Category: CA Chandrasekhar Kutty. B.Com, F.C.A.

Important decisions: GTAs will not be required to file declaration for paying GST under forward charge every year. If they have exercised this option for a particular financial year, they shall be deemed to have exercised it for the next and future financial years unless they file a declaration that they want to revert to reverse charge mechanism (RCM). The last date of exercising the option by GTAs to pay GST under forward charge shall be 31st March of preceding Financial Year instead of 15th March. 1st January of preceding Financial Year shall be the start date for exercise of option. Services supplied by the director to the company in his personal capacity like renting of immovable property etc will not covered under RCM Supply of food and beverages in…

Government notifies Goods and Services Tax Network (GSTN) under the Prevention of Money-laundering Act, 2002; Amends Prevention of Money-laundering Act Notification G.S.R. 152 (E) dated the March 01, 2021

CBIC clarifies on the aspect of interest payable on late payment of tax and wrongly availed ITC; On the occasion of 6 years of GST, apprise that taxpayers are liable to pay interest only if they utilized the wrongly availed ITC for payment of GST liability; States that a decision has been taken to provide relief to the taxpayers retrospectively; Also, informs about reduction in the interest rate on wrongly availed and utilised ITC from 24% to 18% (from July 1, 2017): CBIC

CBIC reduces compliance burden for small taxpayers, waives requirement of filing Annual Return in Form GSTR-9 for taxpayers with annual turnover up to Rs. 2 Crores; Also, waives requirement of filing reconciliation statement in Form GSTR-9C by taxpayers with annual turnover up to Rs. 5 crores: CBIC 

In the previous article about LRS and new TCS Regime, we had discussed about the following: New TCS Regime and its postponement of implementation to 1st October 2023. (Ie. Increasing TCS Rates from 5% to 20%, removal of threshold of ₹700,000) E gazette notification on 16th May 2023 to remove differential treatment of credit card and to streamline it through LRS. Please do refer to the previous write up to decipher and appreciate this article better. The above changes were postponed, providing more time for the banking channels and credit card network to equip themselves to change. Various comments about practical difficulties that arise from the above changes were received. As a measure to address these issues, the Ministry of Finance has issued a press release dated 28th June 2023…

GSTN in pursuance of lowering of threshold for e-Invoicing for B2B transactions (from Rs. 10 crores to Rs. 5 crores) applicable from August 01, 2023 introduces enablement status on the e-Invoice portal; Advisory states that enablement status indicated on the e-Invoice portal does not indicate a legal obligation on taxpayers to use e-Invoicing, but reflects actual liability to generate IRN with respect to applicable notification in the light of facts pertaining to them; Urges taxpayers to familiarize with e-Invoicing requirements and e-invoicing system as also self-enable for e-Invoicing using the functionality provided on the portal: GSTN Advisory Find below the copy of the advisory eInvoice-AdvisoryDownload

Guidelines issued by CBIC for processing of applications for registration on 14th June 2023 Instruction No. 03/2023 Instances have come to notice regarding unscrupulous elements obtaining fake/ bogus registration under GST and defrauding the Government exchequer. Such fake/ non-genuine registrations are being used to fraudulently pass on input tax credit to unscrupulous recipients by issuing invoices without any underlying supply of goods or services or both. This menace of fake registrations and issuance of bogus invoices for passing of fake ITC has become a serious problem, wherein fraudulent people engage in dubious and complex transactions, causing revenue loss to the government. Various modus operandi of obtaining such fake registrations have been detected by Central and State Tax administrations. In some cases, identities of other persons like PAN, Aadhaar, etc. have…

Advisory on Filing of Declaration In Annexure V by Goods Transport Agency (GTA) opting to pay tax under forward charge mechanism30/05/2023• 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 Notification. No. 05/2023-Central Tax (Rate), dated. 09.05.2023.

