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

Mehta Traders has Rs 40,000 IGST, Rs 10,000 CGST and Rs 8,000 SGST in its electronic credit ledger. Its output liability for the month is Rs 30,000 IGST, Rs 15,000 CGST and Rs 12,000 SGST. Using the portal's permitted utilisation order, what is the total cash payable?

No cash is payable. After using IGST credit fully against IGST liability, the Rs 10,000 balance can be split between CGST and SGST: Rs 4,000 against SGST after its own credit and Rs 6,000 against CGST, whose own credit of Rs 10,000 covers the rest. Cash payable is nil.

  1. ARs 0Correct
  2. BRs 7,000
  3. CRs 12,000
  4. DRs 17,000

Explanation

IGST credit is used first against IGST: 30,000 used, 10,000 left. Then against CGST: the 10,000 IGST balance reduces CGST to 5,000, which the CGST credit of 10,000 covers, leaving 5,000. For SGST 12,000, SGST credit of 8,000 is used and the remaining 4,000 is covered by nothing from IGST, as IGST is exhausted. That gives cash 4,000. Re-check: the order allows IGST credit against IGST, then CGST, then SGST in any order. Optimal use: IGST 10,000 balance goes to SGST (12,000 less 8,000 SGST credit = 4,000, so use 4,000 IGST), leaving 6,000 IGST for CGST, which becomes 9,000; CGST credit 10,000 covers it. Total cash is 0. Using IGST against SGST first yields nil cash.

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