GST WEEKLY UPDATE : 10/2023-24 (04.06.2023) BY CA Vipul Khandhar

-By CA Vipul Khandhar

1. Advisory on Filing of Declaration In Annexure V by Goods Transport Agency (GTA) opting to pay tax under forward charge mechanism – for filling of physical declaration:

• The GTAs, who commence business or cross registration threshold on or after 1st April, 2023, and wish to opt for payment of tax under forward charge mechanism are required to file their declaration in Annexure V for the FY 2023-24 physically before the concerned jurisdictional authority.
• The declaration may be filed within the specified time limits, as prescribed in the  No. 05/2023-Central Tax (Rate), dated. 09.05.2023.

 E-Waybill System is provisioned with following new features :2 Factor authentication:

• Factor authentication: In order to secure the e-waybill login access, 2 Factor Authentication(2FA) is enabled and kept optional. However, after couple of weeks, 2FA will be made mandatory. The users operating e-waybill system from multiple locations and with single credential are advised to create sub-users immediately.

3. Taxpayers who are above Rs.5 Crore but not enabled for e-Invoicing can get enabled voluntarily by clicking Registration -> e-Invoice Enablement.

4. GSTN enables GSTR-9 and 9C for FY 2022-23:

GSTN portal has enabled the option to file annual forms GSTR-9 and GSTR-9C for the financial year 2022-23 on the common portal. GSTR-9 is for Annual Return and GSTR-9C is Annual Reconciliation Statement The due date to file GSTR-9 and GSTR-9C for the financial year 2022-23 is December 31, 2023.

5. One person company have to separately registration in GST as a OPC:

It is advised that applicants, in the “Part B” of the GST Registration Form “REG-01,” choose the “Others” option under the “Constitution of Business” in the “Business Details” tab. If the taxpayer wishes to register for GST as a “One Person Company,” they should mention “One Person Company” in the provided text field. Following this, the applicant can proceed with the normal registration application process to complete the registration.

Documents required for GST registration of an OPC:

1. Company’s PAN card copy
2. Company registration certificate
3. Memorandum of Association / Articles of Association
4. PAN card, photo, and Aadhaar card of all directors
5. Bank details – a copy of the cancelled cheque or bank statement
6. Proof of appointment of authorized signatory – letter of authorization
7. Proof of address for the primary and secondary places of business
8. Copy of electricity bill/landline bill/water bill/municipal khata copy/property tax receipt from your own office
9. In the case of a rented office, the owner’s no-objection certificate (NOC) is required.

Step-by-step guide explaining the GST registration process online:

Step 1: Go to the GST Portal.

Step 2: Generate a Temporary Reference Number (TRN) by completing OTP validation.

Step 3: Verify OTP and generate TRN.

Step 4: Log in with the generated TRN.

Step 5: Submit business information.

Step 6: An Application Reference Number (ARN) will be generated.

Step 7: Keep track of the GST portal using the ARN and respond to any clarifications requested by the department.

Step 8: Once the application is approved by the department, the Registration Certificate (RC) along with the username and password will be sent to the registered email ID.

6. Important AAR & Judgements:

(i) Judgement of Hon’ble Highcourt Court of Andhrapradesh Regarding ASTM-10 can not be issued without authorization:

(Applicant – M/s. Sudhakar Traders)

M/s. Sudhakar Traders, Kurnool Vs. The State of Andhra Pradesh (W.P.Nos.6599 and 6601 of 2023), shed light on the importance of the Proper Officer’s authorization in issuing notices under Section 61 read with Rule 99. The Hon’ble High Court of Andhra Pradesh, in its judgment dated 25-04-2023, set aside a notice issued under Section 61 due to lack of authorization by the Proper Officer. The notice in the form of ASMT-10 was issued by a Deputy Commissioner without the required authorization as per the law.

The Court held that the 3rd respondent who issued the impugned notices is the Deputy Commissioner (ST) but not the Chief Commissioner. Therefore, in order to issue the impugned notices, the 3rd respondent requires the authorization of the Chief Commissioner assigning the task of issuing notices under Rule 99 r/w Section 61 of the Act. In the impugned notices, neither any reference is made about such authorization nor it was filed separately in the Court. Therefore, we are constrained to hold that the two impugned notices suffer the vice of lack of authorization by the Proper Officer i.e., Chief Commissioner. Therefore, the impugned notices are liable to be set aside.

Thus, notice issued under section 61 read with rule 99 CGST shall be invalid if such notice has been issued other than the Proper Officer.

The case of M/s. Sudhakar Traders highlights the significance of adhering to the authorization requirement for issuing notices under Section 61 read with Rule 99 of the CGST Act. The Court emphasized that only the Proper Officer, specifically the Chief Commissioner or an authorized officer assigned by the Chief Commissioner, can issue such notices. In the absence of proper authorization, the notices are considered invalid.

It is crucial for tax authorities to strictly adhere to the legal provisions and ensure that the Proper Officer’s authorization is obtained before issuing notices. This ensures that the scrutiny process is conducted by the designated authority, maintaining transparency and legality. By upholding the requirement for proper authorization, the court’s decision serves as a reminder to all concerned parties that the validity of a notice under Section 61 read with Rule 99 of the CGST Act is contingent upon it being issued by the authorized Proper Officer.

(ii) AAAR On 18% GST payable on open car parking sale:

(Applicant – Eden Real Estates Private Limited)

It transpires from plain reading of the above provisions of RERA that though a sanctioned plan requires inclusion of parking layout, an uncovered parking space such as open parking area is not included in the definition of “garage” but falls within the meaning of “common area”. Now the “common area” belongs to all apartment owners jointly or the owners’ association when formed and no portion can be sold/transferred/leased out to any person by the promoter. So in the instant case the sanctioned plan may have open parking spaces but the Appellant has no right to transfer ownership or lease out or allow right to use of the said spaces to allottees. The owners’ association on joint agreement of its members may lease out the open parking space on rent at a future date but that question is beyond the ambit of the current discussion. So it is clear that the consideration collected from allottees for right to use of open parking spaces will not form a part of value of composite supply as prayed for by the Appellant. The amount charged by the appellant for right to use of car/two wheeler vehicle parking space, though not permissible as per RERA, constitutes a separate supply under the GST Act and the appellant is therefore liable to pay tax @ 18% on such supply. Further, the question of one-third abatement of valuation of land for open parking space is not maintainable as the “common area” which includes such open parking space is considered in the valuation of apartment and one-third abatement on supply of construction services is being availed before levy of tax under the GST Act.

Further, it has been submitted by the appellants that their prospective buyers are given an option to opt for car parking space along with the apartment being booked by the customers and accordingly, the customers who opt for availing the car parking facility also, are charged a certain sum towards the car parking space.

So, it is evident that sale/right to use car parking service and construction services are separate services which are not dependent on sale and purchase of each other. Therefore, sale/right to use car parking is not naturally bundled with construction services and hence, it can not be treated as composite supply of construction services.

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.

(Author is a well known Chartered Accountant practicing at Ahmedabad)