Payment of TAX Under Model GST Laws

1. (1) Deposit towards tax, interest, penalty shall be
credited to Electronic Cash Ledger Account;
Explanation- Date of credit to Government Account
shall be the date of deposit.
(2) Self-assessed ITC (input Tax Credit) shall be
credited to Electronic CREDIT Ledger Account.
(3) Use of Electronic CASH Ledger Amount for
payment of tax, interest , penalty or other liability, if
any.
Chapter –IX of Model GST Law.
35. Payment of tax, interest, penalty and other amounts

2. (4) Use of Electronic CREDIT Ledger Amount for
payment of tax, interest , penalty or other liability, if
any
(5)(a) UTILIZATION OF IGST Credit: can be used for
payment of IGST/CGST/SGST Tax liability but subject
to priority order hereunder :
• 1st Priority: against IGST Tax liability
• 2nd Priority: Balance if any against of CGST
liability, if any.
• 3rd Priority: Balance if any, may be utilized for
payment of SGST liability
35. Payment of tax, interest, penalty and other amounts

3. (b) UTILIZATION OF CGST Credit: can be utilized against payment
of CGST and IGST but subject to priority order hereunder :
1st Priority: against CGST Tax liability
2nd Priority: Balance if any against of IGST liability, if any.
© * CGST Credit can not be utilized for payment of SGST tax
liability.
**As per provision to be incorporated in CGST Act
(b) UTILIZATION OF SGST Credit: can be utilized against payment
of SGST and IGST but subject to priority order hereunder :
1st Priority: against SGST Tax liability
2nd Priority: Balance if any against of IGST liability, if any.
© * SGST Credit can not be utilized for payment of CGST tax
liability.
**As per provision to be incorporated in SGST Act
35. Payment of tax, interest, penalty and other amounts

4. (6) Refund of un-utilized CASH / CREDIT Amount
paid against tax, interest, penalty, fee or other
amount in accordance with provisions of
Sec.38(This Section is for Refund) and the amount
collected as CGST / SGST Refund shall stand
reduced to the extent of refund amount.
• * Importing provision under IGST Act is Sec.27:
Application of certain provisions of the CGST
Act, 2016, therefore , Pls. go through Sec. supra.
35. Payment of tax, interest, penalty and other amounts

5. (7) Recording and maintenance of ALL liabilities of
taxable person in ELECTRONIC REGISTER.
(8) Taxable person shall pay the tax or other dues in
following order:
(a) Self-assessed Tax / other Dues to return of previous
period;
(b) Self-assessed Tax / other Dues to return of current
period;
© any other amount including demand u/s 51 of the Act.
35. Payment of tax, interest, penalty and other amounts

6. (9) Every person who has paid the tax on goods and/or services
under this Act shall, unless the contrary is proved by him, be
deemed to have passed on the full incidence of such tax to the
recipient of such goods and/or services.
Explanation.— For the purposes of this section(i.e, Section 35) ,
the expression “tax dues” means the tax payable under this Act
and does not include interest, fee and penalty.
• ** Comment: Principles of unjust enrichment will invoke
while claiming the refund of excess tax paid amount,
therefore, correct assessment and correct payment should
be put on priority list of job assignment.
35. Payment of tax, interest, penalty and other amounts

7. • There is separate provision for payment of
interest on:
– Tax dues
– undue or excess claim of input tax credit under
sub-section (10) of Section 29
36. Interest on delayed
payment of tax

8. • Who can deduct the TDS?
• The following person can deduct TDS:
– Central /State Govt. Department;
– Local Authorities;
– Govt. agencies
– Such other person notified by Central/State Govt.
– one percent from the payment made or credited to the supplier
• Time of Payment of Tax deducted Amount: to be deposited within 10th
day after end of the month in which deduction made;
• TDS Certificate(containing relevant details as specified in Sec.37(3)) by
dedcutor to dedutee within 5 days of crediting the amount to
Government, if fails to pay , late fee @Rs.100/= per day subject to
maxmimum of Rs.5000/=
• Deductee will claim credit of the TDS amount in Electronic Cash Ledger
Section 37 : Tax deduction at source

9. • If deductor fails to pay the amount to Government within stipulated
period (i.e, 10th Day after end of the month) , shall be liable for payment of
INTEREST .
• Refund to Deductor / deductee in case of excess/ erroneous deduction.
• No refund of excess / erroneous refund if amount deducted has been
• credited to the electronic cash ledger of the deductee.
Views expressed are strictly personal.
Ram Sunder Singh
Bhilai, Durg (C.G.)
Section 37 : Tax deduction at source

10. • TDS to be deducted when total value of
supply under a contract exceeds (>) Rs.10
Lacs;
• TDS Amount: one percent from the payment
made or credited to the supplier .
• Value of supply excludes tax amount indicated
in invoice