Introduction and Applicability of Sec 194BA As per section 194BA, any person earning income from winnings from any online gaming, then the person who is responsible to pay such winnings shall be liable to deduct TDS from the net winnings of such person earning income. Threshold Limit TDS shall be deducted on every single rupee earned after deduction of entry fee if any, which shall be considered as net winnings. Thus, the threshold of Rs. 10,000/- shall not be applicable while deducting TDS. Rate of TDS TDS shall be deducted at the rate of 30% on the net winnings from any online gaming. eg. Dream 11, My11circle, Lotus 365, etc., Section 194BA: TDS on Winning from Online games – CBDT Clarifies Circular No. 5 of 2023, issued by the Central…

Dear Taxpayer, Your GSTR9 issue has been resolved now. Eligible ITC as per GSTR2A is auto populating in GSTR9 - Table8A. Please note that GSTR2A data will not always matches with GSTR9 --> Table 8A data because of following reasons: 1) Figures in GSTR-2A are auto populated based on filed/ saved / submitted Form GSTR-1 of the supplier taxpayer. But figures in table 8A of Form GSTR-9 are auto-populated only on the basis of only FILED Form GSTR-1 by the supplier taxpayer. In case, Form GSTR -1 is not filed by your supplier, then credit related to those invoices will not appear in table 8A of your Form GSTR-9. 2) For FY: 2017-18, Figures in table 8A of Form GSTR 9 are auto populated only for those of Form GSTR-1,…

CBIC implements e-invoicing for taxpayers having aggregate turnover exceeding Rs. 5 crores from August 01, 2023; Reduces limit for e-invoicing to Rs. 5 crores (from Rs. 10 crores)

CBIC extends last date for exercise of option by Goods Transport Agency (GTA) to pay GST under forward charge till May 31, 2023 for the Financial Year 2023-2024; Also appends that a GTA who commences new business or crosses threshold for registration during any Financial Year, may exercise the option to itself pay GST on the services supplied by it during that Financial Year by making a declaration in Annexure V before the expiry of 45 days from the date of applying for GST registration or one month from the date of obtaining registration whichever is later; As a consequence, amends Notification no. 11/2017-Central Tax, Notification no. 08/2017-Integrated Tax and Notification no.11/2017-Union Territory Tax, all dated June 28, 2017

CBIC issues guidelines for concerted action against fake dealers/ fake billers in a mission mode during Special All-India Drive by all Central and State Tax administrations, from May 16, 2023 to July 15, 2023, to detect suspicious / fake GSTINs and to conduct requisite verification and further remedial action to weed out these fake billers from the GST eco-system; Outlines action points for officers, information sharing mechanism, feedback and reporting mechanism; GST Council Secretariat to act as the secretariat of National Coordination Committee to monitor the progress of the special drive, and National Coordination Committee to meet periodically for this purpose; Instructions issued in view of the decision at National Co-ordination Meeting of the State and Central GST officers to launch a Special Drive on All-India basis, recognizing a need of concerted and coordinated…

06/05/2023 Dear Taxpayers, It is to inform you that it has been decided by the competent authority to defer the imposition of time limit of 7 days on reporting old e-invoices on the e-invoice IRP portals for taxpayers with aggregate turnover greater than or equal to 100 crores by three months. In this regard, the link to the previously issued advisory dated 13th April 2023 may be referred at: https://www.gst.gov.in/newsandupdates/read/578 The next date of implementation will be shared with you in due course of time. Thank You,Team GSTN

The GSTN has issued a new facility to verify document Reference Number (RFN) mentioned on offline communications issued by State GST authorities in order to enable the taxpayers to ascertain that an offline communication (i.e. one which is not system-generated) was indeed sent by the State GST tax officer or not. It is informed that in order to verify a Reference Number mentioned on the offline communications sent by State GST officers, the taxpayers can navigate to Services > User Services > Verify RFN option and provide the RFN which need to be verified. In case the RFN is of an offline communication generated by the State GST officer, the details with the valid RFN will be displayed.

Bombay HC refuses to strike down provisions of Section 13(8)(b) and Section 8(2) of IGST Act as unconstitutional, however, observes that “the mechanism for Section 13(8)(b) to operate is confined only to the provisions of the IGST Act”; While upholding Section 13(8)(b) of IGST Act, caveats that “the fiction which is created by Section 13(8)(b) would be required to be confined only to the provisions of IGST Act, as there is no scope for the fiction travelling beyond the provisions of IGST Act to the CGST and the MGST Acts, as neither the Constitution would permit taxing of an export of service under the said enactments nor these legislations would accept taxing such transaction”; Observes that “cumulative effect of the provisions of Section 13(8)(b) read with Section 8(2) and Section 12 of the IGST Act, …, can neither…

