GST – RECENT CHANGES ABHAY DESAI, B.Com., F.C.A., L.L.B., D.I.S.A. YAGNESH DESAI & CO.
SOME POSITIVE LESSONS FROM GABBAR SINGH ON OVERALL GST ROLL-OUT ■ Decisiveness - Jo darr gaya, samjho mar gaya! ■ Brand Building - Gabbar aa jayega
DATE FROM WHICH CHANGES SHALL BE EFFECTIVE ■ It may be noted that as per Sec. 11(1) of the Central Goods & Services Tax (‘CGST’) Act, 2017 Government has power to grant exemption effective from such date as “may” be specified in the notification. ■ Stating effective date in the Notification is not mandatory since the word “may” has been used. Hence if a particular date is specified in the Notification, changes made shall apply from such specified date. ■ Sec. 2(80) “notification” means a notification published in the Official Gazette and the expressions “notify” and “notified” shall be construed accordingly. ■ I.T.C. Bhadrachalam Paper Boards v. Mandal Revenue Officer, AP (JT 1996 (8) 67).
MARKET RESEARCH- KITNEY AADMI THE?
SUSPENSION OF GENERAL RCM ■ Omission v. Repeal ■ Notification No. 38/2017 - Central Tax (Rate) dated 13 October 2017 seeks to amend the previous notification by omitting proviso providing exemption of INR 5,000/day. Hence irrespective of any value, tax under reverse charge u/s 9(4) shall not be payable. ■ Rayala Corporation (P) Ltd vs Directorate of Enforcement (1969 2 SCC 412) ■ General Finance Co. & Another vs Assistant Commissioner of Income-Tax (2002 257 ITR 339 SC) – Doubt expressed
MOTIVATION - JAB TAK TERE PAIR CHALENGEY, TAB TAK ISKI SAANS CHALEGI.
COMPOSITION SCHEME ■ Aggregate turnover limit increased to INR 1 crore for general category States. For specified States limit is INR 75 lakhs - Notification No. 46/2017. ■ Due date to furnish GSTR-4 by composition supplier for quarter July to Sept, 2017 is 24/12/17 – Notification No. 59/2017. ■ Serial 4A (inward supplies from registered suppliers other than RCM) of Table-4 in GSTR-4 shall not be furnished for periods July to Sept & Oct to Dec 2017 – Notification No. 45/2017. ■ Supply of any exempt services including services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount will not make the person ineligible for composition & such value is not to be considered in computing aggregate turnover - Order No. 01/2017-Central Tax. ■ Time limit for intimation in form GST CMP-03 (stock details for migrated persons) extended till 30/11/2017 - Order No. 05/2017-GST.
COMPOSITION SCHEME ■ Option to opt in anytime. It will be applicable with effect from the first day of the month immediately succeeding the month in which he files an intimation in FORM GST CMP-02. ■ FORM GST ITC-03 (for ITC reversal on stocks) to be furnished within a period of ninety days from the day on which such person commences to pay tax under section 10. ■ TRAN – 1 cannot be filed after ITC – 03. ■ Open till 31.03.2018 – (Notification No. 45/2017). ■ Thereafter to opt prior to commencement of FY or on applying for fresh registration – Rule 3(2) & 3(3).
COMPOSITION SCHEME - PROPOSALS ■ Uniform rate of tax @ 1% under composition scheme for manufacturers and traders (for traders, turnover will be counted only for supply of taxable goods). No change for composition scheme for restaurant. ■ Supply of services by Composition taxpayer upto Rs 5 lakh per annum will be allowed by exempting the same. ■ Annual turnover eligibility for composition scheme will be increased to Rs 2 crore from the present limit of Rupees 1 crore under the law. Thereafter, eligibility for composition will be increased to Rs. 1.5 Crore per annum. ■ The changes recommended by GST Council at (iii) above will be implemented only after the necessary amendment of the CGST Act and SGST Acts.
ELIMINATE POTENTIAL THREATS - YE HAATH, HUMKO DE DE THAKUR!
