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CMA Final · Indirect Tax Laws and Practice · Walkthrough of GSTN Portal

A taxpayer's electronic cash ledger on the GST portal shows a balance of Rs 40,000 in the IGST head, which was deposited by mistake. He has no other liability. What should he do to recover the amount?

He should file a refund application in Form GST RFD-01 on the portal to claim the balance in the electronic cash ledger. Cash ledger balance can be used to pay tax or be refunded, but it cannot be moved into the electronic credit ledger, and no automatic adjustment or officer debit note applies.

  1. AFile an application for refund of balance in the electronic cash ledger using Form GST RFD-01 on the portalCorrect
  2. BTransfer it to the electronic credit ledger by a journal entry
  3. CAdjust it against CGST liability of the next month automatically without any application
  4. DAsk the jurisdictional officer to issue a debit note

Explanation

Balance in the electronic cash ledger can be claimed as refund through the refund application (RFD-01) on the portal, or used for paying liability. Cash ledger balance cannot be converted into credit ledger balance. Cash in the IGST head can pay IGST, and cross-utilisation toward CGST is not automatic, and no debit note is issued by an officer.

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