Sales of goods of amount Rs97 lakhs to a party

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This discussion clarifies the GST payment rules for an intra-state supply of goods totalling ₹97 lakhs in August 2026, with an 18% GST rate. According to Rule 86B, a minimum of 1% of the tax liability, amounting to ₹17,460, must be paid in cash. The remaining ₹17,28,540 can be offset using Input Tax Credit (ITC), provided no exemptions apply. The rule is generally applicable for taxable sales exceeding ₹50 lakhs.

ARUN GUPTA

ARUN GUPTA (Querist)

11 September 2026 I have a taxable turnover of Rs. 97,00,000/- for the month of August 2026, which is an intra-state supply taxable at 18% GST. Under the current GST rules including Section 49, Rule 86B, and Rule 87, how much tax am I required to pay in cash and how much can be adjusted against Input Tax Credit (ITC)? Kindly clarify the applicability of the 1% minimum cash payment rule in my case.

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

11 September 2026 For a taxable intra-state supply of ₹97 Lakhs with a total GST liability of ₹17,46,000, Rule 86B mandates that a minimum of ₹17,460 (1%) must be paid in cash through the Electronic Cash Ledger, while the remaining ₹17,28,540 (99%) can be adjusted against available Input Tax Credit, provided none of the statutory exemption criteria apply.

ARUN GUPTA

ARUN GUPTA (Querist)

12 September 2026 This is applicable if the taxable sale is above 50 lakhs rupees.If taxable sale is below 50 lakhs does this rule applies?

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

26 October 2026 Taxable Sales > ₹50 Lakhs: Minimum 1% of the output tax liability must be paid in cash (subject to specified exceptions like higher income tax payment or refund claims).

Taxable Sales < ₹50 Lakhs: Rule 86B is not triggered, meaning 100% of the tax liability can be offset using accumulated Input Tax Credit (ITC) without any mandatory cash outflow requirement under this rule.

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