Electronic cash ledger under GST law – all you need to know

Every deposit made towards tax, interest, penalty, fee or any other amount by a GST registered person by internet banking or by using credit or debit cards or national electronic fund transfer or real time gross settlement or by such other mode shall be credited to the electronic cash ledger.

Electronic cash ledger is maintained in form GST PMT-05 for each person liable to pay goods and services tax (GST), interest, penalty, late fee or any other amount on the common portal. This means, electronic cash ledger is a summary of all deposits or payments made by taxpayers.

Electronic cash ledger will be credited for the amount deposited and debited for the payments out of it towards tax, interest, penalty, fee or any other amount. If you want to deposit, then either you or any person on your behalf can generate a challan in form GST PMT-06 on the common portal by clearly specifying the amount to be deposited towards tax, interest, penalty, fee or any other amount.

If any challan is generated, then it shall be valid for a period of 15 days.

Here are the modes of deposits allowed as per rule 3;

  • Internet banking through authorised banks;
  • Credit card or debit card through authorised bank;
  • National electronic fund transfer (NEFT) or real time gross settlement (RTGS) from any bank; or
  • Over the counter payment through authorized banks for deposits up to Rs 10,000 per challan per tax period, by cash, cheque or demand draft.

If payment is through internet banking, credit or debit card and NEFT/RTGS, then there is no restriction on limit of payments. Only restriction of Rs 10,000 is applicable when payments are over the counter (OTC).

When over the counter payment cannot be used

Deposit of up to Rs 10,000 per challan in case of an over the counter payment shall not apply to deposit to be made by –

  • Government Departments or any other deposit to be made by persons as maybe notified by the Commissioner in this behalf;
  • Proper officer or any other officer authorized to recover outstanding dues from any person, whether registered or not, including recovery made through attachment or sale of movable or immovable properties;
  • Proper officer or any other officer authorized for the amounts collected by way of cash, cheque or demand draft during any investigation or enforcement activity or any ad hoc deposit:

Provided further that a person supplying online information and database access or retrieval services from a place outside India to a non-taxable online recipient referred to in section 14 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017) may also make the deposit under sub-rule (2) through international money transfer through Society for Worldwide Inter bank Financial Telecommunication payment network, from the date to be notified by the Board.

For making payment of any amount indicated in the challan, the commission, if any, payable in respect of such payment shall be borne by the person making such payment.

The amount available in the electronic cash ledger may be used for making any payment towards tax, interest, penalty, fees or any other amount payable.

Table showing debit and credit of electronic cash ledger

Electronic cash ledger is credited for any deposit made towards tax, interest, penalty, late fee etc. via internet banking, RTGS, NEFT, credit/debit card etc. It’s also debited for the TDS or TCS claimed.

Credit amount after deposit or TDS/TCS claim, can be used for payment of tax, interest, fees etc. Remaining credit balance amount after all these payments will be refunded to taxable person by debiting the cash ledger.

Important points on electronic cash ledger under GST

  • Manual or physical challans are not allowed under the GST law. You are compulsorily required to generate challans online on the GST portal.
  • A non registered person can make payments on the basis of temporary identification number generated through common portal
  • If payment is made by way of NEFT or RTGS mode from any bank, the mandate form shall be generated along with the challan on the common portal and the same shall be submitted to the bank from where the payment is to be made. Such mandate form shall be valid for a period of 15 days from the date of generation of challan.
  • Where the bank account of the person concerned, or the person making the deposit on his behalf, is debited but no challan identification number is generated or generated but not communicated to the common portal, the said person may represent electronically in FORM GST PMT-07 through the common portal to the bank or electronic gateway through which the deposit was initiated.
  • Tax deducted U/s 51 or collected U/s 52 and claimed in Form GSTR-02 by the registered taxable person from whom the said amount was deducted or as the case may be collected shall be credited to his electronic cash ledger in accordance with the provisions of rule 87.
  • Where a person has claimed refund of any amount from the electronic cash ledger, the said amount shall be debited to the electronic cash ledger. If the refund so claimed is rejected, either fully or partly, the amount debited under sub-rule (10), to the extent of rejection, shall be credited to the electronic cash ledger by the proper officer by an order made in FORM GST PMT-03. The refund shall be deemed to be rejected if the appeal is finally rejected. 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.
  • If the refund so claimed is rejected, either fully or partly, the amount debited under sub-rule (10), to the extent of rejection, shall be credited to the electronic cash ledger by the proper officer by an order made in FORM GST PMT-03.

is a fellow member of the Institute of Chartered Accountants of India. He lives in Bhubaneswar, India. He writes about personal finance, income tax, goods and services tax (GST), company law and other topics on finance. Follow him on facebook or instagram or twitter.

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