Allahabad HC sets aside order cancelling GST registration terming it as ‘reckless and vague’, thereby deriding GST Authorities for their conduct; Assessee was issued notice in FORM GST REG-23 proposing cancellation of registration on the ground that in the survey, the firm was not found to be existent in the business place; Observes that “…order is not only arbitrary but a reckless exercise of power which led to denial of the rights of freedom and business guaranteed under Article 19 of the Constitution of India, as such, the orders and the show cause notice can never pass the test of Article 14 of the Constitution of India.”; Court directs that a copy of this order be sent to the Ministry of Finance “…to ensure that this kind of show cause notices…are not…

CBIC has issued a notification giving effect to recommendations made by the GST Council vide Notification No. 8/2023-Central Tax (Rate) dated March 31, 2023, whereby there is a waiver of late fee as prescribed in section 47 of the CGST Act, which is in excess of Rs. 1,000/- (CGST – Rs. 500 + SGST- Rs. 500) for the registered persons who fail to furnish the final return in FORM GSTR-10 by the due date but furnish the said return between the period from April 01, 2023 to June 30, 2023. Hence, this Amnesty scheme for Final Return in FORM GSTR-10 has been provided if the said return is furnished in the period starting from April 01, 2023 to June 30, 2023 with a maximum payment of late fees of Rs…

CBIC vide Notification No. 07/2023 – Central Tax dated March 31, 2023 has reduced the amount of late fees for filing the return under section 44 of the CGST Act viz. Annual Return, which may include the self-certified reconciliation statement (GSTR 9 & GSTR 9C), for the financial year 2022-23 and onwards in the following manner: – Upto Rs. 5 crs aggregate turnover reduced from the current fees from Rs.200 per day  subject to maximum of 0.5% of the turnover in the state to Rs.50 per day subject to a maximum of 0.04% of the turnover in the state Rs.5 crs to Rs.20 crs aggregate turnover reduced from the current fees from Rs.200 per day  subject to maximum of 0.5% of the turnover in the state to Rs.100 per day…

CBIC vide Notification No. 06/2023 – Central Tax dated March 31, 2023 in order to align with the recommendations made by the GST Council, has notified that the registered persons who failed to furnish a valid return under Section 39 (GSTR 3B) and Section 45 (Final Return) of the Central Goods and Services Tax Act, 2017 (“the CGST Act”), within a period of 30 days from the service of the assessment order issued on or before February 28, 2023 under Section 62(1) of the CGST Act i.e. best judgment assessment, shall be deemed to have been withdrawn, if such registered person furnishes the stated return on or before June 30, 2023, along with interest under Section 50(1) and late Fee under Section 47 of the CGST Act. Further, the withdrawal…

Due to the ambiguity and volatility instigated by Covid 19, FTP which was to end by 31/03/2020 got extended to 31/03/2023. FTP 2020 to a great extent aided in increasing exports manifold. All About New FTP 2023 Policy changes were being undertaken since 2015 even without announcement of a new FTP. It intends to provide the policy continuity and a responsive framework Continuous feedback will be taken from trade and industry to streamline the process and keep them updated New FTP Approach Stride towards Tax remissions Deploying automations and process re-engineering to facilitate trade Emphasis on export promotion through meaningful collaborations Focus on Emerging avenues: Developing of export Hubs, streamlining SCOMET(Tit bit: SCOMET stands for certain dual use items that can be used for civilian cum military purposes) Key takeaways…

Unveiling the much-awaited Foreign Trade Policy, Commerce Ministry on Friday broke the tradition of a policy lasting for five years and will instead adopt a 'long-term' focus. There is no end date to the policy and will be updated as and when necessary, the ministry said.Further, the new policy will move from incentives to a remission regime."The policy will be dynamic. There is no end date to ensure when we have feedback, we will keep changing this document and update it. If there is a sector which feels this FTP does not have anything for them, don't feel disappointed," Santosh Sarangi, Director General of Foreign Trade (DGFT) said. A consultative mechanism to address the concerns of trade will be put in, he added.The DGFT said that the overall exports, inclusive…

CBIC to initiate phase wise implementation of Electronic Credit Ledger (ECL) in customs w.e.f April 1, 2023; Considering the current state of development and integration of IT infrastructure, the decision has been made to enable ECL in two phases, where Phase I will be implemented from April 1 to April 30, and Phase II will be implemented from May 1 ; Pertinently, points out that “The balance in ECL being deposit, its refund is not governed by section 27 of Customs Act.”: CBIC Circular 

