Section 50(1) of CGST act states, “Every person who is liable to pay tax in accordance with the provisions of this Act or the rules made thereunder, but fails to pay the tax or any part thereof to the Government within the period prescribed, shall for the period for which the tax any part thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen percent., as may be notified by the Government on the recommendations of the Council.”
Notification no. 13/2017 central tax dated 28/06/2017was issued wherein it has been notified that for the purpose of se 50(1), rate of interest will be 18% p.a.


Section 75(12) of CGST act states that, Notwithstanding anything contained in section 73 or section where any amount of self-assessed tax in accordance with a return furnished under section 39 remains unpaid, either wholly or party, or any amount of interest payable on such tax remains unpaid, the same shall be recovered under the provisions of section 79.

Also section 79 read with section 75(12) states that the same can be recovered along with the interest payable on such liability and also provides various methods by which the proper officer shall proceed to recover any amount which is payable to the Government.

From the report generated and shared on 01/02/2020, registered person who have not discharged interes tliability while filing GSTR-3B amounting to Rupees Forty-five thousand nine hundred and nintey six crores (Rs. 45,996/- crores) remains unpaid to the government on account of delayed payment of tax.

Provisions of Section 50 arc very clear that interest liability is required to be paid on the tax liability that is paid belatedly, either through cash or through utilization of input tax credit (ITC). In other words, interest is required to be paid on total amount of tax liability as shown in FORM GSTR-3B.

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Date: 19/03/2020