Page 15 - Ch9_POT & TDS-TCS

August:

Ü Out of ₹ 50,000, ₹ 40,000 was already utilised and the balance of ₹ 10,000 was carried forward to the Aug
month. Since eligible ITC (₹ 5,00,000) is lesser than the output liability of ₹ 5,10,000 and the remaining
wrongly availed ITC of ₹ 10,000 is utilised,
Ü Therefore, interest shall be applicable on ₹ 10,000 from the date of filling the return i.e. 25 Sep 20XX.
Ü Calculation of Interest:

Amount of wrongly utilized ITC: ₹ 10,000
Rate of Interest - 18% p.a
Date of utilization of ITC - 20 September 20XX
Date of Reversal of ITC - 20th October 20XX

Interest = 10,000 * 18% *31 days/ 365 days = ₹ 153
4) For the calculation of no. of days, the date of utilization and date of reversal or date of payment of
Tax is to be considered

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