The Gujarat Chamber of Commerce & Industry (GCCI) urged the Union  Finance Minister  Nirmala Sitharaman,  to waive off interest and penalties for the Integrated Goods and Services Tax (IGST) due in accordance with notice No. 54/2018 dated October 9, 2018.

The Gujarat Chamber of Commerce & Industry said that it has heard from a number of its member units who claim to have received summonses, along with interest and penalty, for IGST that is due in accordance with the notification. These businesses imported goods via the advance licence programme, but because the IGST was not recorded in the Bill of Exchange (BOE), they failed to pay it after the shipment was cleared.

"Many units in Gujarat were not aware of the new notification issued by the GST Council, which stated that IGST had to be paid at the time of clearance of the consignment and then claimed as a refund through Input Tax Credit (ITC), or a Letter of Undertaking (LUT) was required to be submitted for not paying the IGST," said Pathik Patwari, president of the Gujarat Chamber of Commerce and Industry. As a result, they cleared their shipments devoid of paying IGST because they believed it was not necessary and that no LUT had been submitted. Additionally, the consignments were cleared by the Customs Department without the LUT or IGST payments.

The GCCI stated that it thinks the units in question made an unintentional mistake and did not seek to purposefully escape paying taxes. The GST Department did not lose any money as a result of this transaction, either. According to the updated announcement, the units would have paid IGST upfront and subsequently requested a refund via ITC, yielding the same results in terms of revenue collection for the GST Department.

However, many of the units are unable to pay the unpaid tax amount because of the accrued interest and penalties. Given that the majority of these units are MSMEs, this could have a negative financial impact on them, it stated.

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