Payment of GST and Refunds Under GST – Advanced Tax Laws and Practice Important Questions

Question 1.
Hiyakash Ltd. is a producer of certain products. The tax rate applicable on the supply of goods by them is 18%. (SGST 9% and CGST 9%). The company purchased goods worth ₹47,200 (inclusive of Tax 18%) which is fully utilized in the manufacture of final products. The company sold the goods for ₹25,000 within the State and also exported the goods worth ₹8,000. The invoices are properly uploaded and matched in GSTN Portal. Calculate the tax payable by the company assuming there was no opening or closing stock of inputs or final products.
Answer:
Computation of tax payable by Hiyakash Ltd.

Particulars CGST (₹) SGST (₹)
Tax payable on supply of goods within the state (₹25,000 × 9% each) 2,250 2,250
Tax payable on exported goods of ₹8,000 Nil Nil
Input Tax Credit available on purchase of goods 3,600 3,600
Net GST payable Nil Nil
Excess ITC carried forward to next tax period 1,350 1,350

Question 2.
Balaram, a registered supplier, furnishes the following details pertaining to the month of October, 2017 (First month of starting of business):

Particulars Amount (₹)
Purchase of goods within state 8,00,000
Purchase of goods from outside the state 10,00,000
Inter-state sales 6,00,000
Intra-state sales 12,50,000

The rates of taxes for the goods supplied are as under:

Particulars Rate
CGST 6%
SGST 6%
IGST 1.2%

Compute the GST payable by the supplier Balaram for the month of October, 2017
Answer:
Computation of Net GST payable for Mr. Balaram for the month of October, 2017

Particulars CGST SGST IGST
Output Tax Payable
On Inter State Supply
N.A. N.A. 72,000
(₹6,00,000 × 12%)
On Intra state supply 75,000
(₹12,50,000 × 6%)
75,000
(₹12,50,000 × 6%)
N.A.
Total Output Tax Payable 75,000 75,000 72,000
Less: Input tax credit
w.r.t. IGST (First used to pay output tax of IGST) 72,000

 

Paticulars CGST SGST IGST
w.r.t. IGST – Utilised to pay CGST & SGST 24,000 24,000 N.A.
w.r.t. CGST 48,000 N.A. N.A.
w.r.t. SGST N.A. 48,000 N.A.
Net GST payable 3,000 3,000 N.A.

Notes:
1. On Inter-state supply, IGST shall be payable.

2. On Intra-state supply, CGST + SGST shall be payable.

3. Input Tax Credit of IGST shall be first utilised to pay output tax of IGST and balance, if any to pay output tax of CGST & SGST in any order and proportion. In this case, balance of ITC of IGST amounting to ₹48,000 after paying Output tax of IGST has been utilised equally to pay output tax of CGST & SGST. [Section 49(5) of CGST Act read with Rule 88A of CGST Rules]

4. ITC of CGST shall be utilised to pay output tax of CGST and balance, if any to pay output tax of IGST.

5. ITC of SGST shall be utilised to pay output tax of SGST and balance, if any to pay output tax of IGST.

Question 3.
Nargis Agro Traders located at Jaipur and engaged in the business as retail traders provides the following details of its purchases and sales made during the month of July, 2020:

                                                                                                  Amount in ₹
Items Purchases Sales
Sugar Candies 1,00,000 1,20,000
Chocolate bars 80,000 1,00,000
Wafers packets 75,000 60,000
Biscuits 50,000 50,000

The rate of tax under GST on the items are 5%, 12%, 12% and 18% respectively. You are required to calculate the amount of GST payable and the date by which the due tax is to be paid by the trader for the month of July, 2020 after availing the Input Credit.
Answer:
Note: Since GST Acts require that GST is to be charged separately, hence, all prices are taken as ‘value’ before taxes.

Computation of net amount of tax payable by Nargis Agro Traders on sales during July, 2020.

