The Ministry of Finance has issued a notification for GST-registered taxpayers who have not yet filed their annual reconciliation statement through the GSTR-9C form. According to the circular, eligible taxpayers now have the opportunity to waive pending late fees for GSTR-9C filings for FY 2017-18 to FY 2022-23. However, to avail of this waiver, the pending GSTR-9C must be filed by March 31, 2025.
The original deadline for filing both GSTR-9 and GSTR-9C for any given financial year is December 31. While it is possible to file the GSTR-9 annual return without submitting GSTR-9C, the law advises that both returns be filed together. This notification applies to taxpayers who did not follow this recommendation and failed to file the GSTR-9C.
The Finance Ministry stated regarding the waiver of late fees for filing GSTR-9C after the deadline:
“On the recommendations of the Council, the Central Government has waived the late fees for the financial years 2017-18, 2019-20, 2020-21, 2021-22, and 2022-23, which exceed the amount payable under Section 47 up to the date of filing FORM GSTR-9 for the respective year. This applies to registered persons who were required to file the GSTR-9C reconciliation statement with the GSTR-9 annual return but failed to do so. They can now submit the GSTR-9C by March 31, 2025. However, no refund will be granted for late fees already paid.”
Chartered Accountant Deep Koradia explains, “The recent notification waives the late fees for filing GSTR-9C. If a taxpayer has filed GSTR-9 by the deadline, no late fees will be charged for GSTR-9C (for FY 2017-18 to 2022-23). If GSTR-9 was filed after the deadline but the late fees were paid, no separate late fees will be levied for GSTR-9C. In the past, the GST department issued show cause notices (SCNs) for non-payment of late fees for late GSTR-9C filings. Now, taxpayers can respond to these SCNs, requesting the GST officer to drop the case and provide relief from late fees. However, if late fees for GSTR-9C have already been paid, refunds will not be issued.”
Last Chance to Avoid GST Scrutiny: File Pending GSTR-9C by March 31, 2025
Chartered Accountant Bimal Jain, founder of A2Z Taxcorp, warns, “If a GST-registered individual misses this final opportunity to file the GSTR-9C return, after submitting GSTR-1 and GSTR-3B returns with due reconciliation to GSTR-2A/GSTR-2B, the department may initiate scrutiny of GST returns, audits, and inspections. This could lead to proceedings for discrepancies in outward supplies, tax liabilities, GST credit, reverse charge mechanism (RCM) liabilities, and the issuance of a show cause notice under section 73 (non-fraud) or section 74 (fraud), depending on the case.”
Jain further emphasizes the importance of GSTR-9C: “The GSTR-9C is a self-certified reconciliation statement that acts as a verification tool for GST authorities to ensure the accuracy of the returns filed by taxpayers. Failure to file it could be seen as an attempt to suppress information, misstate figures, or commit fraud to evade taxes.”
Sivakumar Ramjee, Executive Director of Indirect Tax at Nangia Andersen LLP, states, “The late fees exceeding the amount payable under Section 47 of the CGST Act have been waived for taxpayers who file their pending FORM GSTR-9C by March 31, 2025. However, it is important to note that taxpayers who have already voluntarily paid the late fee will not be eligible for a refund. Taxpayers are advised to file their outstanding GSTR-9C reconciliation statements by the deadline to take advantage of this waiver. The aim is to simplify compliance and encourage timely filing of reconciliation statements. It is highly recommended that taxpayers seize this opportunity to avoid additional penalties and ensure compliance with GST regulations.”
Kulraj Ashpnani, Partner at Dhruva Advisors LLP, explains, “Failure to file GSTR-9C can initially lead to a notice being issued, requiring the taxpayer to file within a specified timeline. Non-compliance may also result in late fees and penalties. Furthermore, GST audit or assessment proceedings could be initiated against the taxpayer, with the department potentially raising allegations of fraud and suppression.”
Who Needs to File GSTR-9C and GSTR-9?
Jain explains that the requirement to file GSTR-9C depends on the aggregate turnover of a taxpayer in a given financial year. The threshold limits and filing requirements for GSTR-9C have evolved over time. Here’s a breakdown by financial year:
| Financial Year | Aggregate Turnover Threshold for GSTR-9C Filing | Certification Requirement |
|---|---|---|
| 2017-18 | Above Rs 2 crore | Mandatory |
| 2018-19 | Above Rs 5 crore | Mandatory |
| 2019-20 | Above Rs 5 crore | Mandatory |
| 2020-21 | Above Rs 5 crore | Self-certification |
| 2021-22 | Above Rs 5 crore | Self-certification |
| 2022-23 | Above Rs 5 crore | Self-certification |
- 2017-18: Taxpayers with an aggregate turnover exceeding Rs 2 crore were required to file GSTR-9C, which had to be certified by a Chartered Accountant (CA) or Cost Accountant (CMA).
- 2018-19 and 2019-20: The threshold for mandatory GSTR-9C filing was raised to Rs 5 crore. Certification by a CA or Cost Accountant remained mandatory.
- 2020-21 onwards: The threshold limit remained at Rs 5 crore, but the requirement for certification by a CA or Cost Accountant was removed. Taxpayers could self-certify the GSTR-9C form.
Ashpnani from Dhruva Advisors LLP explains, “Under the GST regime, all registered persons, except Input Service Distributors, those liable to deduct TDS/TCS, casual taxable persons, and non-resident taxable persons, must file an annual return in Form GSTR-9 and a self-certified reconciliation statement in Form GSTR-9C by December 31 of the following financial year. The threshold for filing GSTR-9 is an aggregate turnover of Rs 2 crore (PAN India), while for GSTR-9C, it is Rs 5 crore.”
What is the Purpose of Filing GSTR-9C?
Ramjee explains, “Filing GSTR-9C, the reconciliation statement, along with the GSTR-9 annual return, is essential under India’s Goods and Services Tax (GST) laws for taxpayers with an aggregate turnover exceeding Rs 5 crore in a financial year. GSTR-9C is mandatory under Section 44(2) of the CGST Act, 2017, for such taxpayers. It reconciles the figures reported in GSTR-9 with the taxpayer’s audited financial statements, helping to identify discrepancies and ensuring the accuracy of GST declarations.
Failure to file GSTR-9C can result in penalties under Section 125 of the CGST Act, which can amount to up to ₹25,000 for non-compliance. State GST laws may impose similar penalties, further increasing the financial burden. Late filing of GSTR-9C incurs a late fee, adding to the taxpayer’s liability. Non-filing or incorrect filing may trigger scrutiny, audits, or even investigations by GST authorities, leading to extended compliance procedures.”
Source: The Economic Times
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