GST e-Invoice Portal mandates taxpayers to report 6-digit HSN codes to e-Invoice Portal in compliance with Notification No.78/2020 – Central Tax dated October 15, 2020; As per the said Notification, it is compulsory for taxpayers having Aggregate Annual Turnover (AATO) of more than Rs 5 cr mention 6-digit HSN Codes for their outward supplies; Apprises that in few weeks time, the system will block 4-digit HSN codes and therefore, taxpayers should make necessary changes in their system; Informs that the exact date of blocking e-Invoice generation having HSN code as 4-digits will be intimated shortly in the portal; In cases where  6 digit HSN code is not available, suggest the taxpayers to raise a ticket at Helpdesk so that it can be included in the system.

Maharashtra Govt introduces ‘Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act, 2023’ as an Amnesty Scheme to grant full/partial waiver of arrears pending as on May 1, 2023 in respect of various laws implemented before GST enactment; Presenting Maharashtra Budget 2023-2024, the State FinMin and Dy CM Devendra Fadnavis enumerated the following key features of the said scheme, viz. (i) Complete waiver of the arrears in cases where arrears are Rs. 2,00,000  or less per year, (ii)  80% waiver for  Dealers having arrears up to Rs. 50 lakhs or less as per statutory order, who will then have to pay only 20%, (ii) Scheme will be in force from May 1, 2023 to October 31, 2023; Other indirect tax sops include reduction of VAT on Aviation Turbine Fuel…

Option to Utilize the amount in cash ledger of one GSTIN by Another GSTIN having same Pan Rule-87(14): Electronic Cash Ledger a registered person may, on the common portal, transfer any amount of tax, interest, penalty, fee or any other amount available in the electronic cash ledger under the Act to the electronic cash ledger for central tax or integrated tax of a distinct person as specified in sub-section (4) or, as the case may be sub-section (5) of section 25, in form GST PMT-09: Provided that no such transfer shall be allowed if the said registered person has any unpaid liability in his electronic liability register

Advisory on opting for payment of tax under the forward charge mechanism by a Goods Transport Agency (GTA) 25/02/2023 In compliance of Notification No. 03/2022-Central Tax (Rate), dated 13th July, 2022, an option is being provided on the portal to all the existing taxpayers providing Goods Transport Agencies Services, desirous of opting to pay tax under the forward charge mechanism to exercise their option. They can navigate Services > User Services > Opting Forward Charge Payment by GTA (Annexure V), after login, to submit their option on the portal. Option in Annexure V FORM is required to be submitted on the portal by the Goods Transport Agencies every year before the commencement of the Financial Year. The Option once filed cannot be withdrawn during the year and the cut-off date…

Regular taxpayers can opt for Compostion scheme for financial year 2023-24 by navigating as 'Services-> Registration-> Application to OPT for composition scheme

Advisory on New e-Invoice Portal 25/02/2023 Dear Valued Taxpayers, 1. We would like to inform you that GSTN has onboarded four new IRPs (Invoice Reporting Portals) for reporting e-invoices in addition to NIC-IRP. As a result, the beta launch of a new e-Invoice portal (www.einvoice.gst.gov.in), has been done where taxpayers can find comprehensive information on e-invoice compliance in a user-friendly format, such as check your enablement status, self-enable themselves for invoicing, search for IRNs, web links to all IRP portals – all the relevant links/information in one convenient location. Taxpayers can log in to the new e-invoice portal using their GSTN credentials for select services pertaining to their GSTIN profiles. 2. Taxpayers may note that the portal <einvoice.gst.gov.in> is reference site for all masters (data), news and updates, latest releases…

Very Important announcement made in 49th GST Council meeting pertaining to services of transportation of goods The GST Council has proposed to change the place of supply of services related to transportation of goods where the supplier or recipient of such service is outside India. Currently, the place of supply of such services (except via mail or courier) is determined as per the destination of such goods. Interestingly, the Council has proposed deletion of this specific provision. It would logically follow that these services should now be governed by the default rule of determining the place of supply of cross border services (location of recipient). Businesses engaged in the cross border trade and logistics industry will need to closely evaluate the implications of this proposed amendment on the supply chain. 