Particulars Amount (₹) Amount (₹)
Output Tax
Sugar Candies (₹1,20,000 × 5%) 6,000
Chocolate bars (₹1,00,000 × 12%) 12,000
Wafer Packets (₹60,000 × 12%) 7,200
Biscuits (₹50,000 × 18%) 9,000 34,200
Input Tax Credit 5,000
Sugar Candies (₹1,00,000 × 5%) 9,600
Chocolate Bars (₹80,000 × 12%) 9,000
Wafers Packets (₹75,000 × 12%) 9,000 (32,600)
Biscuits (₹50,000 × 18%)
Therefore, Net GST payable 1,600

Assuming that all transactions are intra-state supply. CGST & SGST payable shall be ₹800 each. It should be paid by 20th August, 2020 i.e. on or before due of filing GST Return for the month of July.

Question 4.
Mudit Enterprises, registered in the State of Maharashtra (Mumbai) is engaged in supply of various goods and services exclusively to persons notified under section 51 of the CGST Act, 2017.

Calculate the amount of TDS to be deducted by the recipient if any, from the details given below of three independent contracts for the month of November, 2018:

                                                                                                                                                                                                                                                                                                                 Figures in ₹
Particulars Contract I Contract II Contract III
Place of supply Mumbai Mumbai Mumbai
Registered Place of recipient Mumbai Mumbai Delhi
Total Contract value (Inclusive of GST) 2,75,000 3,10,000 4,50,000
Payment due in November, 2018 (exclusive of GST) 55,000 60,000 1,20,000

Answer:
The tax at source (TDS) would be deducted @1% under CGST Act and 1% under SGST/UTGST Act or 2% under IGST Act as the case may be, of the payment made to the supplier where the total value of such supply, under a contract, exceeds ₹2,50,000 (excluding the amount of GST indicated in the invoice). Thus, individual supplies may be less than ₹2,50,000 but if the value of supply under a contract is more than ₹2,50,000, TDS will have to be deducted as per rates prescribed.

Contract I:
Given contract value is inclusive of GST, therefore to calculate contract value for TDS purpose the same is calculated exclusive of GST (CGST and SGST) ₹2,75,000 × 100/112
= ₹2,45,535.71 or ₹2,45,536 (rounded off).

Since the total value of supply under the contract does not exceed ₹2,50,000, tax is not required to be deducted on amount of ₹55,000.

Contract II:
The contract value exclusive of GST shall be:
₹3,10,000 × 100/112
= ₹276785.71 or ₹2,76,786 (rounded off)

Since the total value of supply under the contract exceed ₹2,50,000, tax is required to be deducted on ₹60,000 @196 under CGST Act and 1% under SGST Act because this is an intra-state transaction (i.e. place of supply and location of supplier is in the same State).

Hence, TDS would be 196 of 60,000 = ₹600 (CGST) and ₹600 (SGST)

Contract III:
The proviso to section 51(1) of CGST Act, 2017 lays down that when the location of the supplier and the place of supply is in a State which is different from the State/Union territory of registration of the recipient, there will be no TDS. Since the location of the supplier and the place of supply is Mumbai and the State of registration of the recipient is Delhi, no tax is liable to be deducted in the given case on amount of ₹1,20,000.

Question 5.
State the rate of tax for collection of tax at source applicable to electronic commerce operator under CGST Act, under SGST Act and under IGST Act, 2017. Also specify when and on what value the rate of tax for collection at source will be applicable.
Answer:
Tax Collected at Source (TCS) under GST law Under Section 52 of the CGST Act, 2017, every electronic commerce operator, not being an agent, shall collect an amount calculated at such rate not exceeding one per cent, as may be notified by the Government on the recommendations of the Council.

However, on the recommendations of the Council, the Government has issued notifications whereby it has fixed rate of TCS @ 0.5% under CGST Act and 0.5% under SGST Act, in case of intra-state supplies, and @1% under IGST Act, in case of inter-state supplies.

TCS would be calculated on the net value of taxable supplies made through the electronic commerce where the consideration with respect to such supplies is to be collected by the electronic commerce operator.

The net value of taxable supplies is the aggregate value of taxable supplies of goods or services or both made during any month by all registered taxable persons through the operator as reduced by the aggregate value of taxable supplies returned to the suppliers during the said month.

