Considering GST Rule 37, Is interest payable even if ITC availed earlier is not utilized?

[SHIVAM GUPTA]

Considering GST Rule 37 read with Rule 88B(3), Section 16(2)(c) & Section 50(3), Is interest payable even if ITC availed earlier is not utilized?

[Amit Agrawal]

In my view, liability to pay interest u/s 50 (3) read with rule 88B (3) has nothing to do with liability to pay interest under second proviso to Section 16 (2) read with Rule 37.

P.S. I have not understood relevance of Section 16(2)(c) in context of rule 37 quoted in the query.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Amit Agrawal]

But, I also hold a view that nointerest is payable u/s 50 if reversal / payment of ITC is done u/r 37 within / the end of the time limit specified in the second proviso to sub-section(2) of section 16.

And this position remains, in my humble view, even if such ITC was utilised in-between period (i.e. between date of availment of such ITC & its reversal within / at the end of the period of 180 days specified in said proviso).

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Shilpi Jain]

Presently interest will not be payable if the credit is taken for payments beyond 180 days and the credit has not been utilised.

Earlier provisions (before amendment of rule 37) required payment of interest irrespective of whether utilised or not.

[SHIVAM GUPTA]

@shilpi, Thanks

AI Summary

Debate on Interest Payable Under GST Rule 37: Unutilized ITC and Implications of Section 50(3) and Rule 88B(3) A discussion on whether interest is payable under GST Rule 37 if Input Tax Credit (ITC) availed earlier is not utilized. One participant argues that liability to pay interest under Section 50(3) and Rule 88B(3) is separate from the liability under Section 16(2) and Rule 37. Another view suggests no interest is payable if ITC is reversed within the specified time limit, even if utilized temporarily. A third participant notes that current provisions do not require interest payment if the credit is unutilized, unlike earlier rules. The discussion emphasizes these as personal views, not professional advice.