GST
Paying DRC-01A from the credit ledger
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Facts
Tax in DRC-03 can be paid from the electronic credit ledger, subject to the set-off rules. Interest and penalty must be paid in cash.
Provisions and law
- Sec 49, CGST Act 2017Use of cash and credit ledgers for paying tax
- Rule 142(2A), CGST Rules 2017After DRC-01A, the person may pay in full or part through DRC-03 or file submissions in Part B
Analysis
If you have ₹3 lakh IGST credit and the demand is ₹2 lakh IGST, you can pay the tax from credit. Interest of, say, ₹25,000 goes in cash. Where the demand is for wrongly availed ITC, paying from credit may not be accepted, so check.
Conclusion
- Check ledger balances by head.
- Pay tax from credit where allowed.
- Pay interest and penalty in cash.
- Quote the ARN in Part B.
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