Interest on ITC: Retrospective amendment and journey ahead!
GST has been a game of trial and error wherein slew of debatable issues have been ironed out by way of prospective and retrospective amendments in the past five years. Levy of interest under GST has been a vexed issue being marred by multiple insufficiencies and inadequacies in the form it was enacted. Absent the machinery provision for complying with the matching provisions hitherto enacted, the issue of levy of interest on undue or excess ITC availed or ITC availed but not utilized or ITC utilized for limited period before reinstatement, loomed large over the industry. This issue finally gained requisite attention and found resolution in the 47th GST Council Meeting held on June 28-29, 2022.
Through this article, our Partner, Mr. Dharnendra Kumar Rana, Managing Associate Mr. Sourabh and Executive, Mr. Rishabh Galhotra have delved into the history of Section 50 of the CGST Act, 2017 and multiple amendments made thereunder to levy interest on ITC. The Authors have further discussed the implications of insertion of Rule 88B to the CGST Rules, 2017 prescribing mechanism for computation of interest on ITC wrongly availed and utilized and having retrospective effect since enactment of GST.
Please click on the below link to read our latest article titled ‘Interest on ITC: Retrospective amendment and journey ahead!’