The GST council in the 39th Council meeting held on 14-03-2020 had recommended that interest on delayed payment of GST liability to be charged on the net amount rather than the gross amount. Prior to this, this subject has always been debated as many taxpayers received notices from the department demanding interest on the Gross liability. This debate was however, put to rest after the 39th GST council meeting recommended that interest to be charged on net liability w.e.f. 01.07.2017 (Law was to be amended retrospectively.
However, CBIC vide notification 63/2020 dated 25-08-2020 announced that the above provision shall be applicable w.e.f. from 01-09-2020 causing confusion among professionals and taxpayers, who took to social media to express their disappointment.
Taking note of the same, CBIC issued a press release stating the notification has been issued prospectively due to certain technical limitations and no recoveries shall be made for past period by state as well as central administration in accordance with the decision taken by the 39th GST council meeting.
It is thus clear that Interest is to be charged on net GST liability with effect from 01-07-2017.
Kartik M Jain & Associates, CA in Pune is a professionally managed firm serving domestic and international clients providing services relating to direct and international taxation, indirect taxation, auditing and assurance and Consultancy. It is amongst the best CA firms in Pune. With a team of expert and experienced Professionals, The firm aims to provide quality and effective services. The firm provides complete end to end solutions to your complete business needs under one roof. Our sister Firm, Payal K Jain & Associates, a Company Secretary in Pune provides services in relation to Company Formation in Pune and across India, Corporate Law and Compliance, ROC filings, FEMA, Trademark Registration, etc.
Our Services :- GST consultation, Chartered accountant, Income Tax consultancy, Corporate law, International Taxation, Transfer Pricing, Regulatory & Advisory Services.
