Interest Provisions under GST

Posted Date : 12-Jul-2017 , 03:49:59 pm | Posted By CASANSAAR print

Listen to this Article

0:00

In exercise of the powers conferred by sub-sections (1) and (3) of section 50, sub-section (12) of section 54 and section 56 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby issued Notification No. 13/2017 – Central Tax, 28th June, 2017 fixes the rate of interest per annum.

Summary Table

S. No.	Section	Relates to	Rate of interest (%)
1	Sub-section (1) of section 50	Interest on delayed payment of tax.	18
2	Sub-section (3) of section 50	Interest on undue or excess claim of input tax credit or undue or excess reduction in output tax liability.	24
3	Sub-section (12) of section 54	Interest on withhold refund: When an order giving rise to a refund is the subject matter of an appeal or further proceedings or where any other proceedings under this Act is pending and the commissioner withhold the refund till such time as he may determine.	6
4	Section 56	Interest is not granted within sixty days from the date of receipt of application after tax ordered to be refunded by proper officer.	6
5	Proviso to section 56	Interest is not granted within sixty days from the date of receipt of application consequent to order passed by an adjudicating authority or Appellate Authority or Appellate Tribunal or court.	9

Detailed Provisions

Interest on delayed payment of tax:

As per the provisions of Section 50(1), every person who is liable to pay tax in accordance with the provisions of this Act or the rules made there under, but fails to pay the tax or any part thereof to the Government within the period prescribed, shall pay interest at the rate of 18 percent per annum for the period for which the tax or any part thereof remains unpaid.

Period for which interest to be paid shall be calculated from the day succeeding the day on which such tax was due to be paid to the date of payment to the credit of the Government.

Interest on undue or excess claim of input tax credit or undue or excess reduction in output tax liability:

As per the provisions of Section 50(3), a taxable person who makes an undue or excess claim of input tax credit or undue or excess reduction in output tax liability shall pay interest on such undue or excess claim or on such undue or excess reduction, as the case may be, at the rate of 24 percent per annum.

Interest on delayed refund:

If any tax ordered to be refunded by proper officer to any applicant is not refunded within sixty days from the date of receipt of application filed by the applicant then interest shall be paid at the rate of 6 percent.

Interest shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application under the said sub-section till the date of refund of such tax.

Further, where any claim of refund arises from an order passed by an adjudicating authority or Appellate Authority or Appellate Tribunal or court which has attained finality and the same is not refunded within sixty days from the date of receipt of application filed consequent to such order, interest at the rate of 9 percent.

Interest shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application filed consequent to such order till the date of refund.

Interest on withhold refund:

As per the provisions of Section 54(11) & 12, where an order giving rise to a refund is the subject matter of an appeal or further proceedings or where any other proceedings under this Act is pending and the Commissioner is of the opinion that grant of such refund is likely to adversely affect the revenue in the said appeal or other proceedings on account of malfeasance or fraud committed, he may, after giving the taxable person an opportunity of being heard, withhold the refund till such time as he may determine.

Where a refund is withheld, the taxable person shall be entitled to interest at the rate of 6 percent per annum.

The author is a member of the ICAI and may be contacted at ca.prabhashchoudhary@gmail.com

Category : GST | Comments : 0 | Hits : 661

Also Read - Advisory on Re-filing of GSTR-3B for some Taxpayers - Re-filing of GSTR 3Bs is now live

The Goods and Services Tax (GST) Department has recently sent out an advisory to specific GST taxpayers about the first chance given to correct errors in their previously filed GSTR-3B forms. This facility was provided due to discrepancies found between the data stored in the GST system and the data that was actually submitted regarding ITC claims, tax payments, etc. This advisory was sent via registered emails to those taxpayers who are directly affected, and these taxpayers can also see the d...

Also Read - Can GST Officer Open GST Web Portal for e- Filing upon full compliance?

The Hon’ble Orrisa High Court in the case of Akshya Kumar Sahu v. Commissioner, Central Goods and Service Tax & Central Excise [Writ Petition (Civil) No. 4644 of 2024 dated February 29, 2024] disposed of the writ petition where Mr. Akshya Kumar Sahu (“the Petitioner”) sought to file an application for revocation of cancellation of registration, but could not file Form GSTR-3B due to suspension of GSTIN. Hence, aggrieved by the circumstances, the...

Also Read - GSTR 9 & GSTR 9C

As per Sec 44 read with rule 80 :- Every registered person whose aggregate turnover exceeds Rs 2 crore is required to file: - Annual Return GSTR 9 - Reconciliation Statement GSTR 9C (if turnover exceeds Rs 5 crore) - Audited financial Statement before 31st Dec 2023 Consequencies for not filing GSTR 9 - late fees Rs 100/ day (Max 0.02% of turnover) Notes: - In case of Multiple GSTIN ( if any GSTIN has nil turnover than als...

Also Read - Biometric-Based Aadhaar Authentication & Document Verification for GST Registration

This is to inform taxpayers about recent developments concerning the application process for GST registration. It is advised to keep the following key points in mind during the registration process. 1. Rule 8 of the CGST Rules, 2017 has been amended to provide that an applicant can be identified on the common portal, based on data analysis and risk parameters for Biometric-based Aadhaar Authentication and taking photograph of the applicant along with the verification of the origin...

Also Read - Difference Between Debit Note And Credit Note: Under GST

Topic covers: 1.What is Debit Note and Credit Note? 2.Debit Note and Credit Note in GST Definition Reason to issue Debit note and Credit Note Time limit to issue 3.Reflection in GST return 4.Format of Debit note and credit note 5.Difference between debit note and credit note 6.FAQs After issuance of the original invoice, there could be changes like change in value, change in tax amount or rate, or any other similar change. It happens in the normal course of business, in this instan...

Comments

You need to be logged in to post comment

No Record Found.

Interest Provisions under GST

Comments

Trending Articles