Interest u/s 50

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   .                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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.

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

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. 

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.