1.The Government vide Notification No. 14/2022 – Central Tax dated 05th July, 2022 has notified few changes in Table 4 of Form GSTR-3B for enabling taxpayers to report correct information regarding ITC availed, ITC reversal and ineligible ITC in Table 4 of GSTR-3B. According to the changes, the net ITC is to be reported in Table 4(A) and ITC reversal, if any, is to be reported in Table 4(B) of GSTR-3B. 2.Currently in GSTR-3B, credit note (CN) is being auto-populated in Table 4B(2), as ITC reversal. Now in view of the said changes, the impact of credit notes are also to be accounted on net off basis in Table 4(A) of GSTR-3B only. Accordingly following changes have been made in the GST Portal from January-2023 period onwards and shall be…

Extension of time limit for application for revocation of cancellation of registration and one time amnesty for past cases The Council has recommended amendment in section 30 of CGST Act, 2017 and rule 23 of CGST Rules, 2017 so as to provide that- the time limit for making an application for revocation of cancellation of registration be increased from 30 days to 90 days;where the registered person fails to apply for such revocation within 90 days, the said time period may be extended by the Commissioner or an officer authorised by him in this behalf for a further period not exceeding 180 days.The Council has also recommended that an amnesty may be provided in the past cases, where registration has been cancelled on account of non-filing of the returns, but…

Personal Taxation: Change in New Tax Regime: The slab and rate of tax for new tax regime (Section 115BAC) which was introduced couple of years has been revised as stated below: Total IncomeRate of TaxUpto Rs. 3 LakhsNilFrom Rs. 3 lakhs to Rs.6 lakhs5%From Rs. 6 lakhs to Rs.9 lakhs10%From Rs. 9 lakhs to Rs.12 lakhs15%From Rs. 12 lakhs to Rs.15 lakhs20%Above 15 Lakhs30% The impact of this change in slabs and rate of tax will result in reduction of Income tax. The new tax regime will become the default tax regime, which means, if the tax payer wants to opt for the old regime, he/she has to choose the option.The highest Surcharge has been reduced from 37% to 25%Rebate u/s 87A has been now extended to tax payers having…

Key Budget Highlights 2023 – GST Composition taxpayers allowed to supply goods through electronic commerce operators who is required to collect tax at source.Input tax credit not available if used by the corporate relating to its CSR activities.Registration requirement under Section 23 amended and now even if your turnover exceeds the limit, you need not register if:(a) You are exclusively in the business of sullying wholly exempted / non taxable goods or services or(b) Agriculturist (on the supply of agriculture produce) GSTR 1 cannot be filed after three years form the due date.GSTR 3B cannot be filed after three years form the due date.GSTR 9 (Annual return) cannot be filed after three years form the due date.TCS returns under section 52 cannot be filed after three years from the due…

Economic Survey 2022-23 highlights that the gross GST collections increased at 24.8% on YoY basis from April to December 2022 thus, GST has "evolved and stabilised as a vital revenue source for central and state governments"; Survey highlights that introduction of GST, with its end-to-end digitisation of all processes, tax administration, have improved governance and formalisation of the economy and seamless generations of e-way bills and electronic toll collections have augmented better tax collections for Government and curbed tax evasion; GST led to better reporting of income, which in turn has positive externalities for income tax collection, report further mentions that consistent efforts have resulted in a doubling of the GST net, with the number of GST taxpayers increasing from nearly 70 lakh in 2017 to more than 1.4 crore in 2022; Amidst unprecedented external…

Orient Traders vs The Deputy Commissioner of Commercial Taxes Karnataka HC permits Assessee to rectify Form GSTR 3B return for July, 2017 and March, 2018, holds that allowing assessee to make such changes would neither cause any prejudice to the Revenue nor would it upset the chain of credit under the GST scheme; Pursuant to Revenue audit enquiries, the Assessee came to know about about certain inadvertent errors and mistakes during filing of returns for FY 2017-18 which led to mismatch between the GSTR-3B and GSTR2A forms; The error was attributable to claiming ITC relating to imports under Column No. 4A(5) instead of Column No. 4A(1); Because of such error, the Deputy Commissioner of Commercial Taxes (DCCT) in its audit report held that ITC accrued to assessee was liable to be disallowed and the said report lead to issuance of impugned SC; HC notes the problems faced by dealers across…

