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Interest in GST, Goods and Services Tax - GST

Issue Id: - 117474
Dated: 6-9-2021
By:- Bibhu Tripathy
Interest in GST

  • Contents

Dear experts,

I filed the returns 50 days late. I had sufficient balance in cash ledger. In the return I paid the GST on reverse charge. Should I pay the interest?

Kindly give the answer

with regards

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Posts / Replies

Showing Replies 1 to 3 of 3 Records

1 Dated: 6-9-2021
By:- Vikram Bansal

Finance Ministry has fixed September 1 as appointed date for charging interest on delayed payment of net GST liability.

Net liability refers to gross tax liability minus input tax credit. The GST Council had approved a retrospective amendment but the notification currently has only been issued for the go forward period. There are diverse opinions over this notification. Some experts feel that select taxpayers will get the benefit and there could be more litigation. However, some think that this will help assess deal with due tax cases.

2 Dated: 6-9-2021

Interest is payable because there is a delay in transferring the tax amount into Govt. account.Amount of tax is debited/set off only on the date of filing return and not prior to that. Having sufficient balance in Electronic Cash Ledger does not rescue you from the payment of interest.

The date of transfer of tax amount into Govt. account is the actual date of payment of tax.

3 Dated: 9-9-2021
By:- Shilpi Jain

As far as the department is concerned interest will be levied. In case it is a considerable amount you could consider challenging in the courts since interest is compensatory in nature and should not be levied merely due to missing to file the returns with the liability entry. This is for the reason that the amount paid in the cash ledger is at the disposal of the the government and cannot be used by the taxpayer for anything else other than payment at the GST portal.

However important to note that this would be a long battle!!


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