It is my understanding that RCM needs to be paid/settled using hard money, cash, and not paid/adjusted using CENVAT Credit.
But what are the implications in a situation/scenario where it has already been paid/adjusted using CENVAT Credit.
Thank you in advance,
Ankush.
Discussion Highlights Reverse Charge Mechanism Payments: Settle in Cash, Not CENVAT Credit, to Avoid Penalties. A forum discussion addresses the implications of paying Reverse Charge Mechanism (RCM) using CENVAT Credit instead of cash under the Goods and Services Tax (GST) framework. Participants agree that RCM should be settled in cash, not through CENVAT Credit, as using credit is considered an offense that incurs interest and penalties. It is advised to pay the amount in cash promptly, along with interest, and inform the tax department to potentially mitigate penalties by demonstrating a bona fide mistake. The discussion also references relevant sections of the CGST Act, 2017 for further clarification. (AI Summary)
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