Answer

1. F

   Facts

   Only on the cash portion. Under the proviso to Sec 50(1), where a return for a period is filed late, interest is on the tax paid by debiting the cash ledger, not on the part set off with ITC.

2. P

   Provisions and law

   • Sec 50(1), CGST Act 2017Interest is payable on tax paid late for the period of delay at the notified rate (18 percent a year); on a late return it is levied only on the portion paid in cash, except where proceedings under Sec 73, 74 or 74A have started.
   • 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

   Suppose output tax for May was ₹2,00,000, ITC was ₹1,50,000, and 3B was filed 30 days late. Interest is on ₹50,000 net cash: about ₹740. This benefit does not apply if proceedings under Sec 73, 74 or 74A have started for that period. File late returns before any notice to keep it.

4. C

   Conclusion

   1. 1Compute output tax and ITC for the period.
   2. 2Find the net amount paid in cash.
   3. 3Compute interest on that amount for the delay.
   4. 4Pay with the return.

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