It has also been clarified that net value for the purpose of Section 52 shall not include TCS collected under the Income Tax Act. TCS shall be collected by the Operator while paying to the supplier the price of the product/services.

Question 6.
Govinda Exports, a partnership firm, is registered under GST in the State of Gujarat. The firm exports goods without payment of tax under letter of undertaking in accordance with the provisions of section 16(3)(a) of the IGST Act, 2017.
The supplies made during a tax period are as under:

Particulars (₹)
Domestic supplies of taxable product ‘P’ during the period [excluding tax @ 5%]
[Inputs used in manufacturing of such goods are taxable @ 18%]
14,00,000
Export of product ‘Q’ in Austria for Euro 20,000.
Assessable value under customs in Indian rupees
12,00,000

[Export duty is levied on product ‘Q’ at the time of exports]

Product P is not notified as a product, in respect of which refund of unutilized ITC shall not be allowed under section 54(3)(ii) of the CGST Act, 2017.

The ITC available for the above tax period is as follows:

Particulars (₹)
On inputs (including ₹60,000 on export of exempt supplies) 4,60,000
On capital goods 1,40,000
On input services (including ₹18,000 on outdoor catering) 2,10,000

You are required to compute the maximum amount of refund admissible to the supplier for the given tax period.
Answer:
Determination of maximum amount of refund admissible to Govind Exports:

Particulars Amount (₹)
Domestic supplies of taxable product ‘P’ during the period 1,45,385
Export of Product “Q” to Austria
Total Refund claim admissible to the supplies 1,45,385

Notes:

1. Export of goods is a zero-rated supply in terms of section 16(1)(a) of the IGST Act, 2017. Further, the supplier exports goods without payment of tax under letter of undertaking in accordance with the provisions of section 16(3)(a) of the IGST Act, 2017.

Therefore, as per clause (i) of first proviso to section 54(3) of the CGST Act, 2017, a registered person may claim refund, of any unutilized ITC in the case of zero-rated supply at the end of any tax period. However as per 1st proviso to section 54(3) of the CGST Act, 2017 no refund of unutilised input tax credit shall be allowed in cases where the goods exported out of India are subjected to export duty.

2. Refund of unutilised ITC is allowed in case of inverted duty structure, i.e. where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies, except supplies of goods or services or both as may be notified by the Government on the recommendations of the GST Council [Clause (ii) of the first proviso to section 54(3) of the CGST Act, 2017]

Rule 89(5) of the CGST Rules, 2017 stipulates that in the case of refund on account of inverted duty structure, refund of ITC is granted as per the following formula –

Maximum Refund Amount =

Turnover of inverted rated supply of goods and services X Net ITC Less (A)
Adjusted Total Turnover
Where
A = Tax payable on such inverted rated supply of goods or services
“Net ITC” means ITC availed on inputs during the relevant period other than the ITC availed for which refund is claimed under sub-rule (4A) or (4B) or both.
“Adjusted total turnover” means the sum total of the value of:

(i) the turnover in a State/Union territory, as defined under Section 2(112), excluding turnover of services; and
(ii) the turnover of zero-rated supply of services determined in terms of specified manner and non-zero-rated supply of services, excluding:

(a) value of exempt supplies other than zero-rated supplies; and
(b) the turnover of supplies in respect of which refund is claimed under sub-rule (4A) or sub-rule (4B) or both, if any, during the relevant period.

Tax payable on inverted rated supply of goods = ₹14,00,000 × 5%= ₹70,000
Here, Net ITC = ₹4,00,000
Adjusted Total Turnover = ₹26,00,000 [₹14,00,000 + ₹12,00,000]
Turnover of inverted rated supply of goods = ₹14,00,000
Thus, maximum refund amount under rule 89(5) = [(₹14,00,000 × ₹4,00,000)/₹26,00,000] – ₹70,000 = ₹1,45,385

Question 7.
Write a note on refund of tax under section 54 of CGST Act. Discuss the provisions relating to refund of balance of electronic cash ledger as per the GST law.
Answer:
Any person claiming refund of any tax and interest, if any, paid on such tax or any other amount paid by him, may make an application electronically in prescribed form before the expiry of 2 years from the relevant date. A registered person, claiming refund of any balance in the electronic cash ledger in accordance with provisions of section 49(6), may claim refund in the return furnished under section 39, in such manner as may be prescribed.

