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Interest on itc reversal

This query is : Resolved 
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(Querist)
22 October 2020
We have taken wrong itc of hotel 60000 but after 2 month we have reversed the same.
During this period we have excess itc credit approx 20000 in credit ledger which was not utilised .and cash ledger credit approx 35000 which was not utilised.
So pls advise whether we have to pay interest on 5000 only or 60000 ?
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Lekhraj sood

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Lekhraj sood (Expert)
22 October 2020 You have to pay the interest to the extent of utilisation of wrong credit availed.
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Birender Singh

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Birender Singh (Querist)
22 October 2020 Thanks.
Can we adjust cash ledger balance amount at the time calculating interest?
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Lekhraj sood

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Lekhraj sood (Expert)
22 October 2020 No, you can not adjust.
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Birender Singh

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Birender Singh (Querist)
22 October 2020 Thanks sir.
Can we pay interest amount from cash ledger balance instead of paying from bank.?
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Lekhraj sood

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Lekhraj sood (Expert)
22 October 2020 Yes , of course you can use cash ledger balance for paying interest.
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