RULE 86B - UTILISED 100% ITC

[Fahiyaz Ahmmed]

If a person not followed rule 86B and utilized 100% ITC instead of 99%, after realising person want to deposit 1% Tax cash trough DRC-03, My question is what section should be selected during deposit 1% Tax through DRC-03.

[Raam Srinivasan Swaminathan Kalpathi]

Please mention remittance as voluntary and under Section 73 of CGST Act, 2017.  In the reasons window a note may be added to the effect that RTP had erroneously utilised 100% ITC instead of 99% in violation of Rule 86B and that the same is now being sought to be corrected by way of remittance of 1% tax through the cash ledger with interest u/s. 50 for the shortfall period.  You may also mention the month of GSTR-3B Returns in which re-credit (1% excess utilised from credit ledger) is being availed.  Thanks 

[PAWAN KUMAR]

Voluntary payment

please do not forget to mention the remark

[Shilpi Jain]

Do not forget to take back the 1% credit that you have paid extra. Take this in your GSTR-3B and make an intimation to the department.

AI Summary

Voluntary payment under Section 73: correct ITC overutilisation by depositing the shortfall via DRC 03 with interest. Regularise excess ITC utilised in breach of Rule 86B by making a voluntary deposit through DRC 03 under Section 73, stating that 100% ITC was wrongly used and the shortfall is being corrected by cash ledger remittance; provide for interest under Section 50 for the shortfall period and specify the GSTR 3B month in which the 1% re credit is availed. Subsequently claim the recredited amount in the relevant GSTR 3B and intimate the department of the correction.