Question 8.
Vaibhav, a registered supplier under GST law, has furnished the following details for the month of August, 2017:

a. Purchases of goods made from outside state: ₹8,00,000
b. Inter-state supply of goods: ₹10,00,000
c. Goods taken for personal use in above ₹20,000

The IGST was paid on 10th October, 2017.

Calculate the interest payable on delayed payment.

You are informed that the IGST rate for all goods dealt with by Vaibhav is 18%.

Answer:
Computation of IGST payable and interest thereon under GST for delayed payment:

Particulars Amount (₹)
a. Output Tax: IGST @ 18% on ₹10,00,000 1,80,0000
b. Less Input Tax Credit w.r.t IGST on Inter-state purchases (₹7,80,000 × 18%) 1,40,000
c. Net GST payable 39,600
Due date of payment of the above GST 20,09.2017
Actual date of payment of GST 10.10.2017
Number of days delay 20
Interest payable @ 18% p.a. for delay (₹39,600 × 18% p.a. × 20/365) 391

Note:
Input Tax Credit is blocked for goods taken for personal use. (Section 17(5) of CGST Act}.
Hence, ITC is claimed on purchases of ₹8,00,000 – ₹20,000 = ₹7,80,000.

Question 9.
M/s Nose Ltd. reduced the amount of ₹2,25,000 from the output tax liability in contravention of the provisions of section 42(10) of the CGST Act, 2017 in the month of January 2018 (vide invoice dated 12th January, 2018), which is ineligible credit at invoice level. As a result, a show cause notice was issued by the Central Tax Department under section 74 of the CGST Act, 2017 along with interest. M/s Nose Ltd. paid the tax and interest on 5th March, 2018. Find the interest liability if any? Ignore penalty.
Answer:
As per section 42(10) read with section 50(3) of CGST Act, 2017 amount reduced from the output tax liability in contravention of the provisions of section 42(7) shall be added to the output tax liability of the recipient in his return for the month in which such contravention takes place and such recipient shall be liable to pay interest on the amount so added at the rate specified in the section 50(3) of CGST Act, 2017.

Therefore, applicable interest rate shall be 24% per annum.
January month return due date is 20th of February, 2018.
Interest = ₹1,923 (₹2,25,000 × 24% × 13/365)
From 21st February 2018 to 5th March 2018 = 13 days

Question 10.
Jogiram (P) Ltd. claimed ITC of ₹2,50,000 with an intention to defraud the Revenue. What is the rate of interest at which the liability could be discharged voluntarily? Can the Revenue levy penalty, if so, how-much? Can the tax, interest, penalty and any payment due under reverse charge, be adjusted against ITC of a registered person?
Answer:
Utilisation of ITC

Section 74 of the CGST Act, 2017 says that when a registered person has not paid tax or short paid or received erroneously refund or claimed input tax credit by reason of fraud or any wilful mis-statement or suppression of facts, he shall be liable to pay such tax along with interest payable under section 50 of the Act. Presently, the rate of interest notified under Section 50 is 24% where undue or excess claim of ITC is done.

Where the registered person pays such tax along with interest voluntarily before the service of notice under Section 74, it shall be liable to pay penalty at the rate of 15% of such tax in terms of Section 74(5) of the Act. Section 49(4) of the CGST Act provides that the amount available in the electronic credit ledger may be used for making any payment towards output tax under this Act or under the Integrated Goods and Services Tax Act in such manner and subject to such conditions and within such time as may be prescribed.

Section 2(82) of the CGST Act defines the term “output tax” in relation to a taxable person, means the tax chargeable under this Act on taxable supply of goods or services or both made by him or by his agent but excludes tax payable by him on reverse charge basis;

Thus, the amount available in the electronic credit ledger i.e. input tax credit can be used only towards payment of output tax and the definition of output tax includes only tax chargeable on taxable supplies and excludes tax chargeable under reverse charge.

