Applicability of interest on disputed GST amount

[KARAN VERMA]

Sir, if I want to pay any GST liability which is disputed i.e not confirmed whether same is taxable or not. In order to avoid penal provisions I want to pay GST tax amount only.

Whether I need to pay interest also. What plea I should taken to save interest amount.

[Shilpi Jain]

You could consider paying it under protest. Though there is no specific provision under GST which allows this., there is a view that payment under protest should be available.

[DR.MARIAPPAN GOVINDARAJAN]

You have to pay the amount under intimation to the department that you paying the amount as DISPUTE. After the assessment made by the Assessing Officer, if there is any amount due to be paid the same should be paid with interest from the date of order to the date of payment.

[KASTURI SETHI]

I support the views of both experts. I further opine that although FAQs say that there is no provision for payment of GST under protest but in my view erstwhile provisions are saved under Saving Section 174 of CGST Act. Saving Section protects the interest of both i.e. Assessees and Govt. Various courts accept the payment of tax under protest. There is practice to this effect. The purpose of "Under Protest" is to provide natural justice to the assessee. If you pay tax under protest, it shows your bona fides and hence saves from penal action.

No need to pay interest at present. However, interest can also be paid under protest.

AI Summary

Payment under protest: pay disputed GST tax to preserve rights and avoid penalties; interest follows assessment order. Where GST liability is disputed, taxpayers may pay the tax amount under protest and intimate the department that the payment is made as a dispute; doing so demonstrates bona fides and may avoid penal consequences. After assessment, any amount found due attracts interest from the date of the assessment order to the date of payment. Interest may also be paid under protest, but it is not automatically payable at the time of an interim disputed tax payment.