Whether Interest is Payable on ITC Reversal under Rule 37 when Sufficient Balance Exists in Electronic Credit Ledger?

Whether Interest is Payable on ITC Reversal under Rule 37 when Sufficient Balance Exists in Electronic Credit Ledger? https://www.taxtmi.com/forum/issue?id=121081 Interest on Input Tax Credit reversal is considered where payment to vendors is not made within 180 days, requiring reversal under Section 16(2) of the CGST Act and Rule 37 of the CGST Rules. The central issue is whether interest under Section 50 applies where sufficient Electronic Credit Ledger balance existed throughout and the relevant credit was never utilised for output tax liability. The analysis distinguishes unutilised credit reversal from wrongful availment and utilisation, including whether delayed-payment reversal has a distinct interest consequence. en-us Mon, 24 Aug 2026 11:40:18 +0530 Mon, 24 Aug 2026 11:40:18 +0530 TaxTMI RSS Generator Whether Interest is Payable on ITC Reversal under Rule 37 when Sufficient Balance Exists in Electronic Credit Ledger? https://www.taxtmi.com/forum/issue?id=121081 Interest on Input Tax Credit reversal is considered where payment to vendors is not made within 180 days, requiring reversal under Section 16(2) of the CGST Act and Rule 37 of the CGST Rules. The central issue is whether interest under Section 50 applies where sufficient Electronic Credit Ledger balance existed throughout and the relevant credit was never utilised for output tax liability. The analysis distinguishes unutilised credit reversal from wrongful availment and utilisation, including whether delayed-payment reversal has a distinct interest consequence. Discussion-Forum GST Mon, 24 Aug 2026 11:40:18 +0530 https://www.taxtmi.com/forum/issue?id=121081