In light of above, input tax credit can be used only for the payment of tax and cannot be used for payment of interest, penalty and tax under reverse charge.

Author’s Note:
It is a combined question on demand and payment.

Question 11.
PQR Ltd., of Mumbai having its business activities spread over different places/locations in India provides the following particulars/details of its GST liabilities for the quarter ended on 30th Sept., 2018: (The balance in Electronic Cash Ledger available with PQR Ltd. was of ₹6,25,000):

Particulars Amount (₹)
Demand raised as per section 73 or section 74 under CGST Act, 2017 belonging to July, 2018. 6,00,000
Demand raised as per the old provisions of Indirect Taxes being applicable on PQR Ltd. 1,10,000
Tax liability of CGST, SGST/UGST, IGST for supplies made during August, 2018. 1,25,000
Interest & Penalty on delayed payment and filing of returns belonging to August, 2018. 20,000
Tax liability of CGST, SGST/UGST, IGST for supplies made during September, 2018. 1,50,000
Interest & Penalty on delayed payment and filing of returns belonging to September, 2018. 25,000

Suggest the manner in which the company can utilise the balance amount available in the Electronic Cash Ledger for discharging the tax liability.
Answer:
Balance in e-cash ledger can be used in the following manner to discharge tax liability by PQR Ltd. for quarter ended on 30.09.2018: [Section 49(8) of CGST Act]

Particulars Amount (₹)
Balance available in E-Cash Ledger 6,25,000
Less: Adjustment of taxes/payment of taxes
Tax liability of CGST, SGST/UTGST, IGST for supplies made during August, 2018 (1,25,000)
Interest and Penalty on delayed payment and filing of return belonging to August, 2018 (20,000)
Tax liability of CGST, SGST/ UTGST, IGST for supplies made during September, 2018 (1,50,000)
Interest and Penalty on delayed payment and filing of return belonging to September, 2018 (25,000)
Demand raised as per section 73 or section 74 under CGST Act, 2017 of ₹6,00,000 to the extent of available balance (3,05,000)
Balance in Electronic cash ledger Nil

Notes:
1. The balance amount of ₹2,95,000/- (₹6,00,000 – ₹3,05,000) towards demand raised under section 73 or section 74 under CGST Act, 2017 to be discharged first.

2. The demand of ₹1,10,000/- raised under old provisions of Indirect Taxes shall be discharged after discharge of demand of ₹2,95,000/-

Question 12.
Pari Ltd. of Jodhpur, Rajasthan is a registered manufacturer of cosmetic products. Pari Ltd. has furnished following details for the month of April, 2020.

Sr.No. Particulars Amount  (₹)
A RECEIPTS Amount (₹)
Details of sales
i. Sales in Rajasthan 8,75,000
ii. Sales in states other than Rajasthan 3,75,000
iii. Export under bond 6,25,000
B Payments
1. Raw Materials
i. Purchased from registered suppliers located in Rajasthan 1,06,250
ii. Purchased from unregistered suppliers located in Rajasthan 37,500
iii. Purchased from Punjab from registered suppliers 1,00,000
iv. Integrated Tax paid on imports from USA 22,732
2. Consumables purchased from registered suppliers located in Rajasthan including High Speed Diesel (Excise & VAT paid) worth ? 31,250 for running the machine in the factory 1,56,250
3. Monthly rent for factory building to the owner in Rajasthan 1,00,000
4. Salary paid to employees on roll 6,25,000
5. Premium paid on life insurance policies taken for specified employees. Life insurance policies for specified employees have been taken by Pari Ltd. to fulfil a statutory obligation in this regard. The Government has notified such life insurance service under section 17(5)(b)(iii)(A). The life insurance service provider is registered in Rajasthan. 2,00,000

All the above amounts are exclusive of all kinds of taxes, wherever applicable. However, the applicable taxes have also been paid by Pari Ltd

The balance of Input Tax Credit (ITC) with Pari Ltd. as on 1st April, 2020 is
– CGST: ₹20,000
– SGST: ₹20,000
– IGST: ₹15,000

