Payment of tax, interest, penalty and other amounts through E-Credit ledger Section 49 - GST Ready Reckoner - GST

Electronic Credit ledger Electronic Credit ledger is for maintaining an account of input tax credit of the registered person. The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41 , to be maintained in the prescribed manner. Manner - Payment of tax, interest, penalty and other amounts Through E - Credit ledger (Section 49) The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41 or section 43A, to be maintained in such manner as may be prescribed. [ Section 49(2) of the CGST Act.] The amount available in the electronic credit ledger may be used for making any payment towards output tax under this Act or under the Integrated Goods and Services Tax Act in such manner and subject to such conditions and within such time as may be prescribed. [Section 49(4) of the CGST Act] Non-utilisation of ITC for tax liability under reverse charge mechanism The amount available in the electronic credit ledger may be used for making any payment towards output tax under CGST, SGST, UTGST or IGST. It is pertinent to note that output tax in relation to a taxable person, means the tax chargeable under this Act [i.e. SGST/ UTGST/ CGST Act, 2017 respectively] on taxable supply of goods and/or services made by him, but excludes tax payable by him on reverse charge basis. ITC available in Electronic Credit ledger, cannot be utilised for tax payable under reverse charge mechanism under Section 9(3) or 9(4) of CGST/SGST Act, 2017 read with Section 5(3) or 5(4) of IGST Act, 2017. Manner and Order of utilisation of ITC [Combined reading of section 49(5), 49A, 49B, rule 88A and Circular No. 98/17/2019 GST dated 23.04.2019] The amount of input tax credit available in the electronic credit ledger of the registered person on account of ITC of IGST :- integrated tax shall first be utilised towards payment of integrated tax and the amount remaining , if any, may be utilised towards the payment of central tax and State tax, or as the case may be, Union territory tax, in that order. ITC of CGST :- the central tax shall first be utilised towards payment of central tax and the amount remaining , if any, may be utilised towards the payment of integrated tax. Condition to utilised the remaining amount of SGST ITC :- the central tax shall not be utilised towards payment of State tax or Union territory tax. ITC of SGST :- the State tax shall first be utilised towards payment of State tax and the amount remaining , if any, may be utilised towards payment of integrated tax. Condition to utilised the remaining amount of SGST ITC a) the input tax credit on account of State tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax. b) the State tax or Union territory tax shall not be utilised towards payment of central tax. ITC of UGST :- the Union territory tax shall first be utilised towards payment of Union territory tax and the amount remaining , if any, may be utilised towards payment of integrated tax. Condition to utilised the remaining amount of SGST ITC :- Provided that the input tax credit on account of Union territory tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax. Utilisation of input tax credit subject to certain conditions [ Section 49A ] The input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment. Order of utilisation of input tax credit [ Section 49B ] The Government may, on the recommendations of the Council, prescribe the order and manner of utilisation of the input tax credit on account of integrated tax, central tax, State tax or Union territory tax, as the case may be, towards payment of any such tax. How the Electronic Credit Ledger shall be maintained [ Rule 86 of the CGST Rules] The electronic credit ledger shall be maintained in FORM GST PMT-02 for each registered person eligible for input tax credit under the Act on the common portal and every claim of input tax credit under the Act shall be credited to the said ledger. The electronic credit ledger shall be debited to the extent of discharge of any liability in accordance with the provisions of section 49 . Where a registered person has claimed refund of any unutilized amount from the electronic credit ledger in accordance with the provisions of section 54 , the amount to the extent of the claim shall be debited in the said ledger. If the refund so filed is rejected, either fully or partly, the amount debited under rule 86(3), to the extent of rejection, shall be re-credited to the electronic credit ledger by the proper officer by an order made in FORM GST PMT-03 . Save as provided in the provisions of this Chapter, no entry shall be made directly in the electronic credit ledger under any circumstance. A registered person shall, upon noticing any discrepancy in his electronic credit ledger, communicate the same to the officer exercising jurisdiction in the matter, through the common portal in FORM GST PMT-04 . Explanation . For the purposes of this rule, it is hereby clarified that a refund shall be deemed to be rejected, if the appeal is finally rejected or if the claimant gives an undertaking to the proper officer that he shall not file an appeal. Read with Some important Clarification 1. Utilisation of the amounts available in the electronic credit ledger and the electronic cash ledger for payment of tax and other liabilities [ Circular No. 172/04/2022-GST dated 6th July 2022 ] .