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Section 50

Section 50 outlines the interest obligations for individuals who fail to pay tax on time, with rates not exceeding eighteen percent as determined by the Government. It specifies that interest is calculated from the day after the tax due date and includes provisions for interest on wrongly availed input tax credit at a rate not exceeding twenty-four percent. This section has been enforced since July 1, 2017, with subsequent amendments and notifications affecting its application.

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25 views1 page

Section 50

Section 50 outlines the interest obligations for individuals who fail to pay tax on time, with rates not exceeding eighteen percent as determined by the Government. It specifies that interest is calculated from the day after the tax due date and includes provisions for interest on wrongly availed input tax credit at a rate not exceeding twenty-four percent. This section has been enforced since July 1, 2017, with subsequent amendments and notifications affecting its application.

Uploaded by

RAMKRIPAL SINGH CONSTRUCTION PVT. LTD.
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© © All Rights Reserved
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*Section 50. Interest on delayed payment of tax.

(1) Every person who is liable to pay tax in accordance with the provisions of this Act or the rules made thereunder, but fails
to pay the tax or any part thereof to the Government within the period prescribed, shall for the period for which the tax or
any part thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be notified
by the Government on the recommendations of the Council:
1[Provided that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the
said period furnished after the due date in accordance with the provisions of section 39, except where such return is furnished
after commencement of any proceedings under section 73 or section 74 3[or section 74A] in respect of the said period, shall
be levied on that portion of the tax that is paid by debiting the electronic cash ledger.]

(2) The interest under sub-section (1) shall be calculated, in such manner as may be prescribed, from the day succeeding the
day on which such tax was due to be paid.
2
[(3) Where the input tax credit has been wrongly availed and utilised, the registered person shall pay interest on such input
tax credit wrongly availed and utilised, at such rate not exceeding twenty-four per cent. as may be notified by the
Government, on the recommendations of the Council, and the interest shall be calculated, in such manner as may be
prescribed]

*Enforced w.e.f. 1st July, 2017.

1. Substituted (w.e.f. 1st July, 2017) by s. 112 of The Finance Act, 2021 (No. 13 of 2021) dated 28th March, 2021 for

"[Provided that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the said period furnished
after the due date in accordance with the provisions of section 39, except where such return is furnished after commencement of any proceedings
under section 73 or section 74 in respect of the said period, shall be levied on that portion of the tax that is paid by debiting the electronic cash
ledger.]"

Brought into force on 1st June, 2021 vide Notification No. 16/2021-Central Tax dated 1st June, 2021.

2. Substituted (w.e.f. 1st July, 2017) by s. 111 of The Finance Act 2022 (No. 06 of 2022) - brought into force w.e.f 05-07-2022 vide Notification
No. 9/2022-C.T, dated 05-07-2022 .

3. Inserted by section 126 of The Finance Act (No. 2) Act, 2024 No. 15 of 2024 dated 16.08.2024.

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