Interest calculation in GST

[anuja bhandari]

If the total GST liability is 10 Lacs for Aug 2018, Eligible ITC availed is 7 Lacs, Balance challan paid on 25 Sept 2018 with interest calculated on 3 lacs for 5 days delay. Return filed on 25 Sep 2018. Whether interest to be calculated on full liability of 10 lacs or Challan payable amount of 3 lacs?

AI Summary

Debate on GST Interest Calculation: Full Liability vs. Net Payable After Input Tax Credit Under CGST Act. A discussion on a forum addresses the calculation of interest on delayed GST payments. The query concerns whether interest should be calculated on the full GST liability of 10 lakhs or the net payable amount of 3 lakhs after availing input tax credit (ITC) of 7 lakhs. Responses highlight differing interpretations of the CGST Act, with some suggesting interest applies to the full liability, while others argue it should only be on the net payable amount. The debate includes considerations on the impact of ITC and potential legal challenges, with suggestions to comply initially to avoid litigation costs.