Circular No.: ES/368/2020-21 12th November, 2020
To: Members of the Council
Sub: CBIC notifies special procedure for making payment of 35% as tax liability in first two month
CBIC has issued Notification No. 85/2020 – Central Tax dated 10th November, 2020 notifying that the registered persons who have opted to furnish a return for every quarter or part thereof, as the class of persons who may, in first month or second month or both months of the quarter, follow the special procedure such that the said persons may pay the tax due under proviso to sub-section (7) of section 39 of the said Act, by way of making a deposit of an amount in the electronic cash ledger equivalent to, -
35% of the tax liability paid by debiting the electronic cash ledger in the return for the preceding quarter where the return is furnished quarterly; or
the tax liability paid by debiting the electronic cash ledger in the return for the last month of the immediately preceding quarter where the return is furnished monthly:
Provided that no such amount may be required to be deposited-
a) for the first month of the quarter, where the balance in the electronic cash ledger or electronic credit ledger is adequate for the tax liability for the said month or where there is nil tax liability.
b) for the second month of the quarter, where the balance in the electronic cash ledger or electronic credit ledger is adequate for the cumulative tax liability for the first and the second month of the quarter or where there is nil tax liability.
Provided further that a registered person shall not be eligible for the said special procedure unless he has furnished the return for a complete tax period preceding such month.
This notification shall come into force w.e.f. 1st January, 2021.
Members may kindly make a note of the above.