PAYMENT OF TAXCentral

Section 53 of The Central Goods and Services Tax Act, 2017 in hindi

On utilisation of input tax credit availed under this Act for payment of tax dues under the Integrated Goods and Services Tax Act in accordance with the provisions of sub-section (5) of section 49, as reflected in the valid return furnished under sub-section (1) of section 39, the amount collected as central tax shall stand reduced by an amount equal to such credit so utilised and the Central Government shall transfer an amount equal to the amount so reduced from the central tax account to the integrated tax account in such manner and within such time as may be prescribed.

Summary

The most important thing this provision does is require the central government to transfer money to the integrated tax account when a taxpayer uses central tax credit to pay integrated tax dues.
This process happens when a valid return shows that input tax credit from central tax was used to pay the integrated tax.
The collected central tax amount is officially reduced by the exact amount of the credit used.
The government handles the transfer in a specific manner and timeframe that gets prescribed in the rules.

Practical examples

1A business owes fifty thousand rupees in integrated tax and uses its existing central tax credit to cover the bill. The central government then shifts fifty thousand rupees from its central tax account over to the integrated tax account behind the scenes.

2A shopkeeper pays her integrated tax liability using central tax credits she saved from previous purchases. The government adjusts its own internal accounts to reflect this cross-payment.

FAQ

1. What triggers a funds transfer under Section 53 of The Central Goods and Services Tax Act, 2017?

A transfer is triggered when a taxpayer uses their availed input tax credit from the central tax to pay off their integrated tax dues in their valid return.

2. Who performs the transfer of funds under Section 53 of the CGST Act?

The Central Government is responsible for transferring the equal amount from the central tax account to the integrated tax account.

3. Does the taxpayer's central tax liability increase under Section 53 of the tax law?

No, the amount collected as central tax actually stands reduced by the amount of credit utilized for the integrated tax payment.

Test yourself

Q1.Under Section 53 of The Central Goods and Services Tax Act, 2017, when a taxpayer uses central tax input credit to pay integrated tax, which two government accounts are involved in the resulting transfer?

Q2.According to Section 53 of the CGST Act, what document must reflect the utilization of the input tax credit before the government transfers the money?

Q3.Based on Section 53 of the central tax law, what happens to the total amount collected as central tax when this credit is utilized?

Q4.Under Section 53 of The Central Goods and Services Tax Act, 2017, who is legally obligated to execute the transfer of funds between the accounts?

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