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CA Final · Indirect Tax Laws · Payment of Tax

Kaveri Traders applies in FORM GST DRC-20 for instalments on an amount of ₹20,000 due under the GST Act. It has never defaulted and has not applied earlier. Which statement is correct under Rule 158 of the CGST Rules, 2017?

The facility cannot be allowed. Rule 158(3)(c) prohibits instalments where the amount for which the facility is sought is below twenty-five thousand rupees, and ₹20,000 is below that limit, whatever the taxpayer's compliance record.

  1. AThe facility cannot be allowed because the amount is less than ₹25,000Correct
  2. BThe facility can be allowed up to twelve instalments
  3. CThe facility can be allowed only if the jurisdictional officer reports it has no financial ability
  4. DThe facility can be allowed, but only with a minimum of two instalments

Explanation

Rule 158(3)(c) bars the instalment facility where the amount sought is less than twenty-five thousand rupees. ₹20,000 falls below this threshold, so the Commissioner cannot grant it regardless of the taxpayer's clean record. The other options invent conditions not in the rule.

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