ITC REVERSAL QUERY ??

Page no : 2

arsh khan (139 Points)
Replied 05 November 2020

Dear Sir,

I have availed ITC at time of filing 3b which was ineligible as i found later after setting off liability for cgst and sgst. Now i want to reverse the itc after 60 days? How much interest is to be paid and where interest is to be paid in 3b or drc-03 ?

CA Akshay Hiregange (Partner - Audit & Assistance) (4515 Points)
Replied 05 November 2020

Dear Arsh

As ITC is utilised interest would be leviable. Question is at 24% u/s 50(3) or 18%?

In my view for 50(3) to apply GSTR 2 & 3 must be functional (link to section 42 & 43), therefore, 18% can be paid. Also it is useful to note there is no interest on interest

1 Like

arsh khan (139 Points)
Replied 13 November 2020

Thanku so much sir for this important information.

But One part is still unanswered by you that where interest is to be paid in 3b or drc-03 ?

CA Akshay Hiregange (Partner - Audit & Assistance) (4515 Points)
Replied 13 November 2020

If liability related to beyond time period (after Sept) then DRC-03

If within time period can be paid through GSTR 3B.

Where CGST & SGST interest values do not match, in 3B it cannot be disclosed as it auto-populates other value. Can use DRC-03 that time.

arsh khan (139 Points)
Replied 13 November 2020

Sir,

Itc was availed in Jul Aug and Sep return has not been filed yet. So u mean it can be paid in 3b. O do i have an option to pay wherever i want i. e., 3b or drc-03

CA Akshay Hiregange (Partner - Audit & Assistance) (4515 Points)
Replied 14 November 2020

the time limit is linked to sept return due date and not the return itself. So even if its not yet been filed, the option to include in 3B is lost for upto FY 19-20. DRC-03 is the only option.

You may chose to discharge through DRC-03 itself in all cases also. (but not vice versa)