As per section 49(7) of the CGST Act, 2017, all liabilities of a taxable person shall be recorded and maintained in an electronic liability register. As per rule 85 of CGST rules, electronic liability register shall be maintained in Form GST PMT-01 for each taxable person on the common portal. If any amount is payable by such taxpayer, then it has to be debited to the said register.
As per the rule, the electronic liability register shall be debited by:-
- The amount payable towards tax, interest, late fee or any other amount payable as per the return furnished by the said person;
- The amount of tax, interest, penalty or any other amount payable determined by a proper officer in pursuance to any proceeding under the act or as ascertained by the said person.
- The amount of tax and interest payable as a result of mismatch under section 42 or section 43 or section 52; or
- Any amount of interest that may accrue from time to time
Payment of every liability by a registered person as per the return shall be made by debiting the electronic credit ledger or the electronic cash ledger and the electronic liability register shall be credited accordingly.
Amount deducted U/s 51 or the amount collected U/s 52 or the amount payable on reverse charge basis, or the amount payable under section 10, any amount payable towards interest, penalty, fee or any other amount under the Act shall be paid by debiting the electronic cash ledger and electronic liability register shall be credited accordingly.
If any demand is raised, then it will be debited to electronic liability register. Such demand amount shall be reduced to the extent of relief given by the appellate authority or appellate tribunal or court and the electronic tax liability register shall be credited accordingly.
The amount of penalty or liability if any imposed shall be reflected in the electronic liability register. Such amount charged to the register shall stand reduced if the taxable person makes the payment of tax, interest and penalty specified in the show cause notice or demand order and the electronic liability register shall be credited accordingly.
Order in which taxable person shall discharge tax liability
Every taxable person shall discharge his tax and other dues in the following order;
- Self-assessed tax, interest, penalty, fee and other amount payable under CGST Act and rules made thereunder related to returns of previous tax period;
- Self-assessed tax, interest, penalty, fee and other amount payable under CGST Act and rules made thereunder related to returns of current tax period;
- Any other amount payable under this act or the rules made thereunder including demand determined under section 73 and 74
If a person has paid tax on goods and/or services or both shall unless the contrary is proved by him, be deemed to have passed on the full incidence of such tax to the recipient of such goods or services or both.
How the three ledgers are adjusted
Your electronic liability register is debited for followings;
- The amount payable towards tax, interest, late fee or any other amount payable as per the return furnished by the said person;
- The amount of tax, interest, penalty or any other amount payable determined by a proper officer in pursuance to any proceeding under the act or as ascertained by the said person.
- The amount of tax and interest payable as a result of mismatch under section 42 or section 43 or section 52; or
- Any amount of interest that may accrue from time to time
This means for all of your liability, this ledger will be debited stating the total amount that the taxable person is liable. When payment of all liabilities are received as per the return filed, the electronic credit ledger gets credited first for the input tax credit claimed by the taxpayer and credited for the payment received from taxpayer. In the next step, electronic liability register gets credited for the whole amount by debiting available ITC amount in electronic credit ledger and balance liability amount if any left out from electronic cash ledger by debiting it. This means, electronic credit ledger only gets credited while setting off the liability from electronic cash and credit ledger.
Electronic cash ledger gets debited and electronic liability register gets credited for payment of TDS deducted U/s 51, TCS deducted by e-commerce operator U/s 52, amount payable under reverse charge basis, amount payable U/s 10, amount payable towards payment of interest, penalty, fee or any other amount under the Act.
