Late Fee Waiver on GSTR-9C Filing: CBIC Notification No. 08/2025 Central Tax.

The Central Board of Indirect Taxes and Customs (CBIC), under the Ministry of Finance, has recently issued Notification No. 08/2025-Central Tax, dated January 23, 2025. This notification brings significant relief to taxpayers by waiving the late fee for the delayed furnishing of the reconciliation statement in FORM GSTR-9C for specific financial years. Below, we analyze the key aspects of this notification and its implications for taxpayers.

Section 44 of the Central Goods and Services Tax (CGST) Act, 2017 mandates the filing of an annual return in FORM GSTR-9. Certain classes of taxpayers, especially those with turnovers exceeding specified thresholds, (2Cr) are also required to furnish a reconciliation statement in FORM GSTR-9C, especially those with turnovers exceeding specified thresholds, (5Cr). Failure to timely file these forms has historically attracted late fees under Section 47 of the CGST Act, 2017.

The late fees have been a significant burden for taxpayers who faced delays in compliance due to various reasons, including the complexity of reconciliation requirements and technological challenges during the initial years of GST implementation. Recognizing this, the CBIC has introduced a waiver for excess late fees pertaining to the reconciliation statement.

Key Provisions of the Notification

Scope of Waiver: The notification waives the excess late fee referred to in Section 47 of the CGST Act, 2017, for the delayed furnishing of the reconciliation statement in FORM GSTR-9C for the financial years:

2017-18, 2018-19, 2019-20, 2020-21, 2021-22, 2022-23.

Conditions for Waiver:

The waiver applies only to the portion of the late fee exceeding the amount payable under Section 47 of the CGST Act up to the date of furnishing FORM GSTR-9 for the respective financial year.

Taxpayers must furnish the delayed FORM GSTR-9C on or before March 31, 2025.

No Refund for Previously Paid Late Fees:

The notification explicitly states that any late fee already paid for the delayed furnishing of FORM GSTR-9C will not be refunded. This ensures that the waiver is prospective and does not entail additional revenue implications for the government.

Applicability:

The waiver is specifically targeted at taxpayers who were required to furnish both the annual return (FORM GSTR-9) and the reconciliation statement (FORM GSTR-9C) but failed to file FORM GSTR-9C alongside FORM GSTR-9.

Implications for Taxpayers

Relief for Non-Compliant Taxpayers: The waiver provides substantial relief to taxpayers who missed filing their reconciliation statements within the stipulated timelines. With the extended deadline of March 31, 2025, taxpayers now have a final opportunity to comply without incurring excessive penalties.

Encouragement for Compliance: By addressing the financial burden of late fees, the notification incentivizes taxpayers to regularize their compliance. This aligns with the government’s objective of improving compliance rates under GST.

Focus on Reconciliation: Taxpayers should utilize this opportunity to ensure accurate reconciliation of their financial records with GST returns for the specified years. Errors or discrepancies in reconciliation could still invite scrutiny or penalties under other provisions of the CGST Act.

No Retrospective Benefits: The clarification regarding the non-refund of previously paid late fees ensures fairness by limiting the benefit to taxpayers who were unable to comply earlier but now wish to regularize their filings.

Practical Steps for Taxpayers

Identify Non-Compliant Periods: Review compliance records to identify any pending reconciliation statements in FORM GSTR-9C for the financial years 2017-18 to 2022-23.

File Pending Forms: Ensure that both the annual return (FORM GSTR-9) and the reconciliation statement (FORM GSTR-9C) are filed before March 31, 2025.

Seek Professional Assistance: Engage tax professionals or consultants to verify data accuracy and avoid errors in reconciliation.

The evolution of Annual Returns over the years

Section 44. Annual return.

(1) Every registered person,

other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person, shall furnish an annual return for every financial year electronically in such form and manner as may be prescribed on or before the thirty-first day of December following the end of such financial year.

 Provided that the Commissioner may, on the recommendations of the Council and for reasons to be recorded in writing, by notification, extend the time limit for furnishing the annual return for such class of registered persons as may be specified therein:

Provided further that any extension of time limit notified by the Commissioner of State tax or the Commissioner of Union territory tax shall be deemed to be notified by the Commissioner.

(2) Every registered person

who is required to get his accounts audited in accordance with the provisions of sub-section (5) of section 35 shall furnish, electronically, the annual return under sub-section (1) along with a copy of the audited annual accounts and a reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year with the audited annual financial statement, and such other particulars as may be prescribed. 

