Minutes of the 12th GST Council Meeting held on 16th March 2017
12th GST Council Meeting Dated:- 16-3-2017 GST Council – Minutes
GST
Minutes of the 12th GST Council Meeting held on 16th March 2017
The twelfth meeting of the GST Council (hereinafter referred to as 'the Council') was held on 16 March 2017 in Vigyan Bhavan, New Delhi under the Chairpersonship of the Hon'ble Union Finance Minister, Shri Arun Jaitley. The list of the Hon'ble Members of the Council who attended the meeting is at Annexure 1. The list of officers of the Centre, the States, the GST Council and the Goods and Services Tax Network (GSTN) who attended the meeting is at Annexure 2.
2. The following agenda items were listed for discussion in the 12th Meeting of the Council
1. Confirmation of the Minutes of the 11th GST Council Meeting held on 4 March 2017
2. Approval of the Draft Model SGST Law as modified in accordance with the decisions of the GST Council and as vetted by the Ministry
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ced on record the positive contribution of the outgoing Ministers in the Council's deliberations which the Council fully endorsed.
Discussion on Agenda Items
Agenda Item 1: Confirmation of the Minutes of the 11th GST Council Meeting held on 4 March, 2017:
4. The Hon'ble Chairperson invited comments of the Members on the draft Minutes of the 11th Meeting of the Council (hereinafter referred to as 'Minutes') held on 4 March 2017 before its confirmation. The Members suggested the following amendments to the draft Minutes.
4.1. The Hon'ble Minister from Jammu & Kashmir stated that in paragraph 8.3 of the Minutes, in the second sentence, the expression 'Article 5 of the Constitution of Jammu & Kashmir' should be replaced by the expression 'Section 5 of the Constitution of Jammu & Kashmir'. The Council agreed to this suggestion.
4.2. Shri R.K Tiwari, Additional Chief Secretary, Uttar Pradesh stated that in paragraph 6.2.8 of the Minutes, the ver
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recorded below:
5.1. In paragraph 8.3 of the Minutes, in the second sentence, the expression' Article 5 of the Constitution of Jammu & Kashmir' to be replaced by the expression 'Section 5 of the Constitution of Jammu & Kashmir'.
Agenda Item 2: Approval of the Draft Model State Goods and Services Tax (SGST) Law as modified in accordance with the decisions of the GST Council and as vetted by the Ministry of Law & Justice, Government of India:
6. Introducing this agenda item, the Secretary informed that the draft SGST Law was almost a replica of the Central Goods and Services Tax (CGST) Law, with some minor changes. He invited Dr. P.D. Vaghela, Commissioner, Commercial Taxes (CCT), Gujarat to briefly explain the changes in the SGST Law vis-a-vis the CGST Law. CCT, Gujarat explained that there were three major changes in the SGST Law as compared to the CGST Law, namely (i) the transitional provisions would be different in each State; (ii) Advance Ruling Authority would b
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the Minutes. The Secretary invited comments of the Members on the draft SGST Law circulated as an Agenda Note and the amendments proposed thereto as contained in Annexure- 3.
6.1. The Hon'ble Deputy Chief Minister of Delhi stated that in Section 67(1) of the draft SGST Law, it was provided that a proper officer not below the rank of Joint Commissioner could authorise inspection or search of a premise. He observed that this power should only vest with the Commissioner as otherwise, all officers of the rank of Joint Commissioner could exercise the power of inspection, search and seizure. The Secretary stated that this provision restricted the power to authorise inspection and search to an officer not below the rank of Joint Commissioner and this did not preclude this power to remain vested only with the Commissioner. Dr. Reeta Vasishta, Additional Secretary, Legislative Department, Ministry of Law explained that an officer below the rank of Joint Commissioner could not be designated
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of the Constitution of the State of Jammu & Kashmir. He stated that on this account, if certain drafting changes were required in the SGST Law of the State of Jammu & Kashmir, it would be done in consultation with the Council. The Hon'ble Chairperson observed that the SGST Legislation of Jammu & Kashmir could be enacted by the Jammu & Kashmir Legislature itself without reference to the Council and that their SGST Law would need to have a provision to integrate it to the GST process of the country. The Hon'ble Minister from Jammu & Kashmir raised an issue that since the SGST Law of his State was to be enacted under its own Constitution, whether it could enact a more ambitious SGST Legislation, like including sectors such as real estate and power under their SGST Law. The Secretary observed that this would not be feasible as a seprate dispensation on real estate or power sector in the SGST Act of Jammu & Kashmir would create problem in relation to operation of the IGST Law.
6.3
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he changes as indicated in Annexure-3 of the Minutes (the changes as suggested in the meeting of the officers of the Centre and the States held on 16 March 2017 in New Delhi). The Council also authorised the Law Committee of Officers to make minor corrections and rectify typographical errors, wherever required, and that the revised draft SGST Law shall be shared with the States. The Council also agreed that the relevant GST Rule shall provide that, if so required, the Central Tax Administration would carry out audit and scrutiny of the departments of the Central Government which deducted tax at source under Section 51(1) of the draft CGST/SGST Law and similarly, the respective State Tax Administration would, if so required, carry out audit and scrutiny of departments of the concerned State Government.
