-By CA Vipul Khandhar

1. Recommendations By 53^Rd GST Council Meeting:

T𝐡𝐞 𝐍𝐞𝐰 𝐆𝐒𝐓 𝐀𝐦𝐧𝐞𝐬𝐭𝐲 𝐒𝐜𝐡𝐞𝐦𝐞:

Waiver of interest and penalty

A new section 128A has been introduced that offers a waiver of interest and penalty on the condition that the tax amount is paid by March 31, 2025, and a notice has been issued under section 73.

CONDITIONAL WAIVER OF INTEREST OR PENALTY OR BOTH FOR DEMAND NOTICE ISSUED UNDER SECTION 73:

Applicable to Demand order u/s 73 of CGST Act, 2017 for the fiscal years 2017-18, 2018-19 and 2019-Waiver of interest and penalties subject to full tax will be paid by the gst dealer on or before 31.03.25.

Relaxation for section 16(4) of the CGST Act, 2017:

As per section 16(4) of the CGST Act, 2017 for any invoice / debit note the ITC can be claimed only up to the earlier of

Due date of filing GSTR-3B for September of next year (Till 01st October 2022)

30th November of the next year (till today) or

The date of filing of annual return

Now for the financial years 2017-18, 2018-19, 2019-20 and 2020-21 the ITC can be availed till 30th November 2021.

Interest waiver:

If You Have Paid Amount in Your GST Electronic Cash Ledger You Need Not Pay Interest on delayed filing of GSTR-3B

Many a times GST Portal Hangs and is struck on due date of filing GST Returns due to this many people are not able to file returns on time and due to the fault of the GST Portal the tax payers were paying interest and late fees. Now to mitigate the interest liability, the GST Council has given relaxation to say that when the Tax amount is deposited in GST portal through challan before due dates and the GSTR-3B is filed belatedly and the tax amount has been duly paid in the GSTR-3B , there will be no interest liability.

New GST return GSTR-1A:

A new optional facility by way of FORM GSTR-1A to facilitate the taxpayers to amend the details in FORM GSTR-1 for a tax period and/ or to declare additional details, if any, before filing of return in FORM GSTR-3B for the said tax period. This will facilitate taxpayer to add any particulars of supply of the current tax period missed out in reporting in FORM GSTR-1 of the said tax period or to amend any particulars already declared in FORM GSTR-1 of the current tax period (including those declared in IFF, for the first and second months of a quarter, if any, for quarterly taxpayers), to ensure that correct liability is auto-populated in FORM GSTR-3B.

2023-24 financial annual return filling exempt for the dealer filing of annual returns in FORM GSTR-9/9A for the FY 2023-24 may be exempted for taxpayers having aggregate annual turnover upto two crore rupees.

If tax & interest has been paid within 60 days of issuance of notice then no penalty imposable:

A common time limit for issuance of demand notices and orders in respect of demands for FY 2024-25 onwards, in cases involving charges of fraud or willful misstatement and not involving the charges of fraud or willful misstatement etc. Also, the time limit for the taxpayers to avail the benefit of reduced penalty, by paying the tax demanded along with interest, has been recommended to be increased from 30 days to 60 days.

E com operator has been given relaxation from the penal provision:

Amendment in Section 122(1B) of the CGST Act retrospectively w.e.f. 01.10.2023, so as to clarify that the said penal provision is applicable only for those e-commerce operators who are required to collect tax under section 52 of the CGST Act and not for other e-commerce operators.

Amount paid via DRC-03 has been counted against pre-deposit while filling appeal:

Amendment in Rule 142 of CGST Rules, 2017 and issuance of a circular to prescribe a mechanism for adjustment of an amount paid in respect of demand through FORM GST DRC-03 (voluntary tax payment Form for taxpayers) against the amount to be paid as pre-deposit for filing the Appeal.

Bio metric adhar card verification for the gst registration applicable all over India: the biometric-based Aadhaar authentication of registration applicants on the PAN India basis in a phased manner. This will strengthen the registration process in GST and will help in combating fraudulent input tax credit (ITC) claims made through fake invoices.

Changes in Goods GST rate: The GST Council has made the following recommendations to clarify the GST rates

1. The Council has recommended that the uniform rate of 5% IGST would apply to import of Parts, components, testing equipment, tools and tool-kits of aircrafts, irrespective of the HS classification to provide a fillip to MRO activities subject to specified conditions.
2. The Council has recommended that All milk cans (of steel, iron and aluminium) irrespective of their use would attract 12% GST
3. The Council has recommended that GST rate on ‘carton, boxes and cases of both corrugated and non-corrugated paper or paper-board’ (HS 4819 10; 4819 20) would be reduced from 18% to 12%
4. The Council has recommended that All solar cookers whether single or dual energy source, would attract 12% GST.
5. The Council has recommended amending existing entry covering Poultry keeping Machinery attracting 12% GST to specifically incorporate “parts of Poultry keeping Machinery” and to regularise past practice on ‘as is where is’ basis in view of genuine interpretational issues
6. The Council has recommended clarifying that all types of sprinklers including fire water sprinklers will attract 12% GST and to regularise the past practice on ‘as is where is’ basis in view of genuine interpretational issues
7. The Council has recommended extending IGST exemption on imports of specified items for defence forces for a further period of five years till 30th June, 2029.
8. The Council has recommended extending IGST exemption on imports of research equipment/buoys imported under the Research Moored Array for African-Asian-Australian Monsoon Analysis and Prediction (RAMA) programme subject to specified conditions
9. The Council has recommended exempting Compensation Cess on the imports in SEZ by SEZ Unit/developers for authorised operations w.e.f. 01.07.2017

Changes in service gst rates:

1. To exempt the services provided by Indian Railways to the general public, namely, the sale of platform tickets, facility of retiring rooms/waiting rooms, cloak room services, and battery-operated car services and to also exempt the Intra-Railway transactions. The issue for the past period will be regularized from October 20, 2023, to the date of issue of exemption notification in this regard.
2. To exempt GST on the services provided by Special Purpose Vehicles (SPV) to Indian Railway by way of allowing Indian Railway to use infrastructure built & owned by SPV during the concession period and maintenance services supplied by Indian Railways to SPV. The issue for the past will be regularized on ‘as is where is’ basis for the period from July 01, 2017, till the date of issue of exemption notification in this regard.