35(5) Every registered person ( 1.7.17 to 31.7.21) whose turnover during a financial year exceeds the prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant and shall submit a copy of the audited annual accounts, the reconciliation statement under sub-section (2) of section 44 and such other documents in such form and manner as may be prescribed.

Wef 01.08.2021 vide Notification no.29/2021- central tax dated 30.07.2021 Section 44 was substituted as follows:

Section 44. Annual return. -

[(1)] Every registered person,

other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person shall furnish an annual return which may include a self-certified reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year, with the audited annual financial statement for every financial year electronically, within such time and in such form and in such manner as may be prescribed:

Provided that the Commissioner may, on the recommendations of the Council, by notification, exempt any class of registered persons from filing annual return under this section:

 Rule 80. Annual return.- ( 1.7.17 to 31.7.21)

(1) Every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person, shall furnish an annual return as specified under sub-section (1) of section 44 electronically in FORM GSTR-9 through the common portal either directly or through a Facilitation Centre notified by the Commissioner:

Provided that a person paying tax under section 10 shall furnish the annual return in FORM GSTR-9A.

(2) xxxxxxxxxxxxxxx .

For FY 2017-18

(3) Every registered person [other than those referred to in the proviso to sub-section(5) of section 35, ] whose aggregate turn over during a financial year exceeds two crore rupees shall get his accounts audited as specified under sub-section (5) of section 35 and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in FORM GSTR-9C, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.

For FY 2018-19 and 2019-20

[ Provided that for the financial year 2018-2019 and 2019-2020, every registered person whose aggregate turnover exceeds five crore rupees shall get his accounts audited as specified under sub-section (5) of section 35 and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in FORM GSTR-9C for the said financial year, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.

RULE 80 ( WEF 1.8.21)

(1) Every registered person, other than those referred to in the second proviso to section 44, an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and anon-resident taxable person, shall furnish an annual return for every financial year as specified under section 44 electronically in FORM GSTR-9 on or before the thirty-first day of December following the end of such financial year through the common portal either directly or through a Facilitation Centre notified by the Commissioner:

Provided that a person paying tax under section 10 shall furnish the annual return in FORM GSTR-9A .

2[(1A) Notwithstanding anything contained in sub-rule (1), for the financial year 2020-2021 the said annual return shall be furnished on or before the twenty-eighth day of February, 2022.

(2) Every electronic commerce operator required to collect tax at source under section 52 shall furnish annual statement referred to in sub-section (5) of the said section in FORM GSTR -9B .

 (3) Every registered person,

other than those referred to in the second proviso to section 44, an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person, whose aggregate turnover during a financial year exceeds five crore rupees, shall also furnish a self-certified reconciliation statement as specified under section 44 in FORM GSTR-9C along with the annual return referred to in sub-rule (1), on or before the thirty-first day of December following the end of such financial year, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.]

2[(3A) Notwithstanding anything contained in sub-rule (3), for the financial year 2020-2021 the said self-certified reconciliation statement shall be furnished along with the said annual return on or before the twenty-eighth day of February, 2022.]

Analysis

1. Till 31.7.21 there was a requirement of getting the books audited u/s 35(5) and filing of the reconciliation statement with the audited accounts was mandated as per Section 44 (2)

2. However wef 1.8.21 the requirement of getting the books audited u/s 35(5) has been done away with and a self certified reconciliation statement was to be included.

3. Wef 1.8.21 as per the substituted Rule 80(3) self certified reconciliation statement has to be furnished along with the reconciliation statement.

Frequently Asked Questions (FAQ) on Late Fee Waiver for GSTR-9C Filing - CBIC Notification No. 08/2025-Central Tax

Q1: Whether GSTR9 includes GSTR 9C?

Reply : Going by the above provisions Gstr 9 includes GSTR9C ( where notified ) as per Section 44(2) of the CGST Act, 2017 till 31.7.21 and Section 44(1) wef 1.8.21 read with Rule 80 as amended.

Q2 : I have already filed the GSTR9 for 21-22 on 31st December 22 but as there was confusion regarding applicability of GSTR 9C, If I don’t file it at all. Are there are any consequences now?

