Wrongly Caimed ITC Reversal Interest Calculation

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This discussion addresses a query regarding the incorrect calculation of interest on wrongly claimed Input Tax Credit (ITC). The user provides a breakdown of their credit ledger, original claims, and tax liabilities for several months. They are seeking clarification on whether a portion of their tax liability can be offset by excess input credit and how this impacts the interest calculation period.

Rahul Aggarwal

Rahul Aggarwal (Querist)
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11 July 2020 Hello Sir, Please help me with this query.
1- month 2- E. Credit Ledger - Due to extra input taken 3- Original Input to be claimed for the month 4- Tax liability for that month
1 - 2 -3 - 4
Dec - 20Lakhs - 2Lakhs - 3lakhs
Jan - 19(last month) - 2lakhs - 3Lakhs
Feb- 18(last month) - 3.5 lkhs - 2Lakhs
Mar- 19.5(lst month) -1.5 lkhs - 3Lakhs

Interest Calculation . Please Help.

Rahul Aggarwal

Rahul Aggarwal (Querist)
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11 July 2020 Can the total tax liability of 2 lakhs in Dec. and Jan. be set off against the extra input of Rs. 1.5 lakhs in the month of Feb. If yes, does it mean the interest calculation on Rs. 1.5 lakhs be also calculated only until the month of Feb.???