Answer

1. F

   Facts

   Reverse the excess in your next GSTR-3B or pay it through DRC-03. Interest at 18 percent applies only if the wrong credit was utilised, that is if your credit balance fell below the excess amount.

2. P

   Provisions and law

   • Sec 50(3), CGST Act 2017Interest is payable on ITC wrongly availed and utilised, from the date of utilisation till reversal, at the notified rate (18 percent a year).
   • Rule 88B, CGST Rules 2017Interest on a late return is on the cash portion only; amounts already in the cash ledger by the due date are excluded; interest on wrongly availed ITC runs from utilisation till reversal.
3. A

   Analysis

   Rule 88B(3) treats wrongly availed credit as utilised when your credit ledger balance falls below that amount. If you claimed ₹50,000 extra but always had more than ₹50,000 in your credit ledger, no interest arises. If it was used to pay tax, interest runs from the date of utilisation to the date of reversal. Correct it quickly to limit interest and avoid a notice.

4. C

   Conclusion

   1. 1Work out the excess ITC and the month it was claimed.
   2. 2Check your credit ledger balance after that date.
   3. 3Reverse the excess in the next GSTR-3B or pay through DRC-03.
   4. 4Pay interest if the balance had fallen below the excess.

General guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.