Agenda Item 3: Approval of the draft Union Territory Goods and Services Tax (UTGST) Law as vetted by the Ministry of Law & Justice, Government of India
8. Introducing this agenda item,
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TGST Law. The Council thereafter approved the draft UTGST Law along with the proposed changes.
9. For agenda item 3, the Council approved the draft UTGST Law with the changes as indicated in Annexure-4 of the Minutes (the changes as suggested in the meeting of the officers of the Centre and the States held on 16 March 2017 in New Delhi). The Council also authorised the Law Committee of Officers to make minor corrections and rectify typographical errors, wherever required, and that the revised UTGST Law shall be shared with the States.
Agenda Item 4.1: Amendments to the draft Integrated Goods and Services Tax (lGST) Law
10. Introducing this agenda item, the Secretary stated that certain changes were proposed in the draft IGST Law due to the strong concerns expressed by the Ministry of Commerce in respect of certain provisions of the draft IGST Law which could adversely affect the export competitiveness of the units working in Special Economic Zones (SEZs). He invited Shri Alok Chatur
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also from Value Added Tax in some States. He observed that in the IGST Law, the provision in respect of supplies to SEZs was to pay the tax first and to claim refund later. He added that the provision of refund, within seven days, of 90% of the amount of refund claimed was only provided for physical exports and was not available for supplies to SEZs. He further observed that the procedure of export under bond was not available for supplies from DT A to SEZs. He stated that due to such provisions, supplies from DT A to SEZ would be at a disadvantage vis-a-vis physical exports and as a result, SEZ units would be discouraged to source their raw material from DTA. He said that this would adversely affect the 'Make in India' campaign and would also be against the principle of ease of doing business. He therefore strongly suggested that supplies from DT A to SEZs should be treated at par with physical exports and both should be extended the same facilities.
10.2. The Secretary expl
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lete sub-Section 4 and to replace in sub-Section 3 the expression 'exporting goods and services or both' with the expression 'making zero rated supply'. He stated that some other small consequential changes were also suggested in sub-Section 3 of Section 16.
10.3. The Secretary stated that another concern in relation to exports that needed to be addressed related to cascading of input taxes for six products which were not under GST, namely the five petroleum products (petroleum crude, high speed diesel, motor spirit or petrol, natural gas and aviation turbine fuel) and alcoholic liquor for human consumption. He stated that the existing wording in sub-section 1 and sub-section 2 of Section 16 of the IGST Law gave the benefit of zero rating to only taxable supplies and thus exported petroleum products and alcoholic liquor would not be eligible to get refund of GST paid on the. inputs used in relation to such exported products. He stated that for petroleum products, input
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ter from Karnataka stated that GST was based on a seamless refund mechanism and if time-bound refunds were assured, the changes proposed for supply to SEZ were not required. He stated that the Council should not question the fundamentals of the efficacy of the refund mechanism under GST and the efficient functioning of the Goods and Services Tax Network (GSTN). He stated that an underlying tenet of GST was to get rid of the existing system of declarations, bonds, etc. and this should not be reintroduced for DT A supplies to SEZ. The Secretary pointed out that under the existing tax regime, goods could be bought from DT A for use in SEZ without payment of duty and that the new dispensation under GST should not be disadvantageous for supplies to SEZ. He observed that in order to avoid misuse and diversion of goods when supplied to SEZ, the principle to pay IGST first and then take refund was being introduced under the IGST Law but the old provision was continued for physical exports. He
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egments of business might seek a similar dispensation. He further observed that this issue had been debated several times in the Law Committee of Officers before the provision was drafted in the present form and that it should not be changed at this late stage. He suggested that this provision should be retained presently in the IGST Law, and in case it caused severe disadvantage to domestic suppliers, it could be amended later on and that such an amendment would be relatively easy to carry out as it was to be done only by the Parliament and not simultaneously by the State Legislatures.
10.6. The Secretary stated that one difference between the existing procedure and the procedure under GST would be that the existing Forms like I, H, C etc., were issued manually and this lent them to greater misuse whereas in the GST regime, there would be an all-India record of movement of goods through GSTN and that the Customs ICEGATE (Indian Customs Electronic Commerce/Electronic Data Interchange
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#39;ble Chairperson stated that it would not be advisable to discriminate between domestic supplies and imports to SEZs.
10.7 The Hon 'ble Chief Minister of Puducherry stated that exports through SEZs should be encouraged. He further stated that if a refinery was outside SEZ and they were given certain special facility, others would also claim the same. The Secretary stated that the facility of refund of input taxes on exported goods which were outside GST related to only 6 products and that, in the absence of such a provision, these goods would suffer loss of international competitiveness in the GST regime due to tax cascading. After further discussion, the Council approved the proposed changes to Section 16 of the draft IGST Law as contained in Annexure 5 of the Minutes.
10.8. The Secretary stated that as supply to SEZs was to be treated at par with physical exports, it would be desirable to carry out another consequential change in Section 54(6) of the CGST Law by replacing th
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eld on 4 March 2017), by replacing the word 'export' with the words 'zero rated supply'.
