151.     EXAMPLE            

 Taxable person was unable to determine the rate of tax for the goods valuing Rs. 10 lacs for the month of July and therefore paid tax @ 12% on the basis of provisional assessment on due date. The proper officer passed the assessment order on 10th September. Determine the total amount payable in the following cases:

(i) new tax rate = 18%, payment is made on 14 September

(ii) new tax rate =5%, refund is made on 14 September

(iii) new tax rate= 5%, refund is made on 10 january

(iv) new tax rate= 12%

 

ANSWER

As per section 60 of the CGST Act,

(i) total tax payable = 18% of 10 lacs =180,000

Tax already paid= 120,000

Tax due = 180,000-120,000 = 60,000

Interest u/s 50 = 18% *  60,000 * 25 days/ 365 days = Rs. 740

total amount payable = 60,000+ 740 = Rs. 60740

 

(ii)  total tax payable = 5% of 10 lacs =50,000

Tax already paid= 120,000

Tax refundable = 120,000-50,000 = 70,000

Interest on refund u/s 56 = NIL (refund paid within stipulated time)

total amount refundable = 70,000

 

(iii)  total tax payable = 5% of 10 lacs =50,000

Tax already paid= 120,000

Tax refundable = 120,000-50,000 = 70,000

Interest on refund u/s 56 = 6% * 70,000 *30 days/ 365 days = 345 (beyond stipulated 90 days)

total amount refundable = 70,000+ 345 = 70345

 

(iv) no amount payable as same tax rate. Further the assessee shall apply for release of bond and security.