CBIC Notification 12/2024: E-Cash Ledger Consideration for Interest Calculation on GSTR-3B Delays

Background:

During the 53rd GST Council Meeting held on June 22, 2024, in New Delhi, a recommendation was made to amend Rule 88B of the CGST Rules. This amendment specifies that any amount available in the Electronic Cash Ledger on the due date for filing the return in FORM GSTR-3B, which is debited during the return filing, will not be included in the interest calculation under Section 50 of the CGST Act for delayed filings.

Notification:

The CBIC has now issued Notification No. 12/2024 – Central Tax on July 10, 2024. This notification, enacted under Section 164 of the CGST Act, introduces the following proviso after sub-rule (1) of Rule 88B:

“Provided that where any amount has been credited to the Electronic Cash Ledger as per sub-section (1) of Section 49 on or before the due date for filing the return, but is debited from the ledger for tax payment after the due date, the said amount shall not be considered for interest calculation if it remained in the ledger from the due date until its debit during the filing of the return.”

Effect of the Notification:

This new provision offers significant relief to registered persons regarding interest payments for delays in filing FORM GSTR-3B. Interest will not be charged on amounts credited to the Electronic Cash Ledger by the due date but debited for tax payment afterward, provided the amount remained in the ledger from the due date until the time of debit.