Cases where tax payment has been made through FORM GSTR 3B prior to the issuance of demand notice and/or adjudication order before the date 01.112024, shall also be eligible for benefit under section 128A of the CGST Act
The Issue:
The issue concerns whether taxpayers who have paid tax through FORM GSTR-3B instead of FORM GST DRC-03, before the notification of Section 128A of the CGST Act (i.e., before 1st November 2024), are eligible to claim benefits under this section.
Representations were received from taxpayers seeking clarification on whether payments made via FORM GSTR-3B before the enforcement of Section 128A can be considered as valid payments for availing benefits under the new provision.
Examination of the Issue:
The matter was examined in light of Circular No. 238/32/2024-GST dated 15th October 2024. The circular clarified that any amount paid towards the tax demand before the enforcement date of Section 128A (i.e., before 1st November 2024) would be treated as valid payment under sub-section (1) of Section 128A. However, it is essential that such payments were made before 1st November 2024 and were specifically intended to clear the tax demand.
Clarification:
Vide Circular No. 248/05/2025-GST dated 27th March 2025, the Central Board of Indirect Taxes and Customs has clarified that the cases where the payment of tax has been made through FORM GSTR 3B prior to the issuance of demand notice and/or adjudication order before the date 1st November 2024, shall also be eligible for benefit under section 128A of the CGST Act, subject to verification by the proper officer.
Another Issue:
Whether:
(i) the entire amount of tax demanded is required to be discharged and
(ii) the appeal is required to be withdrawn for the entire period, where notices/statements/orders issued to taxpayers, pertains to period covered partially under Section 128A and partially by those outside it.
In cases where the notice/statement or order etc. pertains to the period partially covered under section 128A and partially beyond the said period, Rule 164 (4) and proviso to Rule 164(7) have been amended to allow the taxpayer to file an application under FORM SPL-01 or FORM SPL-02 as the case may be after making payment of his tax liability for the periods covered under section 128A. The taxpayer after filing FORM SPL-01 or FORM SPL-02 as the case may, shall intimate the appellate authority or Tribunal his intent to avail the benefit of Section 128A and that he does not intend to pursue the appeal for the period covered under the said Section i.e. FY 2017-18 to 2019-20. The Appellate Authority or Appellate Tribunal as the case may, shall after taking note of the said request, pass such order for the period other than that mentioned in the said sub-section, as it thinks just and proper. Clarification issued vide point 6 of the Table at para 4 of circular No. 238/32/2024-GST dated 15th October 2024 is accordingly withdrawn.
