GST WEEKLY UPDATE : 46/2021-22 (13.02.2022) By CA Vipul Khandhar

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By CA Vipul Khandhar

1.Delhi Govt. issues Guidelines on issuance of SCN under GST:

a) It should be issued only after proper inquiry/investigation i.e. when the facts used are ascertained and allegations are prima fade made out;

b) It should be strictly in the format & manner prescribed under the GST Act and Rules made thereunder;

c) It should be clear on facts and legal provisions. Alleged violation of the provisions of law and other anomalies should be clearly brought out in the Show Cause Notice;

d) Copies of the documents to be submitted or compliance to be made by the noticee should be specifically mentioned in the SCN;

e) Possibility of additional evidence being needed or additional anomalies being detected should be kept open during the pendency of the proceeding and should also be mentioned in the notice itself;

f) Copies of the details giving reasons for SCN should be attached with the SCN and Proper Officer should not depend only on the drop down menus on the GSTIN portal;

g) The prima facie amount due, if any needs to be quantified and should be manifestly specified in the notice itself. Possibility of raising additional demand should be kept and mentioned in notice itself;

h) It should be clearly mentioned that whether the noticee(s) wishes to be heard in person, apart from filing a written representation, in the matter;

i) The authority to which the SCN is answerable should be specifically stated along with Ward, designation, e-mail id etc.;

j) All SCNs should be disposed off within statutory timelines.

Kerala SGST Dept has clarified on the GST applicability on the service supplied Government & Govt authorities:

Applicability of the revised rate of GST.

The revised rate applicable for the said supply is 18%.

The revised rate is applicable from the 01st day of January, 2022.

In case, where the time of supply of the work completed is on or before 31^st December, 2021, GST at pre-revised rate is applicable and in case where the time of supply of the work completed is on or after, 01st day of January, 2022, GST at the revised rate is applicable.

Description of Service

SGST rate with effect from 01.01.2022

Composite supply of works contract as defined in clause (119) of section 2 of the Kerala State Goods and Services Tax Act, 2017, supplied to a Governmental Authority or a Government Entity by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of, –

1. a historical monument, archaeological site or remains of national

importance, archaeological excavation, or antiquity specified under the

Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958);

2. canal, dam or other irrigation works;

3. pipeline, conduit or plant for (i) water supply (ii) water treatment, or (iii) sewerage treatment or disposal

Composite supply of works contract as defined in clause (119) of section 2 of the State Goods and Services Tax Act, 2017 other than that covered by items (i), (ia), (ib), (ic), (id), (ie) and (if) above, provided to a Governmental Authority or a Government Entity by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of-

1. a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession;

2. a structure meant predominantly for use as (i) an educational, (ii) a clinical, or(iii) an art or cultural establishment; or

3. a residential complex predominantly meant for self-use or the use of their employees or other persons specified in paragraph 3 of the Schedule III of the Kerala Goods and

Services Tax Act, 2017.

Explanation. — For the purposes of this item, the term business shall not include any activity or transaction undertaken by the State Government, the Central Government or any local authority in which they are engaged as public authorities

Composite supply of works contract as defined in clause (119) of section 2 of the State Goods and Services Tax Act, 2017, involving predominantly earth work (that is, constituting more than 75per cent. of the value of the

works contract) provided to a Governmental Authority or a Government Entity.

Composite supply of works contract as defined in clause (119) of section 2 of the Kerala State Goods and Services Tax Act, 2017 provided by a sub-contractor to the main contractor providing services specified in item (vii) above to a Governmental Authority or a Government Entity.

Central Government hereby revises Import policy for Moong from Free to Restricted with immediate effect:

Exim Code	Item Description	Existing Import Policy	Existing Policy Condition	Revised Import policy	Revised Policy Condition
07133190	Moong [Beans of the SPP Vigna Radiata (L.) Wilczek]	Free	Import of the item, Bill of Lading should be issued on or before 31.03.2022 and import of such consignment shall need to be cleared from Customs on or before 30.06.2022.	Restricted	—

Effect of the Notification: Import policy for Moong is revised from “Free” to “Restricted” with immediate effect.

