that the penalty of Rs. 45,829 was rightly imposed since payment was made outside the Section 73(8) thirty-day window. Both the Department’s appeal and the Cross Objection were dismissed.

✎ Editor's Note

This detailed order consolidates and applies the now-established line of High Court authority — Arya Cotton Industries, Vishnu Aroma Pouching, Eicher Motors, Symphony Ltd. and Bangalore International Airport — on the question of when interest under Section 50(1) ceases to accrue. The Tribunal’s holding that interest runs to the date of credit to the Government’s account through PMT-06, not to the date of ECL debit on filing of the return, is particularly significant for practitioners whose clients deposited tax through challans before filing belated returns. The ruling also addresses the 53rd GST Council’s recommendation to amend Rule 88B (effective 10.07.2024) as reflecting the same underlying principle. On penalty, the Tribunal draws a clear line: Section 73(8) immunity requires payment within thirty days of the SCN and is not discretionary — the Hindustan Steel “bona fide” principle does not apply to the statutory minimum penalty under Section 73(9)/Section 122(2)(a).

Disclaimer: This content reflects the editor's personal views and should not be treated as a legal opinion or professional advice.

Full Text
Judgment & Order
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