Interest Liability on Delayed Payment of GST Arises by Operation of Law and Cannot be Waived or Reduced by the Court

Last updated: 07 July 2026

Quick Summary

The Karnataka High Court has ruled that the liability to pay interest on delayed GST payments arises automatically by law and cannot be waived or reduced by tax authorities or courts. This decision clarifies that contractual disputes regarding tax burdens are separate from statutory GST obligations. Taxpayers must ensure timely payment and filing to avoid statutory interest and penalties.

Court :
Karnataka High Court

Brief :
The Hon'ble Karnataka High Court in The Commissioner of Central Tax & Ors. v. Sadguru Infratech Pvt. Ltd. [Writ Appeal No. 1076 of 2023 dated June 10, 2026], set aside the Single Judge's order to the extent it issued blanket directions to the Revenue to waive penalty, interest, or the limitation for filing returns/revised returns in respect of delayed returns and payment of tax by a sub-contractor, and held that the liability to pay interest on delayed payment of tax under a fiscal statute arises by operation of law, leaving no discretion in the authority to waive or reduce the same, where the statute makes no such provision.

Citation :
Writ Appeal No. 1076 of 2023 dated June 10, 2026

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