DGFT notifies ITC (HS) 2022 to Sync with the Finance Act, 2021:

The Director-General of Foreign Trade (DGFT) has notified the Indian Trade Classification (Harmonised System) 2022 (ITC (HS) 2022) to sync with the Finance Act, 2021

DGTR for imposing countervailing duty on copper tubes, pipes from Malaysia, Thailand, Vietnam:

The commerce ministry has recommended the imposition of countervailing duty on copper tubes and pipes from Malaysia, Thailand and Vietnam for five years, a move aimed at guarding domestic players against imports that are subsidised by these countries. The ministry’s investigation arm Directorate General of Trade Remedies (DGTR) in its findings after a probe has stated that the investigation was initiated on a suo-motu basis and was notified to all interested parties.

Important Judgements & AARs:

(i) Karnataka Highcourt Decision Regarding LEASE GIVEN TO HOSTAL IS EXEMPTED UNDER GST:

(Applicant – Taghar Vasudeva Ambrish)

The service provided by the petitioner i.e., leasing out residential premises as hostel to students and working professionals is covered under Entry Entry 13 of Notification No.9/2017 dated 28.09.2017 namely ‘Services by way of renting of residential dwelling for use as residence’ issued under the the Act.

The petitioner is held to be entitled to benefit of exemption notification.”

(ii) Gujarat Highcourt Decision Regarding GST Dept. to Sanction Refund towards IGST paid on Goods exported i.e. ‘Zero Rated Supplies’:

The Gujarat High Court has directed GST Department to sanction refund towards IGST paid in respect to the goods exported i.e. ‘Zero Rated Supplies’. The petitioner, Jal Engineering invokes the extraordinary jurisdiction vested in this Court under Article 226 of the Constitution of India and seeks direction against the respondents for immediate sanction of the refund of Integrated Goods and Service Tax paid in regard to the goods exported zero rated supplies made vide Shipping Bills. It is averred that the authority has illegally withheld the refund of the petitioner and the e-mail received from ICEGATE stating that since drawback is claimed at a higher rate of refund of the petitioner, the same cannot be sanctioned under Section 54 of the Central Goods and Service Tax Act, 2017 read with Section 16 of the Integrated Goods and Service Tax Act, 2019.

The petitioner is a partnership firm and is engaged in the business of manufacture, export and supply of premium quality arrays of Gate Valve, Globe Valve, Swing Check Valve, Ball Valve, Pressure Seal Valve, Conduit Gate Valve, etc. It also is registered under the GST Act and having IEC Code. The refunds were stuck due to mismatch of invoice and shipping bills and Central Board of Excise & Customs (CBEC) vide Circular No.05 of 2018-Customs dated 23.02.2018 provided an alternative mechanism to give exporters an opportunity to rectify such errors committed in the initial stage. It envisaged an officer interface on the Customs EDI System through which the Custom Officer may verify the information furnished in GSTN and Custom EDI system and sanction refund in those cases where detail of invoice provided in GSTR-01/Table 6A are correct.

High court held that, the sanction of the refund towards the IGST paid in respect of the goods exported i.e. “zero rated supplies”, vide the shipping bills ought to have been completed as the two circumstances provided in sub clauses (a) & (b) of Clause (4) of Rule 96 of Rules, 2017 do not exist. The shipping bills, as per Rule 96, exporter once file are deemed to be an application for refund of Integrated tax paid on the exports of goods and withholding of the same is made permissible under Rule 96 (4) when read with Section 54 as specified. The court directed respondents to sanction the refund towards the IGST paid in respect to the goods exported i.e. ‘Zero Rated Supplies’ made via the Shipping Bills. Respondent authorities are also directed to pay interest, at the rate prescribed under the statute, to the petitioner on the amount of refund from 01.07.2019 within a period of six weeks from the date of receipt of a copy of this order.

Disclaimer:

This publication contains information for general guidance only. It is not intended to address the circumstances of any particular individual or entity. Although the best of endeavour has been made to provide the provisions in a simpler and accurate form, there is no substitute to detailed research with regard to the specific situation of a particular individual or entity. We do not accept any responsibility for loss incurred by any person for acting or refraining to act as a result of any matter in this publication.