By Vipul Khandhar , CA
1. Implementation of at least 6 digit HSN in e-Invoices and e-Way bills has been deferred:
As per a recent Update issued by the GST E-invoice/ E-way Bill system dated September 30, 2023 stated that the Implementation of at least 6 digit HSN in e-Invoices and e-Waybills has been deferred.
2. GST changes effective w.e.f. 01.10.2023:
A. Now dealer supplying goods to e commerce company can opt for composition levy:
The registered person engaged in supplying goods through an E-commerce operator (“ECO”) shall now be extended to them. However, restrictions will continue to apply for such registered persons who are engaged in the supply of services through an E-commerce operator.
- The procedure is as hereunder:
I. The ECO is prohibited from allowing any inter-state supply of goods through its platform by the said
II. The ECO shall allow the supply of goods through it by the said person only if an enrolment number has been allotted on the common portal to the said person;
III. The ECO must collect tax at source under subsection (1) of Section 52 of the CGST Act for the supplies of goods made by the said person through its platform.
IV. The ECO is required to electronically submit the details of supplies of goods made by the said person through its platform in the statement in FORM GSTR-8.
B. If dealer has not made payment of purchase bill, within 180 days then it has to be reversed with interest as per new provision:
The liability of interest on such reversal shall be determined in accordance with Section 50(3) instead of 50(1) of the CGST Act, only when such wrongly availed credit is utilised by the registered person.
C. Transfer of goods to bonded warehouse has been treated as exempt supply for the reversal of common ITC u/s 17(2) and (3) r.w. Rule 42/43
This change will be in respect to para 8(a) of Schedule III of the CGST Act, which includes the supply of warehoused goods to any person before clearance for home consumption within the meaning of exempted supply for the purpose of reversal of common ITC under Section 17(2) and (3) read with Rule 42 and 43 of the CGST Rules.
D. No ITC on the purchase of goods & service for providing Corporate social responsibility fund.
There would be restrictions on ITC on goods/services received by taxable person, that are used or intended to be used for activities associated with fulfilling Corporate Social Responsibility (“CSR”) obligations. This is applicable prospectively.
E. No GST registration require by the suppler who engaged in supply under reverse charge or having agreegate turnover less then RS.20Lacs. w.e.f. July 2017
This change will be having a retrospective effect from July 01, 2017, granting an exemption to person from taking registration in GST as per Section 22(1) of the CGST Act and compulsory registration under Section 24 of the CGST Act, from taking GST registration.
F. Time limit on application for revocation of cancelled registration has been increased from 30 days to 90 days on request to commissioner up to 180 days.
G. The registered person has not been allowed to furnish belated returns in Form GSTR-1, GSTR-3B, GSTR-8, GSTR-9 and GSTR-9C after the expiry of three years from the due date of furnishing the relevant returns.
H. Now department has been liable for the interest on delay refund of exporter ITC refund.
I. Monetary limit for prosecution has been increased:
Further, this amendment will increase the limit for launching prosecution from INR 1 Crore to INR 2 Crores except for the offence of issuance of invoice without supply of goods or services.
Thus, in case of offences, other than fake invoices, prosecution provisions to be initiated if the value of taxes is more than Rs. 2 Crores and for fake invoices, the prosecution will continue as for the threshold tax amount of Rs. 1 Crore.
J. Comunding of offence has not been allowed to the person who involved in:Fake/bogus invoice cases are excluded from the option of compounding of offences.Further compounding fees minimum 25 % of tax involved & maximum 100% of tax amount involved has been defined.
K . Now GST portal allow sharing of information on the basis of consent of the registered person.
L. Now ‘Non-taxable online recipient’ receive service of OIDAR service has been liable for the gst under RCM provision w.e.f. 01.10.2023.
M. Place of Supply in relation of Transportation of Goods
Under Section 13(9) of the IGST Act, 2017, which provides the place of supply of services in case of transportation of goods, other than by way of mail or courier would be covered under the default provision of Section 13(2) of IGST Act and would be the location of the recipient of services, in cases where either the supplier of services or recipient of services is located outside India. As a result, Services to recipients outside India would qualify as exports, and Services from suppliers outside India would qualify as import of service irrespective of the destination of goods.
N. Now onwards Zero-rated supplies to SEZ for authorised operations only.: other then authorized supply is liable for the IGST.
Only the supplies made for authorised operations to SEZ unit or developer shall qualify as zero-rated supplies.
O. IGST Zero-rated supplies(export) not permitted with payment of IGST until notified
No notification has been issued permitting supplies to SEZ units/developers with payment of IGST. Hence, the default route of LUT without payment of IGST would only be available.
3. AAR & Important Decisions:
(i) AAR On ITC eligible on input used for machinery foundation construction:
(Applicant – M/s Uvee Glass Private Limited)
The recent decision by the Advance Authority of Ruling (AAR) in Rajasthan has shed light on an important aspect concerning the Input Tax Credit (ITC) of GST. Specifically, the case pertained to the ITC eligibility on GST paid for constructing foundations for machinery.
The AAR, Rajasthan, in M/s. Uvee Glass Private Limited [Advance Ruling No: RAJ/AAR/2023-24/05 dated June 30, 2023] held that, Input Tax Credit (“ITC”) of GST paid on the inward supply for fixing of plant and machinery to earth by foundation or structural support which is used for making outward supply of taxable goods is allowed.
DisclaimerThis 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.
( The author is a well known chartered accountant practicing at Ahmedabad )