PMT-01 records liability; it is not the cash balance
Rule 85 maintains the electronic liability register in GST PMT-01, with amounts payable debited and supported payments or reductions credited under the stated provisions. Sub-rule (7) requires a registered person noticing a discrepancy to communicate it to the jurisdictional officer through the common portal in PMT-04. This guide, checked on 26 October 2026, concerns liability-register reconciliation; it does not promise that a discrepancy report automatically revises a demand, grants refund or stays recovery. ICAI statutory compilation: CGST Rules 85(1)–(7).
Identify the entry and the source obligation
Under Rule 85(2), liabilities can arise from the return, an officer’s determination, the person’s own ascertainment and accruing interest. Preserve the tax head, period, source return/order and reference rather than netting unrelated entries. A duplicate debit, missing payment credit and disputed substantive demand are different problems. An accounting disagreement with an order may require the applicable remedy, not simply an arithmetic correction request.
Cash deposited is not necessarily liability discharged
Rule 85(3) links return-liability discharge to debits in the permitted credit or cash ledger, with the liability register credited accordingly, subject to the governing utilisation law. Rule 85(4) separately identifies the stated cash-ledger requirements, including reverse charge and interest, penalty and fees. A bank challan or cash-ledger credit therefore does not, by itself, establish that a particular liability was paid. Match the actual discharge references.
Keep payment and relief credits separate
Sub-rule (5) addresses reduction of demand to the extent of relief from the appellate authority, Tribunal or court. Sub-rule (6) addresses the specified penalty-reduction consequences where the stated tax, interest and penalty payments are made. Verify the actual operative relief and conditions; the rule is not a universal penalty waiver. A pending appeal and a request for reduction should not be recorded as an already granted credit.
Prepare PMT-04 with an entry-wise reconciliation
State the exact displayed entry, expected treatment, reason and source evidence. Include the relevant return/order, payment/discharge reference, ledger extract and any operative relief. Keep the submission acknowledgement and subsequent response linked to the original discrepancy. Follow the actual available portal process; this article does not invent a guaranteed menu path, automatic response deadline or a new mandatory attachment template.
Close the difference against a fresh extract
Compare the post-action register with the original entry and the supported expected balance. Remove duplicate internal records without claiming that a spreadsheet deletion itself changes the portal. Continue to monitor separately applicable payment, appeal and recovery requirements while the report is pending. The illustrations assume all liabilities, discharges and reductions expressly described as valid are legally established; they do not compute fresh tax, interest or penalty rates.
Applicable primary references
ICAI statutory compilation: CGST Rules 85(1)–(7) CBIC prescribed forms compilation: GST PMT-01 and PMT-04
Six worked illustrations
All facts and amounts below are fictional. Assumptions describe the model, not additional statutory rules.
Illustrative example 1: Basic liability roll-forward
Opening liability is ₹20,000, new valid debits ₹1,00,000 and matched discharge credits ₹90,000. Expected closing liability is ₹30,000. A displayed ₹40,000 balance differs by ₹10,000 and needs entry-level investigation; the difference alone does not identify which record is wrong.
Illustrative example 2: Deposit without discharge
A valid liability is ₹60,000 and ₹60,000 has been deposited into the cash ledger, but no corresponding liability-discharge debit has yet occurred. The assumed unpaid liability remains ₹60,000. Do not treat the cash deposit as both money available and a completed payment against the same liability.
Illustrative example 3: Payment plus operative relief
A demand debit is ₹2,00,000. Valid discharge is ₹50,000 and an operative order grants ₹40,000 of relief applicable to that demand. The supported remaining liability is ₹1,10,000. Keep the ₹50,000 payment and ₹40,000 relief as separate references rather than calling both cash payments.