3. To create a separate entry in notification No. 12/2017- CTR dated June 28, 2017, under heading 9963 to exempt accommodation services having the value of supply of accommodation up to Rs. 20,000/- per month per person subject to the condition that the accommodation service is supplied for a minimum continuous period of 90 days. To extend similar benefits for past cases.

Other changes relating to Services

1. Co-insurance premium apportioned by the lead insurer to the co-insurer for the supply of insurance service by the lead and co-insurer to the insured in coinsurance agreements, may be declared as no supply under Schedule III of the CGST Act, 2017 and past cases may be regularized on ‘as is where is’ basis.
2. Transaction of ceding commission/re-insurance commission between insurer and re-insurer may be declared as no supply under Schedule III of CGST Act, 2017 and past cases may be regularized on ‘as is where is’ basis.
3. GST liability on reinsurance services of specified insurance schemes covered by Sr. Nos. 35 & 36 of notification No. 12/2017-CT (Rate) dated June 28, 2017, may be regularized on ‘as is where is’ basis for the period from July 01, 2017, to January 24, 2018.
4. GST liability on reinsurance services of the insurance schemes for which total premium is paid by the Government that are covered under Sr. No. 40 of notification No. 12/2017- dated June 28, 2017, may be regularized on ‘as is where is’ basis for the period from July 01, 2017, to July 26, 2018.
5. To issue a clarification that retrocession is ‘re-insurance of re-insurance’ and therefore, eligible for the exemption under Sl. No. 36A of the notification No. 12/2017-CTR dated June 28, 2017.
6. To issue a clarification that statutory collections made by the Real Estate Regulatory Authority (RERA) are exempt from GST as they fall within the scope of entry 4 of No.12/2017-CTR dated June 28, 2017.
7. To issue a clarification that further sharing of the incentive by acquiring bank with other stakeholders, where the sharing of such incentive is clearly defined under the Incentive scheme for promotion of RuPay Debit Cards and low-value BHIM-UPI transactions and is decided in the proportion and manner by NPCI in consultation with the participating banks is not taxable.

Refund of IGST paid due to revision of price in case of export:

A mechanism for claiming a refund of additional IGST paid on account of upward revision in the price of the goods subsequent to their export. This will facilitate a large number of taxpayers, who are required to pay additional IGST on account of upward revision in the price of the goods subsequent to export, in claiming a refund of such additional IGST.

Extension of Due Date for Filing FORM GSTR-4 for Composition Taxpayers:

An amendment in clause (ii) of sub-rule (1) of Rule 62 of CGST Rules, 2017 and FORM GSTR-4 to extend the due date for filing of return in FORM GSTR-4 for composition taxpayers from 30th April to 30th June following the end of the financial year. This will apply for returns for the financial year 2024-25 onwards. The same would give more time to the taxpayers who opt to pay tax under composition levy to furnish the said return.

Govt will not file appeal against favourable order in higher forum in tribunals and courts in the following cases:

The government want pursue the case in higher forum if the value of the case is lesser than the following monetary limits

Notice for the demand under Section 73 and Section 74 to have common time lines

In GST Where a case does not involve fraud, willful mis statement or suppression order can be passed within 3 years from due date of GSTR-9 where in case of frauds, misstatement and suppression the order can be passed within 5 years from due date of GSTR-9. Due to the extended period available in fraud cases (Section 74), the officers mostly invoke section 74 imposing higher penalty on taxpayers.

Pre-deposit for filling appeal limit reduced for filing GST Appeals:

Under tax laws filing of appeals comes with pre deposit condition. The Pre-deposit required as of now and the recommendation of the GST Council are as follows

For Filing appeal to appellate authority under section 107 10% of the tax due has to be paid even now, there is only reduction in maximum amount of pre deposit to be paid. But when it comes to appeal to Appellate Tribunal the rate of pre deposit has been reduced from 20% of tax amount to 10% of tax amount. This is once again a welcome move.

Time for Filing Appeals in GST Appellate Tribunal

Order 09/2019 – Central Tax dated 03^rd December 2019 was issued to state that appeal to GST Appellate Tribunal can be made within 3 months from the date on which the President or the State President, as the case may be, of the Appellate Tribunal after its constitution under section 109, enters office.

Reduction in TCS to be collected by E commerce Operators

The E commerce operators at present collect TCS under GST at the rate of 1%. This rate is now being reduced to 0.5%.

Even if you have paid tax under RCM for FY 2018-19 in current financial year you are eligible for ITC:

The Council has recommended that where the supplies are received from unregistered persons the Recipient of the supply should create a self invoice and pay tax under Reverse charge for such supplies. Even though the supply relates to older financial year the self invoice can be issued in current year and the ITC on the same can be availed.

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)