The Central Board of Indirect Taxes and Customs (CBIC) on Friday has issued administrative instructions for recovery of interest on net cash liability w.e.f. July 1, 2017.
The GST Council, in its 39th meeting, held on March 14, 2020 recommended interest to be charged on the net cash tax liability w.e.f. July 01, 2017 and accordingly, recommended the amendment of section 50 of the CGST Act retrospectively w.e.f. July 01, 2017. The retrospective amendment in the GST laws would be carried out in due course through suitable legislation.
The provision of section 50 was amended vide section 100 of the Finance (No. 2) Act, 2019 to provide for charging Interest on the net cash tax liability, which was based on the recommendations of the 35th meeting of the GST Council which came into effect from September 1, 2020.