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-By CA Vipul Khandhar

1. GST Rate Clarification on Popcorn – CBIC Regularises Past Disputes:

The Central Board of Indirect Taxes & Customs (CBIC) has issued a clarification to resolve disputes relating to the GST rate applicable on different categories of popcorn. The clarification follows the recommendation of the GST Council in its meeting held on 21 December 2024.

Regularization of Past Disputes

CBIC has clarified that GST rate disputes on ready-to-eat popcorn up to 14 February 2025 will be regularized on an “as is where is” basis.

This step has been taken due to genuine interpretational issues among field formations regarding the correct GST rate applicable on popcorn mixed with salt and spices.

The circular emphasizes that this clarification does not introduce any new tax liability, but merely resolves differing interpretations adopted by tax authorities in the past.

GST Rate Structure for Popcorn

The circular introduces a three-tier rate structure based on the nature and packaging of the product:

1. Salted or Spiced Popcorn (Loose Supply)

Ready-to-eat popcorn mixed with salt and spices and supplied in loose form attracts 5% GST.

Such popcorn is treated similarly to unpackaged snack food products.

2. Pre-Packaged and Labelled Popcorn

Ready-to-eat popcorn mixed with salt and spices supplied in pre-packaged and labelled form attracts 12% GST.

CBIC has clarified that such products possess the essential character of ‘namkeens’, thereby attracting the 12% rate applicable to packaged savoury snack items.

3. Sweet or Caramel Popcorn

Where popcorn is mixed with sugar (e.g., caramel popcorn), its character changes to sugar confectionery.

Accordingly, such products attract 18% GST.

Popcorn Sold in Cinema Halls

The circular also indirectly addresses confusion regarding popcorn sold in cinema theatres.

Generally, popcorn supplied independently at theatres in loose form will attract 5% GST, similar to restaurant-style supply of food items.

However, complications may arise where popcorn is sold together with cinema tickets or as part of promotional bundles.

Composite or Mixed Supply Issues

In cases where movie tickets and snacks are bundled together, the transaction may qualify as either:

• Composite supply, or
• Mixed supply

depending on the structure of the transaction.

GST implications may then align with the rate applicable to cinema tickets, which is:

• 12% GST where ticket price is below ₹100
• 18% GST where ticket price is above ₹100

Therefore, if popcorn forms part of a bundled supply linked with cinema exhibition service, the applicable GST rate may increase accordingly.

Key Takeaways

1. Past disputes on popcorn GST rates up to 14 February 2025 stand regularized.
2. A three-tier GST structure now clearly applies:
   • 5% – loose salted popcorn
   • 12% – packaged and labelled salted popcorn
   • 18% – caramel or sugar-based popcorn
3. Cinema hall sales generally remain taxable at 5% when supplied independently.

Bundled supplies with movie tickets may attract higher GST rates depending on composite supply rules.

2. GSTN Introduces Form ENR-03 for Unregistered Persons to Generate e-Way Bills:

The Goods and Services Tax Network (GSTN) has issued Important Advisory No. 584 dated 15 February 2025, introducing Form ENR-03 for enrolment of unregistered persons on the E‑Way Bill Portal. This facility has been made operational with effect from 11 February 2025.

The advisory enables unregistered dealers engaged in the movement or supply of goods to enrol on the portal and obtain a unique Enrolment ID, which can be used in place of a GSTIN for generating e-Way Bills. The introduction of Form ENR-03 is in line with Notification No. 12/2024 – Central Tax dated 10 July 2024, which provided the legal framework for such enrolment.

This development aims to enhance compliance within the e-Way Bill ecosystem by bringing certain transactions involving unregistered persons within the reporting framework.

Legal Background and Need for ENR-03

Under the Central Goods and Services Tax Act, 2017, the e-Way Bill mechanism was introduced to monitor the movement of goods valued above the prescribed threshold and to curb tax evasion.

However, practical challenges were observed where unregistered persons were involved in the movement of goods, such as:

• occasional suppliers,
• persons making exempt supplies but transporting goods,
• entities involved in transportation or job work arrangements.

Since such persons do not possess a GSTIN, difficulties arose in generating e-Way Bills when required under the rules.

To address this gap, the Government introduced Form ENR-03, allowing such persons to obtain a temporary identification number for the limited purpose of e-Way Bill generation.

