Interest u/s 50

kiran

accounts manager

263 Points Joined June 2009

Simply crediting amount to cash ledger does not mean liability paid unless setting off the ledgers. hence interest need to be paid.

gangadhar kalangiri

15 Points Joined December 2019

Department side is right, why because, even though you paid the taxes, that are in your cash ledger only, when filing of your GSTR3b, the process is completed.

Shivam RC

Student

23688 Points Joined November 2017

Yes the Department's contention regarding the demand of Interest from 2018 is absolutely right. You have just deposited the taxes to the Bank A/c which gets credited to your E-Cash ledger, which doesn't mean that you have paid the taxes to the Government. A GST Return is treated as a VALID RETURN only when it has been "filed."

JATINDER KUMAR

Accountant

3662 Points Joined May 2018

Yes

You are liable to pay interest

Vijayprakash P

1313 Points Joined July 2018

The contention of GST department is valid. Hence you are liable to pay interest.

guna

Student CMA

74 Points Joined August 2013

Any notification with regards to this

guna

Student CMA

74 Points Joined August 2013

Thanks for reply. Kindly give me the circular/Notification number regarding this issue if any.

U/s 50 not saying that, Cash ledger balance should be set off with said return .

guna

Student CMA

74 Points Joined August 2013

Dear sir, One of contractor terminated from his contract and not paid GST in the year 2017-18. But we have taken the GST Input for the same.

Due to this, while reconciling the GSTR-2A with 3B, CGST Dept forced to reverse the credit taken by us for invoices given by said contractor.

In this case we have paid the GST Amount by using our contractor GST Number and said to contractor to setoff the liability by filing retruns. But the contractor not filed till now and his registration also canceled by Dept.

Later, GST dept revoked his registration and filed his returns But Dept seeking interest from 2018.

Whether the dept contention is right?

How can we manage this issue?

This is the overall issue presenting before you.

guna

Student CMA

74 Points Joined August 2013

Thanks for reply. Kindly give me the circular/Notification number regarding this issue if any. U/s 50 not saying that, Cash ledger balance should be set off with said return .

Read more at: https://www.caclubindia.com/forum/interest-u-s-50-564451.asp?offset=1

Bullseye Advisors

GST consultants

89 Points Joined November 2020

Please refer ruling in M/s. Megha Engineering & Infrastructures Ltd. Vs Commissioner of Central Tax (Telangana High Court) which clarifies this issue that mere payment into cash ledger will not be considered as taxes being paid, till the same is adjusted in GST returns. If the amount is very high, you may consider a writ in HC - though chances of success are low.

Regarding contractor payment, balance in cash ledger can be claimed as refund. Please apply for revocation of cancellation of registration, obtain refund of tax paid, if possible.

Bullseye Advisors

GST consultants

89 Points Joined November 2020

Please refer ruling in M/s. Megha Engineering & Infrastructures Ltd. Vs Commissioner of Central Tax (Telangana High Court) which clarifies this issue that mere payment into cash ledger will not be considered as taxes being paid, till the same is adjusted in GST returns. If the amount is very high, you may consider a writ in HC - though chances of success are low.

Regarding contractor payment, balance in cash ledger can be claimed as refund. Please apply for revocation of cancellation of registration, obtain refund of tax paid, if possible.