CA Umesh Sharma

CA Umesh SharmaArjuna (Fictional Character): Krishna, during this Diwali the due date of filing GSTR-3B and for payment of tax was on 20th October for the month of September.  Further in addition to this government is levying TIME BOMB of late fees for delay.

Krishna (Fictional Character): Arjuna, Diwali is considered to be the most auspicious festival of India. Diwali brings happiness to each and every person in the country. During Laxmi Poojan the tax payer expects that his business will grow exponentially but due to this GST return due date and even late fees of August return has created problems for the tax payer.

Arjuna: Krishna, what is the late fee charged if the GST return is not filed on time?

Krishna: Arjuna, In the GST law there is late fees of Rs 200 per day i.e. Rs 100 per day for CGST and Rs. 100 for SGST respectively. For example- The due date for GSTR-3B of September is 20th of Oct and if the return is filed on 22nd then the late fees of Rs  200 * 2 days = Rs 400 is to be payable.

Time Bomb of late fees of GST return

Arjuna: Krishna, How this late fees can be paid?

Krishna: Arjuna, Late fees of GST has to be paid separately before filing the return of GST and this late fees cannot be adjusted against the credit which means late fees has to be paid. Similarly payment of tax and Interest is to be done separately.

Arjuna: Krishna, Which month’s late fee was removed previously?

Krishna: Arjuna, it is said by the government that late fee of July month was removed. Late fee for August and September was collected by the government. The government had promised that no penalty will be levied for any errors in GST Returns during first 6 months of GST. The tax payer wished that late fee for August and September should be waived as there were many changes made on the GSTN portal and the due date is during Diwali festival.

Arjuna: Krishna, What consequences will lead to late fees of GST?

Krishna: Arjuna, GST law is still in its early stages and it’s been only 4 months since its implementation. At each level Government officials, tax consultants, tax payers are facing issues in understanding GST. After facing all problems they are also filing GST returns. Due to this late filing of GST return late fees is collected by the government but during these initial days where there are so many problems faced by the taxpayers the late fees should not be collected by the government.

Arjuna: Krishna, what should a tax payer learn from this?

Krishna: Arjuna, There were approximately 56 Lakh return filed in the month of July, 50 Lakh in the month of August, 40 Lakh in the month of September and there are total 80 Lakh registrations in GST which means that the government will be collecting huge amount of revenue in the form of late fees. But problem of late fee should not be faced by the person who files return with discipline. If returns not filed on, time then the time bomb of late fees will explode. GST is still in its early stages and such penalties should not be collected while the taxpayers are facing so many problems.

Author Bio

Qualification: CA in Practice
Company: R.B. Sharma and Co
Location: Aurangabad, Maharashtra, India
Member Since: 27 Jan 2018 | Total Posts: 342
1. Vice-Chairmen of WIRC of ICAI for the year 2015-2021. 2. Youngest Chairman of Aurangabad Branch of WIRC of ICAI in 2002. 3. Author of Popular Tax articles series based on Krishna and Arjuna conversation i.e “KARNITI” published in Lokmat on every Monday. Till date 335+ weekly articles ha View Full Profile

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    I am slowly but steadily is getting a feeling that this Government, in the name of bringing discipline, is drifting towards terror reime of penalising citizens.
    Even in Income Tax a poor soldier fighting a terrorist or guaring the Siachen Glacier will be asked to cough up atleast 5,000/- if he does not file his IT Return by due date; a man in comma in hospital will similarly be slapped.

  2. dilip says:

    very big mistake by the govt. by putting this kind of a system of tax on the tax paying genuine bussinessmen, should we run around the consultants or should we learn abcd of computers at this age of 50 plus /listen to excuses put forth our A/c’s staff in terms of non filing because of system crashing. & govt penalising people for the mistake of its own. this is ridiculous.
    its high time govt should think properly before doing /putting such thing on bussinessmen.
    lastly most of our bussiness people are feeling why we should continue doing bussinessess when there is so much of trouble & tension in doing so.
    Tax system should be very simple so that a very uneducated bussinessman also should be able to pay his tax in a simple way. this GST System is very very complicated & does not end with paying of tax for the month it is a trouble by filing of returns so many number of times for 1 single month.
    i think its time to simply it or a day will come when people will have to think about a 2nd option to end this themselves.

  3. Vinay Sonpal Advocate says:

    Once people felt that Rs 100 per day per return and now they interpreted one act one fee and hence it is Rs 200 per day and if now the interpret per return per act per day s 37, 38,39 GSTR 1, GSTR 2,
    GSTR3 it will Rs 200 x30 days x 3 — Rs 18000.00 per month for each month ;if return is not filed in each GSTR 1 .2.3 and if maximum is Rs 5000 x 2 x 3 = Rs 30000.00 per month even if tax due is Rs 1000.00 This is really GABBAR SINGH TAX or DRACONION provision. I agree with one of the advocate suggestion to challenge such draconian law which is akin to penalty in name of fee. If fee is charged Govt should show quid pro quo and if penalty word is used which unltimately is penalty , hearing is must and reasonable cause if shown no penalty is leviable (Hindustan Construction ) and (G S Gautam) hence fee word used by Act is unreasonable and onerours since it is automatic without order and not challengeable since no order passed; but no return is accepted till payment is made and if not it will continue to recur. Court will make GOOD SIMPLE TAX by quashing fees provisions. Charging heavy fees can not be tool to ensure compliance.

  4. L.R.Vishnuram says:

    One may also think and believe that this Late Fee Provision imposed to inculcate discipline in the minds of the tax payers as well as to realize the importance of time consciousness. There fore, time schedules are to be followed very strictly at any cost.