Why the section was introduced: Ministry of finance noticed the Revenue Leakage in providing Benefits/perquisites. Rate: 10% Threshold Limit: Rs 20,000[i.e., deduct only when exceeds 20000] Who has to deduct(deductor): Other than Individual/HUFIndividual/HUF whose sales/gross receipts/TO > 1cr (Business) or >50 Lakhs (Profession) in the immediately preceding financial year. For whom to deduct(deductee): Who is getting the benefit/perquisite (applicable only for Resident Assesse) When to deduct: Before releasing benefit/perquisite Other Points: Benefit/Perquisite can be in the form of cash or kind or part thereof.Sec. is applicable irrespective of whether the benefit/perquisite is contractual/gratuitousWaiver of Loan is not benefit or perquisitePurchase of shares as an investment with lock in period of holding, for consideration less than Market value – Not a benefit/perquisite Vehicle provided to director of a company for free…

The Joint Commissioners (ST), Intelligence have raised certain queries regarding booking of offences by the Roving Squad officers under the provisions of the TNGST Act, 2017 and requested that suitable guidelines may be given for uniformity in levy of penalty relating to various types of offences noticed by the Roving Squad officers and to perform in an efficacious manner.The said queries raised were examined in detail with reference to earlier circular instructions issued in the references cited and as per the provisions of the TNGST Act & Rules 2017 and a circular is issued with regard to the amendments made.In Para 11 of said circular, instructions have been issued for “Circumstances where penalty of Rs. 25,000/- shall be levied.”The existing para: -(i) In the circumstances described in Sl.No.10 if any…

In the matter of Tata Motors Limited Gujarat AAAR modifies AAR by holding Tata Motors (appellant) eligible to input tax credit (ITC) on GST charged by service provider on canteen facility to its direct employees working in the factory but not to contractual employees, visitors etc; Citing CBIC’s clarification in Circular No. 172/04/2022-GST dated July 06, 2022 along with the statutory framework surrounding ‘blocked credit’, particularly, section 17 (5) of under GST observes that “ITC on GST charged by the canteen service provider will be available only to the extent of cost borne by the appellant, for providing the canteen services only to its direct employees”; Applies ratio laid down by Bombay HC in case of Ultratech Cement though delivered in the context of service tax; On the basis of placement of punctuation viz. colon(:)…

Circular No. 185/17/2022-GST New Delhi, Dated the 27th December, 2022 1. Attention is invited to sub-section (2) of section 75 of Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”) which provides that in cases where the appellate authority or appellate tribunal or court concludes that the notice issued by proper officer under sub-section (1) of section 74 is not sustainable for reason that the charges of fraud or any willful-misstatement or suppression of facts to evade tax have not been established against the person to whom such notice was issued (hereinafter called as “noticee”), then the proper officer shall determine the tax payable by the noticee, deeming as if the notice was issued under sub-section (1) of section 73. 2. Doubts have been raised by…

Circular No. 183/15/2022-GST dated 27th December 2022 Section 16 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”) provides for eligibility and conditions for availing Input Tax Credit (ITC). During the initial period of implementation of GST, during the financial years 2017-18 and 2018-19, in many cases, the suppliers have failed to furnish the correct details of outward supplies in their FORM GSTR-1, which has led to certain deficiencies or discrepancies in FORM GSTR-2A of their recipients. However, the concerned recipients may have availed input tax credit on the said supplies in their returns in FORM GSTR-3B. The discrepancies between the amount of ITC availed by the registered persons in their returns in FORM GSTR-3B and the amount as available in their FORM GSTR-2A…

Instances have been brought to the notice where the unregistered buyers, who had entered into an agreement/ contract with a builder for supply of services of construction of flats/ building, etc. and had paid the amount towards consideration for such service, either fully or partially, along with applicable tax, had to get the said contract/ agreement cancelled subsequently due to non-completion or delay in construction activity in time or any other reasons. In a number of such cases, the period for issuance of credit note on account of such cancellation of service under the provisions of section 34 of the Central Goods and Service Tax Act, 2017 (hereinafter referred to as ‘CGST Act’) may already have got expired by that time. In such cases, the supplier may refund the amount…

