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ITC Reversal, Goods and Services Tax - GST

Issue Id: - 117096
Dated: 16-3-2021
By:- Ethirajan Parthasarathy
ITC Reversal

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Trader A's GSTR 2A reflects ITC of ₹ 1,00,000- for April20, out of which he utilizes ₹ 18,000/- towards output tax for April. Let us assume that there are no purchases or sales for next 6 months.

One of the vendors to Trader “A” has not been paid for more than 180 days and the ITC reported by such vendor is ₹ 20,000/-

Now trader has to reverse the ITC availed to the extent of ₹ 20,000/-. Since there is sufficient ITC available, the trader has to only reverse the ITC, to bring down the ITC in Electronic Credit Ledger to ₹ 62,000/- (100000 - 18000 - 20000)

My question is whether Trader "A" is still liable for interest on reversal of ITC. If yes, is it on 18,000/- or 20,000/-

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Showing Replies 1 to 2 of 2 Records

1 Dated: 16-3-2021

In this scenario, interest is to be paid on ₹ 20,000/-.

2 Dated: 17-3-2021
By:- Himansu Sekhar

I agree with Kasturi sir


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