Reverse charge pyment

Dear Ankit

Your question is whether you can pay tax under RCM by utilising ITC, correct?

Tax under RCM can be paid only through Electronic Cash Ledger and not by utilizing Electronic Credit Ledger. That is to say, it has to be paid in cash and not by utilizing ITC available. It is so for the simple logic that, by definition, tax paid under RCM is an “input tax” and not an “output tax”. ITC can be used to pay only “output tax” and not “input tax”. [See Sec 2(62)/(82)].

Regards

Ajay