GST WEEKLY UPDATE :36/2024-25 (08.12.2024) By CA Vipul Khandhar

-By CA Vipul Khandhar

1. Advisory on mandatory Sequential Filing of GSTR-7 Returns as per Notification No. 17/2024:

Multiple tickets have been received regarding sequential filing of return in Form GSTR-7. Taxpayers are referencing FAQs for the same, wherein “it is not mandatory” is mentioned.

To clarify, it is to inform that following changes have been introduced in the return filing process for GSTR-7 with effect from 01.11.2024 onwards.

Sequential Filing of GSTR-7:

As per Notification No. 17/2024-Central Tax, dated 27th September 2024, effective from the 01.11.2024, GSTR-7 filing has been made sequential from the October tax period. Hence, GSTR-7 return is to be filed in chronological order, beginning with the return period of October 2024. It is pertinent to mention that for a month in which no deduction have been made, deductors need to file NiL return for the same month.

2. Advisory for Biometric-Based Aadhaar Authentication and Document Verification for GST Registration Applicants of Haryana, Manipur, Meghalaya and Tripura:

This is to inform taxpayers about recent developments concerning the application process for GST registration. It is advised to keep the following key points in mind during the registration process.

1. Rule 8 of the CGST Rules, 2017 has been amended to provide that an applicant can be identified on the common portal, based on data analysis and risk parameters for Biometric-based Aadhaar Authentication and taking a photograph of the applicant along with the verification of the original copy of the documents uploaded with the application.
2. The above-said functionality has been developed by GSTN. It has been rolled out in Haryana, Manipur, Meghalaya and Tripura on 7th December 2024.
3. The said functionality also provides for the document verification and appointment booking process. After the submission of the application in Form GST REG-01, the applicant will receive either of the following links in the e-mail,

(a)A Link for OTP-based Aadhaar Authentication OR

(b)A link for booking an appointment with a message to visit a GST Suvidha Kendra (GSK) along with the details of the GSK and jurisdiction, for Biometric-based Aadhaar Authentication and document verification (the intimation e-mail)

4.If the applicant receives the link for OTP-based Aadhaar Authentication as mentioned in point 3(a), she/he can proceed with the application as per the existing process.

5. However, if the applicant receives the link as mentioned in point 3(b), she/he will be required to book the appointment to visit the designated GSK, using the link provided in the e-mail.
6. The feature of booking an appointment to visit a designated GSK is now available for the applicants of Haryana, Manipur, Meghalaya and Tripura.
7. After booking the appointment, the applicant gets the confirmation of appointment through e-mail (the appointment confirmation e-mail), she/he will be able to visit the designated GSK as per the chosen schedule.
8. At the time of the visit of GSK, the applicant is required to carry the following details/documents

(a)a copy (hard/soft) of the appointment confirmation e-mail

(b)the details of jurisdiction as mentioned in the intimation e-mail

(c)Aadhaar Card and PAN Card (Original Copies)

(d)the original documents that were uploaded with the application, as communicated by the intimation e-mail.

9. The biometric authentication and document verification will be done at the GSK, for all the required individuals as per the GST application Form REG-01.
10. The applicant is required to choose an appointment for the biometric verification during the maximum permissible period for the application as indicated in the intimation e-mail. In such cases, ARNs will be generated once the Biometric-based Aadhaar Authentication process and document verification are completed.
11. The operation days and hours of GSKs will be as per the guidelines provided by the administration in your state.

3. Invoice management system :Advisory

If you can’t see your GSTR2B or there is a difference between 2A and 2B, please compute your new GSTR2B from IMS dashboard after taking any action on the existing records

On a supplier uploads or saves an invoice in GSTR-1, IFF, or GSTR-1A, the details of that invoice are immediately reflected in the recipient’s IMS dashboard. The recipient can then take one of three actions:

Accept the invoice, making it eligible for ITC and including it in GSTR-2B.

Reject the invoice, excluding it from ITC eligibility.

Keep Pending, which defers action and the ITC claim to subsequent months.

Only invoices accepted by the recipient will be considered as eligible ITC in their GSTR- 2B.

Recipient end: If the recipient doesn’t take any action on an invoice, it will be treated as deemed accepted and automatically included in GSTR-2B as an accepted invoice eligible for ITC. This ensures smooth processing even if the recipient forgets to act.

IMS to be filed between 14 th of the month & before filling ofGSTR-3B.:A draft GSTR-2B will be available to recipients on the 14th of the subsequent month, just like the current process.

However, recipients can continue to accept, reject, or keep invoices pending in IMS even after GSTR-2B is generated up until the filing of GSTR-3B.

If a supplier amends an invoice in GSTR-1A, the updated invoice details will be reflected in the recipient’s IMS dashboard. However, the amended invoice ITC will only appear in the recipient’s GSTR-2B of the subsequent month. Suppliers can also track the actions their recipients have taken on these invoices in the IMS.

For taxpayers under the Quarterly Return and Monthly Payment (QRMP) scheme: Invoices uploaded via IFF will appear in the recipient’s IMS dashboard.

If a taxpayer fails to file their GSTR-3B for a particular month, the GSTR-2B for the subsequent month will not be generated. This ensures compliance with filing timelines and prevents delays in ITC claims.

4. AAR & Important Judgements:

(i) AAR On IGST Input Tax Credit not allowed if Bill of entry not in the name of Buyer:

(Applicant – R.V Hydraulic Services)

The GST AAR ruled that M/s RV Hydraulic Services is not eligible to claim ITC on IGST paid for the imported machinery as the Bill of Entry was not issued in their name.

Implications of the Ruling:

This ruling highlights the critical importance of documentation in GST compliance, particularly for imports. Businesses must ensure that: Bills of Entry for imported goods are made out in their name. All conditions under Section 16 of the CGST Act are fulfilled to claim ITC.

Conclusion:The advance ruling reiterates the procedural rigor required under GST laws. Businesses engaging in imports must scrutinize their documentation to avoid potential ITC denial due to procedural lapses. This decision sets a precedent emphasizing that ownership and documentation play a pivotal role in determining ITC eligibility for imported goods.

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.

(The Author is a well known Chartered Accountant practicing in the fields of direct and indirect taxes)