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ITC wrongly availed

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Suthaniya P

134 Points Posted on 04 February 2025

Interest Rate on ITC wrongly availed & utilized under Section 50(3) of CGST Act has been reduced from 24% to 18%. Please notification.

Replies (3)

Quick Summary

The interest rate applicable to Input Tax Credit (ITC) wrongly availed and utilised under Section 50(3) of the CGST Act has been reduced from 24% to 18%. This new 18% rate applies when ITC is reversed voluntarily. However, if the GST department raises a demand, the interest rate remains at 24%.

ASHISH JAIN

MANAGER- ACCOUNTS

32 Points Posted on 04 February 2025

18% interest if ITC reversed sue-moto
24% interest if demand raised by GST Deptt

Suthaniya P

134 Points Posted on 05 February 2025

Thank you.

Rushabh

Automation Expert

10733 Points Posted on 14 November 2026

The rate was reduced to 18% per annum by Notification No. 9/2022–Central Tax dated 5 July 2022, amending Notification No. 13/2017–Central Tax. The reduced rate applies to interest under section 50(3) for ITC wrongly availed and utilised; mere wrongful availment without utilisation does not attract this interest.

This rate change fits into the GST interest review and reconciliation workflow. Manual tracking of ITC availment, utilisation and applicable rates is difficult; automation reduces repetitive work while professional judgment remains in control. At Jir AI, our 2,000+ AI agents and 650+ integrations streamline GST, ITR, TDS, TCS and other compliance workflows, helping reduce manual workload by up to 70%. For a workflow discussion, connect with us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1