liability of interest under gst act-2017

[giri gattupalli]

respected sir,

in recent judgement in

ARYA COTTON INDUSTRIES & ANR. Versus UNION OF INDIA & ANR. - 2024 (7) TMI 239 - GUJARAT HIGH COURT honourable Gujarat high court taken the view that, interest under sec 50 should be levied after considering the date of cash deposited and available in cash ledger only. even FORM-DRC-03 filed in later date. and considered the date of deposit of cash into cash ledger is the date of discharge of GST liability in other words, (considering filing of FORM DRC-03 is as just book adjustment) interest will not be leviable to the extent of cash available in cash ledger. Even FORM-DRC-03 filed in later date.

In GST ACT input tax credit or ITC laying in electronic credit ledger is equal to cash laying in cash ledger then, same logic should apply to electronic credit ledger also. in my opinion in any instance of levy of interest under sec 50, interest should be calculated after deducting amount available in cash ledger and credit ledger also.

I request all honourable members to discuss.

AI Summary

Interest calculation under GST should run only on unpaid liability after deducting cash and credit ledger balances.
Interest under the GST provision should be charged only on the unpaid portion of tax after deducting amounts available in the Electronic Cash Ledger and the Electronic Credit Ledger; under the cited judgment the date cash is deposited into the cash ledger constitutes discharge and later filing of FORM DRC-03 is treated as a book entry.