Reply : If a RTP files only GSTR9 where 9C is also applicable, filing of GSTR9 is not complete till 9C is filed as Section 44 read with Rule 80 mandates filing of both wherever GSTR9C is applicable. Therefore if the same is not filed within 31.3.25 late fees of GSTR9 will get extended from the date of filing of GSTR9 to the actual filing of GSTR9C after 31.3.25.

 Q3 : So in the above scenario if I file the GSTR9C for 21 -22 on 8th August 25, then will I have to pay late fees?

Reply : As the tax payer has filed GSTR9C after 31st 31st March 25, then late fees from 31st December 22 ( date of filing of GSTR9) to 8th August 25 will be applicable for delay in filing of GSTR 9 for 21-22 as the filing of GSTR9 within due will not be considered to be complete. Hence late fee as per 47 will be applicable till the date of filing of 9C even if 9 is filed within due date as the tax payer has not filed the GSTR9C within 31st March 25. Therefore if all such GSTR9Cs are filed within 31st March 25, no further late fees will be payable.

Q4 RPL had filed its GSTR 9 for 22-23 on 30th December 23 but filed its GSTR9C only 29th November 24. Will he be liable to pay any late fees U/s 47?

Reply : For FY 17 18 to 22 23, where GSTR 9 is filed within due no late fee will be applicable even if GSTR9C is filed after the due date. Here since the GSTR 9C is already filed even though belatedly no further late fees is payable for delay in filing of GSTR9 ( as it is considered that GSTR9C is a part of GSTR9 only)

Q5 Hasi Private Limited filed its GSTR9 for 2019-20 on 9th January 21 and GSTR 9C on 12th March 21. Will it have to pay late fee for both the delays - 9 days for GSTR9 and 71 days for GSTR9C

Reply : For FY 17 18 to 22 23 where both GSTR 9 and 9C are filed after due date but within 31st March 25, late fees will be applicable only for GSTR 9 and that too till the date of filing of GSTR9. There is no separate late fee for delay in filing of GSTR9C only the period of delay is to be computed till filing of GSTR9C. However for the period FY 17-18 to 22-23 late fee for the additional period of delay between filing of GSTR9 and GSTR9C is waived.

Q6 I have filed the GSTR9 with or without late fees but have not filed the GSTR9C for any financial year during FY 17-18 to 22-23. Now if I file the GSTR9C within 31st March 25, will I need to pay any late fees.

REPLY In case GSTR 9 is already filed with or without late fees but GSTR9C is not filed then one time opportunity of filling for 17 18 to 22 23 is given till 31.3.25 without any late fees for filing GSTR9C without any late fees.

Q7 For FY 23-24 onwards how will the late fee be computed ?

Reply : From FY 23-24 onwards late fees for GSTR9 will be considered till date of filing of GSTR9C wherever GSTR9C is applicable. However only late fees for delay in filing of GSTR 9 will be payable as it will be considered that GSTR9 is filed only the self certified reconciliation statement is also filed by the taxpayer along with GSTR9 wherever it is applicable.

Q8. I have a demand for late fees for filing GSTR9C belatedly for 17-18 to 22-23 even though my GSTR9 was filed within due date or filed after due date with late fees. I have not filed appeal against it. Will I need to pay the same?

 Reply : As the notification has waived the late fees for all situations where GSTR 9C is filed on or before 31st March 2025 beyond whatever late fees is payable for GSTR9, the demand in this case will no longer be due. For taxpayers in appeal they can cite this notification to get the relief. Though for cases where appeal is not filed we are expecting that it will be clarified in the days to come. In my considered view, just like the cases of Section 16(5) here also rectification applications could be allowed to remove the demand from the demand registers which maybe an impediment for taxpayers who are filing refunds.

Conclusion

Notification No. 08/2025-Central Tax is a proactive step by the CBIC to facilitate ease of compliance for taxpayers and address the challenges faced during the initial years of GST implementation. By waiving excessive late fees for delayed filing of reconciliation statements, the government has extended an olive branch to taxpayers, encouraging them to regularize their filings without undue financial burden. Taxpayers should act promptly to leverage this opportunity and ensure compliance within the extended timeline.

As a senior tax consultant and Managing Director of BRQ Associates, I strongly recommend all eligible taxpayers to review their compliance history, take necessary corrective actions, and avoid last-minute rushes. For further guidance, feel free to reach out to our team at BRQ Associates, Kasaragod, Kerala.