Illustrative example 4: Duplicate debit investigation
A ₹75,000 liability is displayed twice and a ₹75,000 valid discharge is credited once. The displayed balance is ₹75,000; the assumed correct balance for the one valid liability is nil. The claimed correction is the duplicate ₹75,000 debit, subject to evidence and appropriate action, not a second use of the same payment.
Illustrative example 5: Cash-only component bridge
Assume valid reverse-charge tax ₹20,000, interest ₹2,000 and fee ₹500, with no other amounts. The cash-discharge requirement for these assumed components totals ₹22,500 under the relevant Rule 85(4) categories. An available ITC balance is not substituted for those specified cash payments.
Illustrative example 6: An ungranted request is not relief
A ₹1,20,000 demand has a valid ₹30,000 discharge. The taxpayer requests a further ₹25,000 reduction, which has not been granted. The existing supported remaining liability is ₹90,000; ₹65,000 is only the hypothetical result if the additional relief is later validly obtained. PMT-04 itself does not grant it.
Ten-step verification table
| Step | Action | Evidence |
|---|---|---|
| 1 | Retrieve the current PMT-01 extract | GSTIN, tax head, period and extraction date. |
| 2 | Identify the disputed entry | Exact debit/credit, reference and amount. |
| 3 | Trace the source liability | Return, ascertainment, order or interest basis. |
| 4 | Match actual discharge | Permitted ledger debit and liability credit references. |
| 5 | Separate deposits from payments | Bank challan, cash ledger and discharge trail. |
| 6 | Check any relief independently | Operative order, amount and application to the entry. |
| 7 | Recalculate the expected balance | Opening plus debits less supported credits. |
| 8 | Prepare the PMT-04 explanation | Specific difference and indexed evidence. |
| 9 | Preserve the submission trail | Acknowledgement, correspondence and pending obligations. |
| 10 | Verify closure on a fresh extract | Actual correction and no duplicate payment/credit. |
Sixteen practitioner FAQs
1. Which form maintains the liability register?
GST PMT-01 under Rule 85(1).
2. Is PMT-01 the electronic cash ledger?
No. Liability and funds available for discharge are separate records.
3. Are amounts payable debited or credited in PMT-01?
Rule 85(1) provides for debiting amounts payable.
4. Can liability arise from the taxpayer’s own ascertainment?
Rule 85(2) includes that stated source alongside officer determinations and other listed entries.
5. Does a cash deposit alone prove discharge?
No. Match the actual liability payment and ledger references.
6. Can every amount be paid with ITC merely because credit is available?
No. Apply the governing utilisation restrictions, including Rule 85(4)’s stated cash categories.
7. Does Rule 85(4) include reverse-charge amounts?
Yes, among its specified categories.
8. How is actual appellate relief reflected?
Sub-rule (5) provides reduction to the extent of relief and corresponding credit.
9. Is a pending relief request already an operative credit?
No. Distinguish requested and granted relief.
10. Does sub-rule (6) create a universal penalty waiver?
No. Establish the actual statutory and payment conditions.
11. Which form reports a noticed liability-ledger discrepancy?
PMT-04 under Rule 85(7).
12. To whom is the communication directed?
The officer exercising jurisdiction in the matter through the common portal.
13. Does filing PMT-04 automatically stay recovery?
Do not assume that; examine separately applicable legal remedies and obligations.
14. Can a spreadsheet correction change the portal register?
No. Verify the actual register outcome separately.
15. Is every disputed demand an arithmetic discrepancy?
No. The substantive order may need its appropriate remedy.
16. When is the reconciliation closed?
When a fresh extract and supporting records demonstrate the correct entry and balance without duplicated credits.
Conclusion
Reconcile GST liability debits, actual discharge and legally supported reductions before reporting an unexplained balance through PMT-04.
Sources and primary references
- ICAI statutory compilation: CGST Rules 85(1)–(7)
- CBIC prescribed forms compilation: GST PMT-01 and PMT-04
Official CGST Rules compilation: Rule 85 liability register, credits and discrepancy reporting.