    Thus, by paying late fees every one begins to know the difference between the “Submission of Return” and “Filing of Return”. The Department discourges the time gap between submission and filing. There are no floating time or slack time. All activities are coming in the critical path.

    By paying Hundreds of Thousands of Rupees in hard earned cash / bank money, every one understood the meaning with heavy heart.

    Further, delay in filing happened in many cases due to external factors like the non functioning of the GSTN Portal to the expected level.

    Kindly reverse the above Late Fee Fine.

    Expecting favourable announcement in this aspect, which will make the tax payers to remit the taxes to the Government with happiness.

  5. ASHWIN GALA says:

    There is also Time Bomb of Interest. This will be realized in coming GST returns. If there is error in reporting ITC, Reverse Charge ,GST No. etc. Then even if you have already deposited GST , you will have to pay interest when you rectify these errors. Because the GST is deposited but is not adjusted correctly. This is again a harsh provision because there are many chances of such genuine errors without any intension. Once you have deposited Tax & yet if you have to pay interest , it is Penalty only. Awakening is very much required on this issue also.

  6. Alex D'Mello says:

    This regime doesn’t want to hear anything from tax payers. they behave like Gods. The GST site has problems even today, Displays error message many a times. MTNL net is terrific in most of the places. Without proper infra people are forced to run from pillar to post and most the time is wasted in running after consultants. That is the reason why most people had 25% business in the first two months which affected the economy very badly. People took a long time to understand GST complications. Late fee goes on adding every month and need to pay repeatedly. Even today when it comes GST issues ministers only give bhashan. Is it easing of business promised by PM?

  7. NURUL HUDA says:

    Government is trying to fish in troubled water. Government is not interested to streamline the process of tax payment by the citizen rather interested in collecting of huge amount from the tax payer in the name of late fine / penalty etc. I donot see any wisdom behind such decision to harass tax payers by the concerned authority. Not to speak of about the common people but even for the professionals are facing difficulty to work with the GST portal. Government should review the decision of collecting heavy amount on such pretext and act sensively.


    This late fee provision in initial phase of GST should be challenged in High Court and Supreme Court by following Rajasthan High Court order,unless court issues order againsrst such collection of late fees Govt will not heard your advice,I am a tax advocate in west Bengal,I request to Big association Of chartered Accountants in different states should File a case against this before High court or supreme court as the case may be,otherwise govt will not stop this,
    Thanking You
    Abhijit Majumdar
    Advocate And Tax consultant
    Durgapur west Bengal

  9. akash gangyan says:

    Sir, I have deposited july CGST by mistake in Cess Acconnt rs. 47000/- during online challan generation.
    and for this my july and august return was not filed. pl
    help me how to refund or adjust the amount from CESS account to CGST. as amount is verly huge and I cant deposited again. or tell me other way what to do. as my next returns are pending and creating late fee. I call them but no phone reponse. pl sir help me
    my email id [email protected]
    mob : 9356736279

  10. Samish kr Verma, "ADVOCATE" says:

    On one occasion late fee on filing gst 3b for the August was not paid and yet return was filed and similarly GST 3B for September was also filed without late Fine and similarly after few days the filing of other customer was restricted due to non payment of late Fine.
    What does it means.

  11. Adv. Kapil Banginwar says:

    Late fees should be waived upto 31 march 2018. Otherwise many dealers will cancell their gst registrations. Who will be resposible for this. So govt should obey their promise & late fees should be removed for sll types of gst returns upto 31.03.2018 for first year of gst era

  12. vswami says:

    Instant ( inspired but with a different stroke /wavelength):

    One thing that very clearly emerges from the dialogue is THIS: No surprise that KRISHNA, as the ultimate CREATOR, – of not only the mortals , including Arjuna, but also of all mindsets, -has once for all set the mind (the brain!) being the origin of good and bad, including such ideas as ‘time bombs’. Only one humble suggestion: May be, whatever it is worth the attempt,- instead of spAking to Arjuna, a warrior par excellence, but nonetheless in a confused state of mind, and not an ordinary mortal unlike we,- could have better addressed, with expectation of some result, his words of ‘home truths’ (see the last one), to the bureaucrats, in the North and south Blocks, who are really the ‘law makers’ for humans, – with every individual havng his own mindset, and way of thinking, – never ever in concurrence or synchronized alike.

  13. Ashalatha says:

    What is the logic is collecting late fee when the tax is fully paid & return also submitted but could not file the return due to software issue?

  14. AKHIL MEHRA says:

    What about those still waiting to be able to exercise cancellation who have been forcibly migrated without completing part B of Registration Form and Cancellation facility is not working/available on portal as yet for them


    They make consultants and CA’s as victim. Lots of people came before consultant lately for the submission of their return for the month of August and as the Portal not charged late fee at that time consultants or CA’s filled the return without taking any late fee from the clients and now on September when they came on due time, how it is possible to take late fine from them. Even some of them have to go through severe quarrel with clients.

  16. sunil kumar pattuvakkaran says:

    True Fact..The LATE FEE penalty should be waived by the Govt. Still all tax payers are struggling to clear their doubt and timely filing of return also very difficult.

  17. Adv S.B.Dhadd says:

    The GST Council has not kept its promise given in its press note dtd 25th Aug 2017 that no late fee will be levied for the returns for July and August. Before levying late fees a clarification was expected regarding the difference in Submit and Uploading of returns. All the tax practitioners and the Tax payers were under impression that once the return is submitted , then the late fee will be restricted till the date of Submit from the due date of submitting return.

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