Assume CGST, SGST & IGST rates to be 9%, 9% and 18% respectively, wherever applicable.
Assume that all the other necessary conditions to avail Input Tax Credit have been complied with by Pari Ltd., wherever applicable.
Compute eligible Input Tax Credit and net GST payable by Pari Ltd. for the month of April, 2020.
Solution:

Particulars CGST(₹) SGST(₹) IGST(₹)
1. Raw Material IGST(₹)
Purchased from local registered Suppliers (₹1,06,250 × 9% each) 9,563 9,563
Purchased from local unregistered suppliers
Purchased from Punj ab from registered supplier (₹1,00,000 × 18%) 18,000
Raw material imported from USA 22,732
2. Consumables (₹1,56,250 – 31,250) × 9% each 11,250 11,250
3. Monthly rent for the factory building to the owner in Rajasthan 9,000 9,000
4. Salary paid to employees on rolls
5. Premium paid on life insurance policies for specified employees (₹2,00,000 × 9%) 18,000 18,000
Total 47,813 47,813 40,732
Add: Opening balance of ITC as on 01.04.2020 20,000 20,000 15,000
Eligible ITC 67,813 67,813 55,732

Computation of net GST payable for the month of April, 2020

Particulars CGST (₹) SGST (₹) IGST (₹)
Output Tax
On Intra-state supply (₹8,75,000 × 9% each) 78,750 78,750
On Inter-state supply (₹3,75,000 × 18%) 67,500
Exports under bond

 

Particulars CGST (₹) SGST (₹) IGST (₹)
Total Output tax payable 78,750 78,750 67,500
Less: Input Tax Credit
w.r.t. IGST 55,732
w.r.t. CGST 67,813
w.r.t. SGST 67,813
Net GST payable 10,937 10,937 11,768

Notes:

  1. Credit of Input Tax (CGST & SGST/IGST) paid on raw materials used in the course or furtherance of business is available in terms of section 16 of CGST Act.
  2. All intra-state procurements made by a registered person from an unregistered supplier have been exempted from GST. Therefore, since no GST is paid on such raw materials purchased, there does not arise any question of Input Tax Credit on such raw material.
  3. IGST paid on imported goods qualifies as input tax in terms of section 2(62) of CGST Act, 2017. Therefore, credit of IGST paid on imported raw materials used in the course or furtherance of business is available in terms of section 16 of CGST Act.
  4. ITC on consumables being inputs used in course or furtherance of business is available. However, since levy of GST on high speed diesel has been deferred till a date to be notified by Government, there cannot be any ITC on the same.
  5. ITC on monthly rent is available as the said service is used in course or furtherance of business.
  6. Services by employees to employer in the course or in relation to his employment is not a supply in terms of section 7 read with Schedule ITT to the CGST Act. Therefore, since no GST is paid on such services, there cannot be any ITC on such services.
  7. ITC on life insurance services is available if the same is notified by the Government as being obligatory for an employer to provide to its employee under any law for time being in force.
  8. Export of goods is zero rated supply in terms of section 16 of IGST Act. A zero-rated supply under bond is made without payment of IGST.
  9. Since export of goods is a zero-rated supply, there will be no apportionment of ITC and full credit will be available.

Author’s Note:

ICSI, till date has asked questions in GST of maximum 5 marks each under New Syllabus. However, in Old syllabus, they had once tested students on a 15 marks question on Place of Supply. Considering that, we should not neglect possibility of extensive questions being asked by ICSI. Keeping that in view, above question asked by ICAI is included in this book.

It is also important to do above question for conceptual clarity on various issues and some part of the question may be asked in exam for 5 marks.

