GST WEEKLY UPDATE : 30/2022-23 (23.10.2022) By CA Vipul Khandhar

By CA Vipul Khandhar

1. GSTN issued Advisory on implementation of mandatory mentioning of HSN codes in GSTR-1 w.e.f October-2022 return:

(Not No. 78/2020 – Central Tax dated October 15, 2020)

It is mandatory for the taxpayers to report minimum 4 digit or 6 digit of HSN Code in table-12 of GSTR-I on the basis of their Aggregate Annual Turnover (AATO) in the preceding Financial Year.

From November 01, 2022, Phase-2 would be implemented on GST Portal and the taxpayers would need to report HSN in table 12 of GSTR-1.

2. GSTN issued Advisory on sequential filing of GSTR-1 & filing of GSTR-1 before GSTR-3B:

• The Goods and Services Tax Network (“GSTN”) has issued Advisory dated October 21, 2022on the sequential filing of GSTR-1 & filing of GSTR-1 before GSTR-3B on the GST Portal.
• The Central Government has amended Section 37 & Section 39 of the Central Goods & Service Tax Act (CGST), 2017 vide Notification No. 18/2022–Central Tax dated September 28, 2022 with effect from October 01, 2022. According to section 37(4) of CGST, Act, a taxpayers shall not be allowed to file GSTR-1 if previous GSTR-1 is not filed and as per sec 39(10) a taxpayer shall not be allowed to file GSTR-3B if GSTR-1 for the same tax period is not filed.
• Section 37(4) & 39(10) of Central Goods & Service Tax Act, 2017 are reproduced below:

Section 37(4) : A registered person shall not be allowed to furnish the details of outward supplies under sub-section (1) for a tax period, if the details of outward supplies for any of the previous tax periods has not been furnished by him:

Section 39(10) : A registered person shall not be allowed to furnish a return for a tax period if the return for any of the previous tax periods or the details of outward supplies under sub-section (1) of section 37 for the said tax period has not been furnished by him:

These changes are being implemented prospectively and will be operational on GST Portal from November 01, 2022. Accordingly, from October-2022 tax period onwards, the filing of previous period GSTR-1 will be mandatory before filing current period GSTR-1.

Illustration: Filing of October, 2022 period GSTR-1 will be mandatory before filing GSTR-1 of November, 2022 period.

Further, from October, 2022 tax period onwards, filing of GSTR-1 will also be mandatory before filing GSTR-3B.

Illustration: Taxpayer will not be allowed to file GSTR-3B for October, 2022 period if GSTR-1 of October, 2022 period is not filed.

3. Paperless customs compliance for exports soon: CBIC Chairman

A new system is in the works where web-based registration of goods exports would be allowed, to facilitate the integration of Customs systems with other regulatory agencies. The system for outbound shipments will be in line with the existing clearance process for imports and will ensure faster clearances for consignments, Central Board of Indirect Taxes and Customs (CBIC) Chairman Vivek Johri said on Thursday.

 “We still have a physical process for registration on the exports side…but we are working on a system where web-based registration of goods is possible which would mean that there’s no need for any broker or exporter to travel to a port to submit their documents to customs for initiating processes,” Johri said.

4.    CBIC imposed anti-dumping duties on ‘Electrogalvanized Steel’ imports from Korea RP, Japan, and Singapore:

• The CBIC issued Notification No. 29/2022-Customs (ADD) on October 19, 2022, stating that anti-dumping duties would be levied on imports of ‘Electrogalvanized Steel’ from Korea RP, Japan, and Singapore. The anti-dumping duty imposed by this notification will be in effect for five years.
• GST Council Notifies Authorities On Actions to Be Taken Consequential to The Issuance Of A Show Cause Notice And Recurring SCNs In The Case Of Enforce
• The GST Council, while clarifying that both the State and Central Authorities can initiate enforcement action, also stated that the authority regarding action consequential to the issuance of Show Cause Notice and for issuance of recurring SCN in case of an enforcement action initiated by the Central authorities against a taxpayer assigned to State and vice versa. An office memorandum issued on Wednesday stated that varied practices are being followed by the field formations regarding the issuance of recurring Show Cause Notices (SCNs) as well as other consequential actions in cases where investigation has been initiated and finalized by Central tax authorities in respect of the taxpayers under State tax Administration and vice versa.
• In some cases, the authority which initiates the investigation is also issuing recurring SCN whereas in some other cases, it is being left for the concerned jurisdictional Tax authority, who is administrating the taxpayer, to issue recurring SCN. This may create confusion and may lead to a situation in which none of the authorities issue the recurring SCN in a timely manner and therefore, there is a need to have a uniform practice in such matters. “A taxpayer located within a State is open to enforcement action by both authorities. For example, enforcement action against a taxpayer, assigned to State tax authorities, can be initiated by the Central tax authorities (and vice versa). In such cases, all the consequential action relating to the case including, but not limited to, appeal, review, adjudication, rectification, the revision will lie with the authority which had initiated the enforcement action i.e. the Central tax authorities the instant case. Refund in such cases may, however, be granted only by the jurisdictional tax authority, administering the taxpayer,” the GST Council clarified.

5. AAR & Judicial Decisions:

(i) AAR On No GST exemption for educational service providers other than formal schools:

(Applicant – Ernakulam-based Tutor Comp Info Tech Private Limited)

Providing educational services to the individual student through an online mechanism by an institution other than a formal school will attract Goods & Services Tax (GST), Kerala Authority for Advance Ruling (KAAR) has said.

Offers educational services in three categories – to individual students, institutions & the students and the government. It moved KAAR to seek an advance ruling regarding exemption from GST on the transaction between it and individual students on a one-to-one basis and to provide education up to higher secondary schools.

The key issue in this matter is serial number 66(A) applicability of Notification No.12/20 17- Central Tax (Rate). Under this serial number, services provided by an educational institution to its students, faculty and staff, and another educational institution will be exempted from GST. Services here include transportation of students, faculty and staff, catering, any mid-day meals scheme sponsored by Governments, security or cleaning or housekeeping services performed in such educational institution and services relating to admission to or conduct of the examination. The exemption will be available to institutions providing education up to higher secondary.

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.