TaxTMI 
TaxTMI 
Late Discharged of Liability in GSTR 3B
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....ate Discharged of Liability in GSTR 3B<br> Query (Issue) Started By: - meil megha Dated:- 27-5-2022 Last Reply Date:- 14-7-2022 Goods and Services Tax - GST<br>Got 6 Replies<br>GST<br>Dear experts we have disclosed the liability by filing GSTR-1 but we have disclosed the liability in GSTR 3B in later months after due date . We were having sufficient ITC balance for the entire period since disclos....
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....ure of short liability till disclosure of same in the later months and the liability has been discharged by utilization of GST credit and not by cash. So as per the proviso of section 50 (1) of Central Goods and Service Tax Act the interest will it applicable. Reply By Ganeshan Kalyani: The Reply: Since you paid thru credit ledger, interest is not applicable. Reply By Altamush Zafar: The Reply:....
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.... Where in GSTR-3B you have paid taxes in later months than the month in which you disclosed in GSTR-1. Interest will be payable. For example liability disclosed in April month GSTR-1 but taxes paid through May month GSTR-3B - Interest payable even if paid thorough credit ledger Reply By Shilpi Jain: The Reply: Strictly going as per section 50 interest will still be applicable. However applying....
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.... the judicial precedents on the matter of interest it can be said that interest will not be applicable. Reply By Amit Agrawal: The Reply: Payment of taxes under gst is linked to debit in electronic cash / credit ledgers. Section 50 (1) reads as under: "Every person who is liable to pay tax in accordance with the provisions of this Act or the rules made thereunder, but fails to pay the tax....
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.... or any part thereof to the Government within the period prescribed, shall for the period for which the tax or any part thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be notified by the Government on the recommendations of the Council. 2[Provided that the interest on tax payable in respect of supplies made during a tax period and declared ....
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....in the return for the said period furnished after the due date in accordance with the provisions of section 39, except where such return is furnished after commencement of any proceedings under section 73 or section 74 in respect of the said period, shall be payable on that portion of the tax which is paid by debiting the electronic cash ledger.]" While proviso allows, subject to conditions ....
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....specified therein (i.e. except where such return is furnished after commencement of any proceedings under section 73 or section 74), to levy interest only on that portion of the tax which is paid by debiting the electronic cash ledger. But, as per the beginning part of said proviso, one needs to declare such tax liability while filing return (i.e. GSTR-3B) for the tax-period when such liability ar....
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....ise. However, Section 39 (9) of the CGST Act, 2017 permits 'rectification' subject to certain conditions and but also subject to payment of interest. So, on plain reading of these provisions, interest is payable. But, there is decent chance for Court (specially, high court) to quash interest-liability on following two grounds: A. Interest is compensatory in nature and in given situation....
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...., Govt. is not deprived of any revenue due to delay in beit in electronic credit ledger; B. Co-joint reading of proviso to Section 50 (1) read with Section 39 (9) means that there is no delay in paying taxes when ITC ledger balance was sufficient constantly in between tax-period/s. However, one cannot be certain whether court will go with very strict interpretation of legal provisions / rules or....
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.... take holistic approach keeping in mind above two grounds. All above are strictly personal views of mine and the same should not be construed as professional advice / suggestion in any way. Reply By Ravinesh Sinha: The Reply: There is interest liability without any dispute.the department may issue SCN for penalty if tax is not paid under 30 days under section 73(11) which is as under Notwithst....
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....anding anything contained in sub-section [6] or sub-section [8], penalty under sub-section [9] shall be payable where any amount of self-assessed tax or any amount collected as tax has not been paid within a period of thirty days from the due date of payment of such tax. Reply By KUMAR Narasimhan: The Reply: Dear Sir/Mam From the above case, if we approach the court is there any possibility for....
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.... not paying Interest. Also new Rule 88B(2) strictly phrase about Interest. Please clarify.<br> Discussion Forum - Knowledge Sharing ....