Question 13.
How will the IGST be paid? Discuss with the help of an example.
Answer:
The IGST payment can be done utilizing ITC or by cash. However, the j use of ITC for payment of IGST will be done using the following hierarchy,

First available ITC of IGST shall be used for payment of IGST;
Once ITC of IGST is exhausted, the ITC of CGST shall be used for payment of IGST;
If both ITC of IGST and ITC of CGST are exhausted, then only the dealer would be permitted to use ITC of SGST for payment of IGST. Remaining IGST liability, if any, shall be discharged using payment in cash

Example:
IGST Liability: ₹1,00,000
ITC available:

IGST: ₹50,000
CGST: ₹20,000
SGST: ₹20,000

Table showing order of setting off liability:

Figures in ₹

Liability 1 2 3 4
IGST: ₹1,00,000 IGST: 50,000 CGST: 20,000 SGST: 20,000 Cash: ₹10,000

Payment Of Gst And Refunds Under Gst Notes

Sections involved for payment of GST: 49 to 53 of CGST Act. Payment of Tax interest, penalty, and other amounts

a. Amount of GST paid is credited to E-Cash Ledger.
b. Input tax credit as self-assessed is credited to E-Credit Ledger.
c. Amount in E-credit ledger can be used only for paving Output j Tax and in the manner and sequence given here. (Also consider | provisions of sections 49A and 49B of CGST Act read with Rule 88A of CGST Rules).
d. Discharge of tax and other dues under this Act or rules made thereunder is in the following order :

i. Self-assessed tax and other dues related to returns of pre¬vious tax period;
ii Self-assessed tax and other dues related to return of current tax period;
iii Any other amount payable under this Act or rules made thereunder including the demand determined under section 73 or section 74.

Interest on delayed payment of tax

  • Rate of interest: 18% p.a.
  • However, where a taxable person makes an undue or excess claim of Input Tax Credit or undue or excess reduction in output tax liability, the rate of interest shall be 24% p.a.

Tax Deducted at Source (TDS)

  • Applicability only in limited cases
  • TDS at 1% if the total value of taxable supply (excluding taxes) exceeds
  • No deduction shall be made if the location of the supplier and the place of supply is in a state or union territory which is different from the state or as the case may be,

Union Territory of registration of the recipient.

  • The time limit for deposit of TDS: Upto 10th of next month.
  • It is mandatory to obtain registration for persons liable to deduct tax at the source.

Tax Collection at Source (TCS)

  • E-commerce operator to collect tax at source of the net value of taxable supplies made through it by other suppliers.
  • Current Rate of TCS : 1% of net value of taxable supplies (0.5%: CGST & 0.5% SGST).
  • The time limit for deposit of tax – Upto 10th of next month.
  • E-statement to be filed up to 10th of next month.
  • Annual Statement to be filed up to 31st December of succeeding financial year.
  • Rectification of mistake in a monthly statement by ECO.
  • TCS will be claimed by the supplier.
  • Matching of details furnished by ECO with details furnished by the supplier.
  • Communication of discrepancy in details furnished by the E-commerce Operator and the supplier.
  • Non-rectification of discrepancy leads to the addition of an amount of discrepancy to the output tax liability of the supplier.
  • Interest is payable on the amount added to the output tax liability of the supplier.
  • Issuance of notice to furnish details of supplies and stock.
  • Information to be furnished within 15 days from service of notice.
  • Penalty for failure to furnish information: up to ₹ 25,000.
  • Non-applicability of TCS provisions:

a. GST is payable under reverse charge.
b. Exempt Supply.
c. Import of goods or services

  • Sections involved for REFUND: 54 to 58 of CGST Act
  • Concept of “Unjust Enrichment”
  • Situations that may necessitate refund claims.
  • Cases where refundable amounts shall be paid to the applicant instead of being credited to the consumer welfare fund.
  • Provisions relating to refund of the amount of advance tax deposited by a Casual Taxable Person/Non-Resident Taxable Person.
  • Provisions regarding the refund of unutilized Input Tax Credit granted to the registered person.
  • Computation of maximum amount of refund in case of zero-rated supply of goods or services.
  • Computation of maximum amount of refund of ITC in case of Inverted duty structure.
  • Provisions relating to “Provisional Refund”.
  • Refund to UN Bodies, embassies.
  • Interest on delayed refunds

Rate: 6% p.a. if a refund is not paid within 60 days from receipt of application. However, if the refund is as a consequence of adjudicating/appellate authority order, then interest is at 9% p.a. if the refund is not paid within p 60 days from receipt of application.

  • Provisions relating to the Consumer Welfare Fund and its utilization.

CS Professional Advance Tax Law Notes