My client has GST credit for the month of October 2018. But he is filling GSTR 3B return in the month of December 2018. He has output liability of 120000/- and Input Credit of 150000/-. Now if he filling return in December, Whether he is liable to pay interest @ 18% as he has not discharge his liabilities in due date or as he has sufficient balance in credit ledger so he is only liable for Late fees.
Applicability of interest in GST is as follows—
As per Section 50(1) of CGST Act, 2017, 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 or any part thereof remains unpaid, pay on his own, interest at such rate, not exceeding 18%.
Interpretation of above provision is that if a taxpayer is failed to file GSTR-3B within prescribed time limit, liability to pay interest will arise even if sufficient balance of input tax credit is available with taxpayer. Therefore, interest shall be applicable in the above case.