TaxTMI 
TaxTMI 
IS INTEREST WILL BE LEVIED U/S 50 FOR DEFAULT IN MAKING PAYMENT TO SUPPLIER WITHIN 180 DAYS?
IS INTEREST WILL BE LEVIED U/S 50 FOR DEFAULT IN MAKING PAYMENT TO SUPPLIER WITHIN 180 DAYS
23 Jan 2025 
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Reversal of input tax credit triggers interest under Section 50 when supplier payment is not made within the prescribed period.
Rule 37(1) requires that where a registered person availed input tax credit but fails to pay the supplier within the specified period, the person must pay or reverse an amount equal to the ITC availed and discharge interest under Section 50 while furnishing FORM GSTR-3B for the tax period immediately following one hundred and eighty days from the date of issue of the invoice. A question persists whether interest runs from the invoice date or from the date ITC was availed. (AI Summary)
Rule 37(1) requires that where a registered person availed input tax credit but fails to pay the supplier within the specified period, the person must pay or reverse an amount equal to the ITC availed and discharge interest under Section 50 while furnishing FORM GSTR-3B for the tax period immediately following one hundred and eighty days from the date of issue of the invoice. A question persists whether interest runs from the invoice date or from the date ITC was availed. (AI Summary)