Wrongly availed and utilised GST

This query is : Resolved

Manoj (Querist)
Follow

29 September 2022 Suppose GST availed is Rs. 200000/- for 2018-19. Utilised the whole ITC for outward supplies during 2018-19.

Later on found, ITC Rs. 200000/- availed was ineligible/wrong availment.

Whether:-
Reversal of ITC alongwith interest would suffice or whether Cash payment (from ECL) has to be made for outward supplies already made in 2018-19 utilising wrongly availed ITC.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

29 September 2022 Cash payment with interest has to be made through DRC 03 .

Manoj

Manoj (Querist)
Follow

29 September 2022 Thanks sir.

Two doubts:
(1) As per section 50(3) of CGST Act, ineligible ITC if utilised, then interest is liable to be paid. In this case, ineligible ITC has been availed and utilised in 2018-19. Hence, whether mere payment of interest would be sufficient.

(2) If eligible ITC availed in future period, say for example 2019-2020, whether liability arised in 2018-19 (due to wrong availment and utilisation of ITC) can be reversed alongwith interest and the liability be settled.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

30 September 2022 1 yes, no penalty for voluntary payment without notice.
2 No.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now