Interest on Late Filing of GSTR-3B

[Shyam Naik]

Rule 88B was amended not no collect interest for delayed filing of GSTR-3B, if there is sufficient balance in the Electronic Cash Ledger with effect form 10.07.2024. The question is whether the amendment is curative in nature and therefore retrospective. Whether, not giving effect to the amendment from 01.07.2017 would amount to perpetuating the interest collected, which was not due and amounts to violation of Art 265 and 300A.

In the agenda for the 53rd Council Meeting, it is stated collection of interest for mere delay in filing GSTR-3B, in cases of sufficient balance in Electronic Cash Ledger does not seem fair and amounts to collection of interest on tax already received by Government.

In all fairness, the amendment should have been given retrospective effect from inception and the Council / Government should have shown magnanimity, which could have put an end to the litigation lying at various forums, including writ petitions before High Courts.

The Hon'ble High Court of Gujarat, in the case of Arya Construction 2024 (7) TMI 239 - GUJARAT HIGH COURT has ruled in favour of petitioner. The revenue has accepted the judgment. A retrospective effect to the amendment would have been respect to the Rule of Law.

The prospective amendment appears to be too late and half hearted.

[Paul Hicks]

When it comes to late filing of GSTR-3B, it's important to be aware of the interest rates that apply. I found some useful insights on various topics like this when Iit's  here clear that the penalty for late submission can really add up. The interest is typically charged at 18% per annum, and it starts accumulating from the due date of filing. It’s definitely worth staying on top of your deadlines to avoid these additional costs.

[DR.MARIAPPAN GOVINDARAJAN]

Even though it is late it will be helpful to the registered person.  In my view it is not a fit case to give retrospective effect.  If you have any grievance you may file a petition before High Court for getting ruling in your favor.

[Shilpi Jain]

This is not a new provision in my view. It is but logical for the department to understand that they cannot take interest on money that is already lying with them

So in my view it is applicable retrospectively as it is an amendment which is only bringing more clarity.

It is the same way as for the interest on balance in electronic credit ledger. It is a principle that should be applicable from 1.7.17 itself and no question of taking interest on money that you already have.

[Tarun Agarwalla]

dear sir

proviso to Rule 88B(1) does not bring any new law but limit the scope of the sub rule. even though it is not an explanation the same is classificatory and does not bring out any thing new here. 

there fore it must be a clarificetory . however wether this leads to a cause for refund with respect to any amount paid as intrest is matter of further dispute. 

AI Summary

Interest on delayed GST returns: amendment limits interest where electronic cash ledger suffices, but retrospective application is disputed. An amendment excludes interest on delayed GSTR 3B filings where the Electronic Cash Ledger has sufficient balance, narrowing interest liability; its retrospective applicability and whether past interest paid is refundable are disputed, raising constitutional and restitution questions and leaving refund entitlement unsettled despite judicial developments.