Key Features of Form ENR-03

The newly introduced Form ENR-03 enables unregistered persons (URPs) to enrol themselves on the e-Way Bill portal and obtain a 15-character Enrolment ID.

Key aspects of the new system include:

1. Voluntary Enrolment Facility: Unregistered persons involved in the movement or transportation of goods can enrol on the portal using Form ENR-03.
2. Unique Enrolment ID: Upon successful enrolment, the system generates a 15-character Enrolment ID, which can be used instead of a Supplier GSTIN or Recipient GSTIN while generating e-Way Bills.
3. Access to e-Way Bill Generation: Enrolled URPs can log in to the portal and generate e-Way Bills in the same manner as registered taxpayers.
4. Improved Traceability of Goods Movement: The system ensures better monitoring and traceability of goods movement, even where the supplier or recipient is not registered under GST.

Procedure for Enrolment under Form ENR-03

1. Accessing the Enrolment Option

The enrolment facility is available on the e-Way Bill portal under:

Main Menu → Registration → Form ENR-03

This option is specifically designed for unregistered persons seeking enrolment.

2. Filling the ENR-03 Form

Upon accessing the form, the applicant is required to provide the following details:

• State selection
• Permanent Account Number (PAN)
• Type of enrolment
• Address details
• Mobile number

The PAN details are validated electronically, and the mobile number is verified through OTP authentication.

3. Creation of Login Credentials

After entering the required information, the applicant must:

• Create a username
• Check the availability of the chosen username
• Set a secure password

Once the form is successfully submitted, the system generates:

• a 15-character Enrolment ID, and
• an acknowledgment confirming successful enrolment.

This Enrolment ID serves as the unique identifier for e-Way Bill purposes.

Generation of e-Way Bills by Enrolled URPs

After obtaining the Enrolment ID, the unregistered person can log in to the portal and generate e-Way Bills.

The process involves:

1. Logging in using the created username and password.
2. Selecting the “Generate New” option under the e-Way Bill section.
3. The Enrolment ID is auto-populated as the Supplier or Recipient.
4. Entering other relevant details such as:
   • invoice or document number,
   • value of goods,
   • HSN details,
   • transporter details.
5. Completing the process to generate the e-Way Bill (EWB).

This process ensures that transactions involving unregistered persons are also captured within the GST movement reporting framework.

Practical Implications for Businesses

The introduction of Form ENR-03 has several practical implications:

1. Increased Compliance Coverage

Unregistered persons who were previously unable to generate e-Way Bills can now comply with movement reporting requirements.

2. Improved Supply Chain Transparency

Authorities can track goods movement more effectively, reducing risks of tax evasion.

3. Facilitation of Certain Transactions

The system supports situations such as:

• movement of goods by occasional suppliers,
• inter-state movement by unregistered persons, and
• movement involving job work or consignment arrangements.

4. Reduced Dependency on Registered Parties

Earlier, unregistered persons had to rely on registered suppliers or transporters to generate e-Way Bills. The new facility allows independent compliance.

Compliance Considerations

Businesses dealing with unregistered suppliers or recipients should note the following:

• URPs involved in movement of goods above the prescribed threshold may now be required to obtain ENR-03 enrolment.
• The Enrolment ID must be used in place of GSTIN in the e-Way Bill system.
• Proper documentation must be maintained to support the underlying transaction.

Failure to comply with e-Way Bill provisions may attract penalties under Section 122 of the CGST Act.

Conclusion

The introduction of Form ENR-03 by GSTN represents a significant compliance enhancement in the GST e-Way Bill ecosystem. By enabling unregistered persons to enrol and generate e-Way Bills, the system addresses practical challenges faced in goods movement involving non-registered entities.

3. Goa GST Department mandates physical verification where GST welcome letters are returned undelivered to curb fake registrations Order No.: CST/26-5/CRU/2025-26/5648 Date: 27 February 2026:

The Government of Goa has directed GST officers to undertake mandatory field verification of business premises in cases where GST welcome letters sent to newly registered taxpayers are returned undelivered by postal authorities, as such instances may indicate fake or non-genuine GST registrations created for fraudulent activities.

