CA. Sanjeev Singhal
How the liabilities in respect of Tax , interest, penalty and other dues under the GST shall be paid, have been summarized hereunder. Same shall be entered in various register etc. All this is prescribed in Section 49 to 50 of the GST Law and GST Payment Rules ,2017.
Payment of Taxes [ Section -49 ]
A] Electronic cash ledger
√ Section provides for three kind of ledger
Electronic cash ledger
Electronic credit ledger
Electronic liability ledger
√ Electronic Cash Ledger
> Internet banking
> Debit or credit card
> NEFT or RTGS
> Over the counter payment in Authorised banks for deposit up to Rs.10000 per challan per tax period by cash, cheque or demand draft.
B] Electronic credit ledger
√ The input tax credit of RP on self assessed basis in the return of taxable person shall be credited to his Electronic Credit Ledger on the common portal in Form –GST PMT-2.
√ The electronic credit ledger may include the following
RP upon noticing any problem can apply on GST PMT-04 on common portal.
√ Manner of Utilisation of ITC
√ Amount of input tax credit in IGST, CGST, SGST or UTGSTshall be utilized as follows :
C] Tax Liability Ledger
√ All amount payable by taxable person shall be debited in Electronic Liability Register in Form-GST PMT-01. Payment of every liability by registered taxable person shall be by debiting the electronic credit ledger and crediting the electronic liability register.
“Tax due” means tax payable under the Act but does not include interest , fees or penalty.
“ Other due “ mean interest, fees and penalty.
Interest on delayed payment of Tax [ Section 50 ]
√ Every person liable to pay tax and fails to pay the same on due date , shall pay interest on unpaid amount at the rate as prescribed from the due date of payment of tax to the date of payment. Interest shall be paid to the account of central or State Government.
√ Interest shall be paid from the first day on which such tax was due.
√ In case taxable person claim excess input credit u/s 42 and or reduction in output tax liability u/s 43, shall be liable to pay interest on such amount excess claimed or reduction in output tax liability under .
Situation when interest is payable
1. Delay in payment of Tax – Interest rate can not exceed 18%
2. Undue or excess claim of ITC- S.42- Interest rate can not exceed 24%
3. Excess reduction in Output tax liability-S.43- Interest rate can not exceed 24%.
√ Tax return u/s 39 shall be valid only if the tax payable as per the return is paid in full.
√ Section 73 and 73 provide that if the interest is paid, adjudicating authority shall not serve any show cause notice.
√ Section 78 provides that where show cause notice has been issued but the interest is paid within 30 days of issue of notice , no penalty in this case shall be payable and case shall be concluded there only.
The contents of this article are solely for information and knowledge and does not constitute any professional advice or recommendation. Author does not accept any liability for any loss or damage of any kind arising out of this information set out in the article and any action taken based thereon.
About the Author: Author is practicing chartered accountant in Gurgaon and having specialisation in Service Tax and Haryana VAT. He can be reached at firstname.lastname@example.org