All about late fee on delayed filing of GSTR-3B

As per Section 47(1) of the CGST Act, 2017 and respective State GST Act(s) the late fee for filing of returns , including GSTR-3B is Rs 100/- per day ( each for CGST and SGST) subject to maximum of Rs 5000/-(each for CGST and SGST). Thus total late fee for delay was Rs 200 per day subject to maximum of Rs 10,000/- for each return.

Section 20 of the IGST Act,2017 provides application of certain provisions of the CGST Act, 2017 or rules made thereunder, shall mutatis mutandis apply, so far as may be, in relation to IGST as they apply in relation to central tax as if they are enacted under the IGST Act. However an exception to this is in regard to late fee as Sec 20(viii) of the IGST Act, 2017 clearly excludes late fee from its ambit. Accordingly there is no separate late fee levied under IGST Act, 2017.

However late fee is applicable under UTGST Act, 2017 as per Section 21(ix), as application of late fee has not been excluded therein. Thus we can conclude that late fee shall be applicable under CGST Act and SGST (supply within State) or UTGST (supply within Union Territory).

Since introduction of GST regime there have been several instances when late fee has either been waived or reduced by Government considering requests of tax payers, as per powers conferred in Section 128 of CGST / SGST Act(s).

Waiver of late fee

In regard to filing of GSTR-3B is concerned, the late fee was waived vide Notification No. 76/2018-Central Tax, dated 31.12.2018 , for the months of July 2017 to September, 2018, subject to condition that the returns are filed between 22.12.2018 to 31.03.2019.

Reduction in late fee

The per day late fee for filing of GSTR-3B was reduced vide Notification No. 76/2018-Central Tax, dated 31.12.2018 , to Rs 10 per day (each for CGST and SGST Act) for NIL tax return , and others Rs 25 per day (each for CGST and SGST) subject to maximum of Rs 5000/-(each for CGST and SGST).

Thus total late fee for delay was reduced from Rs 200 per day to Rs 20 per day (for NIL return) and Rs 50 per day (for others) by waiving the balance late fee. The maximum limit of late fee of Rs 10,000/- was kept unchanged.

Relief in late fee in filing of GSTR-3B due to COVID-19 pandemic (Feb,2020 to May,2020)

The relief in levy of late fee in filing of GSTR-3B granted due to COVID-19 pandemic is tabulated below:

*Due date of GSTR-3B not extended but relief granted in late fee as above vide Notification No. 32/2020-CT, dated 03.04.2020. However if GSTR-3B not filed by above dates , late fee shall be applicable from the respective due dates.

** Due date of filing extended.

Decision of GST Council regarding waiver / reduction in late fee (July, 2017 to January, 2020)

The much awaited 40th meeting of the GST Council,was held on 12th June, 2020 wherein several measures for Trade Facilitation were decided upon by the Council. One of such measure is the waiver / reduction of late fee for filing of GSTR- 3B for period July, 2017 to January, 2020.

As a measure to clean up pendency in return filing, the GST Council has decided waiver / reduction in late fees for not furnishing Form GSTR-3B for the tax period from July, 2017 to Jan, 2020 as under:-

• For Tax payers with NIL tax liability: Full waiver of late fee.

• For tax payers having aggregate turnover with tax liability: Capping of late fee of Rs 500/-. A doubt may arise here as to whether whether this amount is only for CGST only or both CGST & SGST. Considering the press release, where it is stated that maximum late fee will be capped at Rs 500 per return it should be the total late fee i.e. CGST + SGST. This amount is considerably lower than the current maximum limit of late fee of Rs 5000/- (each for CGST & SGST) i.e. total of Rs 10,000/-.

Thus is any tax payer has not filed GSTR-3B for entire period of July,2017 to January, 2020 i.e. 31 months will have to pay a total late fee of only Rs 15,500/- as against the maximum late fee of Rs 3,10,000/- as currently applicable.

However it is important to note here that the reduced rate of late fee would apply for all GSTR-3B returns furnished between 01.07.2020 to 30.09.2020.

Further it should be noted that the above relief would be effective only after issue of Notifications in this regard.Thus before filing GSTR-3B for said periods the tax payers should wait for the Notifications.

From above it is evident that relief in late fee has been provided for all tax periods since introduction of GST regime as relief in respect of period July, 2017 to January, 2020 has been decided by GST Council in yesterday meeting. Further for period February, 2020 onwards, relief was already provided earlier as discussed supra.

Tax payers who have not filed their GSTR-3B, should make best use of this opportunity and make their slate clear.

***

A BIG THANKS to you for visiting our site and reading this article. Kindly provide your feedback on the above article in comment section below. Also please intimate about other GST issues on which you would require our team to pen down articles.

Doubts on GST may be lodged on ‘Ask GST query tab‘ under ‘Your GST queries’ tab on home page. National level GST experts will provide their reply on the matter raised at the earliest and same can be seen under ‘GST query resolved’ tab under ‘Your GST queries’ tab.

You can also subscribe to our free newsletter to always be updated on GST Law by filling the subscription form at home page.

Frah Saeed

Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.