During verification, officers must:

• Examine documents submitted at the time of registration
• Physically inspect the declared business premises
• Conduct inquiries and record statements of persons present
• Collect supporting evidence and take photographs of the premises

GSTAT Portal modifies undertaking in appeal filing declaration following stakeholder representation:

GST – Appeals before GSTAT – Mandatory undertaking on portal – Stakeholder concerns – Declaration modified

While filing an appeal before the GSTAT, taxpayers are required to enter the ARN/CRN number of the impugned order. However, the portal earlier required the appellant to submit the following declaration before proceeding with the appeal filing:

“We hereby declare that this is our first appeal in the impugned order before the tribunal and we have previously neither filed any appeal/writ nor it is pending before any other legal forum including High Court/Supreme Court.”

PORTAL MODIFICATION

Taking cognizance of the representation and stakeholder concerns, the Ministry of Finance has revised the undertaking text on the GSTAT portal.

The modified declaration now reads:

“We hereby declare that this is our first appeal in the impugned order before the tribunal and we have previously neither filed any appeal nor it is pending before any other legal forum including High Court/Supreme Court; and that no writ petition at present is pending before any High Court / Supreme Court.”

4. AAR & Important Judgements:

(i) Hon’ble Andhra Pradesh High court decision regarding Omission of Rule 96(10) nullifies proceedings initiated thereunder; refund recovery set aside:

(Applicant – Krishna Sai Granites (India) Private Limited)

GST – Refund of IGST on exports – Recovery proceedings – Restriction under Rule 96(10) – Subsequent omission of rule – Effect of absence of saving clause

Proceedings initiated for recovery of IGST refund granted on exports on the basis of Rule 96(10) of the CGST Rules cannot continue once the rule itself stands omitted without a saving clause, as the statutory foundation for such proceedings ceases to exist. Accordingly, recovery order passed solely relying on the omitted rule is liable to be set aside.

The Andhra Pradesh High Court allowed the writ petitions and held as under:

1. Rule 96(10) stood omitted from the statutory framework with effect from 08-10-2024.
2. The amendment did not contain any saving clause preserving rights, liabilities, or proceedings initiated under the rule.
3. In the absence of such saving provision, the legal basis for proceedings initiated solely under the rule ceases to exist.
4. Since the impugned recovery order was founded entirely on Rule 96(10), once the rule itself was removed from the statute, the proceedings lost their statutory foundation.
5. The contention of the Revenue that the omission would not affect past proceedings was rejected.

RATIO DECIDENDI

Where a statutory rule forming the sole basis of proceedings is omitted without a saving clause, the proceedings initiated there under cannot survive as the statutory foundation for such action disappears.

(ii) Hon’ble Allahabad highcourt decision regarding Uploading of SCN/Order on GST portal not sufficient “communication” to trigger limitation under Section 107; effective service must satisfy Section 169:

(Applicant – Bambino Agro Industries Ltd.)

GST – Appeal – Limitation under Section 107 – Communication of order – Uploading on GST portal – Whether sufficient service

Mere uploading of a show cause notice or adjudication order on the GST common portal, even with email/SMS alerts, does not by itself constitute valid “communication” of the order so as to trigger the limitation period for filing an appeal under Section 107. Effective communication must be determined in accordance with the modes of service prescribed under Section 169.

The Allahabad High Court allowed the writ petition and held as follows:

1. The term “communicated” used in Section 107 is not defined in the statute and must be interpreted in the context of Section 169, which prescribes the permissible modes of service of notices and orders.
2. It would be over-simplistic and legally untenable to equate uploading of an order on the GST common portal with tendering or publication of the order, in the absence of any statutory deeming fiction providing that such uploading automatically amounts to service.
3. The GSTN system does not maintain an electronic trail showing whether and when the assessee actually accessed, opened, downloaded, or viewed the uploaded order.
4. There is no statutory obligation on taxpayers to access the GST portal daily, and therefore no presumption of service can be drawn merely from uploading the document on the portal.
5. Where an assessee files an appeal asserting that it is within limitation from the date of actual communication, a presumption may arise in favour of the assessee, and the burden lies upon the Revenue to prove earlier communication.
6. In cases where communication is claimed through both electronic and physical modes, the date of communication through physical/offline mode may prevail, unless the Revenue proves effective earlier communication through electronic means.
7. Therefore, effective communication must be based on actual or constructive service strictly in accordance with Section 169.

Accordingly, the Court allowed the writ petitions and set aside the adjudication orders, subject to the condition that the petitioner deposits 10% of the disputed tax within four weeks.

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.