INPUT TAX CREDIT ■ Special procedure or extension of the time limit for furnishing GSTR -2 to be notified separately. – Notification No. 57 & 58/2017 ■ ‘Actual payment test’ not suspended ■ On Quest Merchandising India Pvt. Ltd. v. Government of NCT of Delhi (W.P.(C) 6093/2017 & CM No.25293/2017) – Landmark decision ■ Extends the time limit for declaration in Form GST ITC-01 (for claiming opening ITC u/s 18(1)) for July, August & Sept 2017 to 30/11/17 – Notification No. 52/2017
ADVANCE RULING ■ Manual filing permitted - Notification No. 55/2017
CLEARING ALL DUES IN TIME - BAHUT PACHTAUGEY THAKUR, BAHUT PACHTAOGEY.
REFUND APPLICATION ■ Manual filing and processing of refund application enabled. Form RFD - 01 A prescribed for making application & order to be passed in Form RFD - 01 B – Notification No. 55/2017. Applicable for all categories of refunds except export of goods with payment of tax. ■ Shipping Bill is the refund application in case of export of goods with payment. ■ Circular No. 17/17/2017 – Detailed guidelines for claiming manual refund. ■ Customs vide Circular No. 42 has asked GSTN to provide for Table 9A in GSTR – 1 for August to make correction in GSTR – 1 of July so that refund claim can be processed. ■ Online: ■ RFD – 01 A – Refund for accumulated ITC on account of zero-rated supplies made without payment – ARN after debit to be submitted manually with necessary evidences. ■ GSTR – 1E – Refund on exports with payment of GST for August & thereafter.
DEEMED EXPORTS ■ Sec. 2(39) of the CGST Act, 2017 defines deemed exports to mean such supplies of goods as may be notified under section 147. ■ As per Sec. 147 Government has power to notify certain supplies of goods as deemed exports, where goods supplied do not leave India, and payment for such supplies is received either in Indian rupees or in convertible foreign exchange, if such goods are manufactured in India.
CATEGORIES OF DEEMED EXPORTS ■ Supply of goods by a registered person against Advance Authorization ■ Supply of capital goods by a registered person against Export Promotion Capital Goods Authorization ■ Supply of goods by a registered person to Export Oriented Unit ■ Supply of gold by a bank or Public Sector Undertaking specified in the notification No. 50/2017-Customs, dated the 30th June, 2017 (as amended) against Advance Authorization - Notification No. 48/2017 ■ “Export Oriented Unit” means an Export Oriented Unit or Electronic Hardware Technology Park Unit or Software Technology Park Unit or Bio-Technology Park Unit approved in accordance with the provisions of Chapter 6 of the Foreign Trade Policy 2015-20. ■ “ Advance Authorisation ” means an authorisation issued by the Director General of Foreign Trade under Chapter 4 of the Foreign Trade Policy 2015-20 for import or domestic procurement of inputs on pre-import basis for physical exports ■ Export Promotion Capital Goods Authorisation means an authorisation issued by the Director General of Foreign Trade under Chapter 5 of the Foreign Trade Policy 2015- 20 for import of capital goods for physical exports.
REFUND - DEEMED EXPORTS ■ As per Explanation 1 to Sec. 54 of the CGST Act, 2017 word refund includes the refund of tax on the supply of goods regarded as deemed exports. ■ Hence benefit under the GST law is that once a supply is regarded as deemed exports, refund of tax paid on such supply including provisional refund shall become available. ■ To facilitate said refund a proviso has been inserted in Rule 89(1) of CGST Rules, 2017 to provide that an application for refund in respect of supplies regarded as deemed exports can be filed either by the supplier of deemed export supplies in cases where the recipient does not avail of input tax credit on such supplies and furnishes an undertaking to the effect that the supplier may claim the refund or by the recipient of deemed export supplies (Notification No. 47/2017 – Central Tax dated 18th October, 2017). ■ Application for such refund must be filed within two years from the date on which return relating to such deemed exports is furnished.
EVIDENCES FOR CLAIMING REFUND – DEEMED EXPORTS ■ Acknowledgment by the jurisdictional Tax officer of the Advance Authorisation holder or Export Promotion Capital Goods Authorisation holder, as the case may be, that the said deemed export supplies have been received by the said Advance Authorisation or Export Promotion Capital Goods Authorisation holder, or a copy of the tax invoice under which such supplies have been made by the supplier, duly signed by the recipient Export Oriented Unit that said deemed export supplies have been received by it. ■ An undertaking by the recipient of deemed export supplies that no input tax credit on such supplies has been availed of by him. ■ An undertaking by the recipient of deemed export supplies that he shall not claim the refund in respect of such supplies and the supplier may claim the refund. Notification No. 49/2017
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