Circular No. 186/18/2022-GST dated 27th December 2022 Taxability of No Claim Bonus offered by Insurance companies Whether the deduction on account of No Claim Bonus allowed by the insurance company from the insurance premium payable by the insured, can be considered as consideration for the supply provided by the insured to the insurance company, for agreeing to the obligation to refrain from the act of lodging insurance claim during the previous year(s)? As per practice prevailing in the insurance sector, the insurance companies deduct No Claim Bonus from the gross insurance premium amount, when no claim is made by the insured person during the previous insurance period(s). The customer/ insured procures insurance policy to indemnify himself from any loss/ injury as per the terms of the policy, and is not…

Circular No. 184/16/2022-GST dated 27th December 2022 Attention is invited to sub-section (8) of section 12 of Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as “IGST Act”) which provides for the place of supply of services by way of transportation of goods, including by mail or courier, where location of the supplier as well as the recipient of services is in India. As per clause (a) of the aforesaid sub-section, the place of supply of services by way of transportation of goods, including by mail or courier, to a registered person shall be the location of such registered person. However, the proviso to the aforesaid sub-section which was inserted vide the Integrated Goods and Services Tax (Amendment) Act, 2018 w.e.f. 01.02.2019 provides that where the transportation of…

1.Provisions under the TNGST Act, 2017: Section 67(12) of the TNGST Act 2017 states that, the Commissioner or an officer authorised by him may cause purchase of any goods or services or both by any person authorised by him from the business premises of any taxable person, to check the issue of tax invoice or bills of supply by such taxable person and on return of goods so purchased by such officer, such taxable person or any person in charge of the business premises shall refund the amount so paid towards the goods after cancelling any tax invoice / bill of supply issued earlier.As per Notification No. 4 dated 12-07-2017 issued by the Commissioner, the Joint Commissioners concerned have been authorised for the purpose of Section 67 of the TNGST…

The instances of search, inspection and investigation has increased manifold, it is very important to keep in my mind, no officers can force any taxpayer to make the payment of any tax, interest, or penalty on the spot. Delhi High Court in the case of Vallabh Textiles has reiterated deposit of tax in Form GST DRC 03 is voluntary by the taxpayer and since no acknowledgment in DRC 04 was issued by the department, the amount paid was directed t be refunded back to the taxpayer. Further, HC refers to Gujarat HC directions in Bhumi Associate against which backdrop CBIC Instruction No. 01/2022-23 [GST – Investigation] dated May 25, 2022 was issued relating to ‘Deposit of tax during the course of search, inspection or investigation’ and pertinently mentions that, CBIC…

Major highlight of the 48th GST Council meeting held on 17th December 2022  Clarification on charging compensation cess on SUV’s. If all the below four conditions are met it will be classified as SUV and higher rate of compensation cess of 22% is applicableIt is popularly known as SUV andEngine capacity exceeding 1500 cc andLength exceeding 4000 mm andGround clearance of 170 mm.·         No GST is payable where the residential dwelling is rented to a registered person if it is rented it in his/her personal capacity for use as his/her own residence and on his own account and not on account of his business.·         Incentive paid to banks by Central Government under the scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions are in the nature of…

In the matter of Krishna Institute of Medical Sciences Ltd Andhra Pradesh AAR holds that administration of COVID-19 vaccination by Hospitals is a ‘Composite Supply’, wherein the principal supply is the ‘sale of vaccine’ and the auxiliary supply is the service of ‘administering the vaccine’ and the total transaction is taxable at 5%; AAR observes that both the supplies i.e. sale of vaccine and administering of vaccine are intrinsically connected with each other, and it is viewed as a single package by the recipient, where he purchases the vaccine and gets it administered subsequently; AAR determines that, generally, the primary requirement of recipient would be the receipt of vaccine, basing on his choice i.e., Covishield or Covaxin, thus, the supply of goods constitutes the major supply; Moreover, AAR apprises that, proper administration of…

GSTN gives the taxpayers facility to revoke the suspension of their GST registration on their own with a single click of a button in the common portal itself; Taxpayers can access the facility known as “Initiate Drop Proceedings’ after filing their pending 6 returns under ‘Notices and orders’ in the common portal; GSTN explains that this facility is for those who file their pending returns after receipt of SCN ; This enables the taxpayers, who have filed their returns but have not responded to the SCN, to revoke the suspension all on their own: GSTN