ITC reversal

[SUNIL NATH]

Due to auto reflect in ITC setoff in GST portal, we are mistaken to utilize cash and keep balance in credit ledger. Moreover since GSTR-3B is cannot be amended and in case ITC reversal, can interest be levied, if there is sufficient balance in cash ledger ?

AI Summary

Clarification Sought on Interest for Mistaken Use of Electronic Credit Ledger Instead of Cash Ledger Under GST Rules A discussion on a GST-related issue involves a party mistakenly utilizing the Electronic Credit Ledger instead of the Electronic Cash Ledger, despite having sufficient balance in the cash ledger. The party seeks clarification on whether interest can be levied in such a scenario. Responses suggest that if ineligible ITC was availed and utilized, it should be reversed with interest, possibly by reducing other eligible ITC in subsequent returns or paying from the cash ledger. Filing Form DRC-03 for voluntary payment with interest is also recommended. Interest is deemed payable despite having a sufficient cash ledger balance.