Agenda Item 4.2: Approval of the amendments to the draft Goods and Services Tax (Compensation to the States) Bill, 2017
12. Introducing this agenda item, the Secretary informed that in light of the approval of the CGST Law and the IGST Law with certain changes by the Council in its 11 th Meeting (held on 4 March 2017), certain consequential changes were required in the Goods and Services Tax (Compensation to the States) Bill, 2017. He further stated that ceiling rates for imposition of cess were also to be provided in the Compensation Law and on this account, certain consequential changes were proposed to Section 8 of the Goods and Services Tax (Compensation to the States) Bill, 2017 and a Schedule of ceiling rates of cess was presented for the approval of the Council. The Hon'ble Chairperson asked an officer to explain the method of arriving at the ceiling rates of cess. The
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been retained because this rate was already quite high and any further increase would have negative effect on other sectors of the economy. He stated that for aerated waters containing added sugar, there was a large dispersion of VAT rates and for calculating the ceiling rate of cess, the average of the highest and the second highest rate of VAT was taken and this was added to the existing rate of Central Excise and then, like in other cases, 28% of GST rate was subtracted and an additional 25% was added as a cushion and the resultant rate of 13% was rounded off to arrive at the ceiling rate of 15%. He stated that for motor cars, the proposed ceiling rate (15% ad valorem) was arrived at by summing up the existing rate of Central Excise and the highest existing rate of VAT, subtracting from it the GST rate of28% and then adding to it an additional 25% as a cushion. He stated that another residuary category of 15% ceiling rate was kept for all other supplies which would also include sup
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d at a rate of 65%. He observed that for 'sin' goods, there should be no special categorisation for poor people and that it was, in fact, more harmful for the poor people. The Hon'ble Chief Minister of Puducherry stated that the issue of employment was equally important. The Hon'ble Minister from Madhya Pradesh stated that he did not support the view of the Hon'ble Minister from Rajasthan. He observed that as 'Bidi' was a handmade product, it was a source of employment for a large number of people and that it was also smoked by the poor people. The Hon'ble Minister from Bihar stated that no cess be levied on 'Bidi' as it was a source of employment and also that it was smoked by poor people. The Hon'ble Minister from West Bengal pointed out that the Hon'ble Minister from Kerala had written a letter to the Hon'ble Chairperson pointing out that cess on 'Bidi' would affect about 3 crore 'Bidi' and 'Tendu Leaf collector
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nut farmers. He observed that it was wrong to give a favourable treatment to 'Bidi' vis-a-vis cigarettes on the ground that it was a poor man's 'puff as it caused greater harm than cigarettes. He observed that if a poor man got cancer due to his' Bidi' smoking habit, his family would be ruined as there was no social health care system for the poorer sections of the society whereas a cigarette smoker, being relatively better off, could still afford medical treatment for cancer. He warned that a huge burden was being cast on the poor man by allowing him his 'puff and that this burden finally fell on the society. He therefore suggested that the existing schedule covering both cigarette and 'Bidi' should be retained.
12.4. Shri P. Mara Pandiyan, Additional Chief Secretary, Kerala stated that the Hon'ble Minister from Kerala had written a letter dated 16 March, 2017 to the Hon'ble Chairperson stressing that' Bidi' should be exempted from
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mful. The Hon'ble Chairperson informed that the Central Government had power to levy Central Excise duty on 'Bidi' but due to considerations like large number of tobacco growers and workers involved in the 'Bidi' trade, during the last 8 to 9 years, it had refrained from imposing Central Excise duty on 'Bidi', though the Union Ministry of Health and the cigarette lobby had always argued for parity in the treatment of cigarette and 'Bidi' as the latter was equally harmful. He further stated that the decision to levy cess on 'Bidi' could be kept with the Council. The Hon'ble Minister from Assam stated that the enabling provision to levy cess on 'Bidi' should be retained in the law. The Hon'ble Minister from West Bengal reiterated that in the 4th Meeting of the Council (held on 3 and 4 November, 2016), it was decided to levy cess only on cigarette and chewing tobacco and therefore 'Bidi' should be left out of the scope of
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the GST regime. The Secretary observed that presently, the rate of Central Excise duty on 'Bidi' was Rs. 28 per thousand which translated to an ad valorem rate of 5% to 6% and that different States charged varying rates of VAT, for example Rajasthan (65%), Himachal Pradesh and Gujarat (22.5%), Tamil Nadu and Uttar Pradesh (14.5%) and Haryana (12.5%). He stated that the rate of tax on 'Bidi' and the issue of imposing cess on it could be addressed at a later date. The Hon'ble Minister from West Bengal suggested that the Council could take a decision to keep' Bidi' in the Schedule of cess but not impose any cess on it. The Hon'ble Minister from Karnataka stated that the Council should not arrive at any conclusion regarding leviability of cess on 'Bidi' at this stage. He stated that both awareness and the stick of taxation was required to combat the scourge of cancer. He observed that livelihood of one person could not be at the cost of life of anot
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hould be limited to aerated water with added sugar. The Secretary stated that cess could be limited to aerated water with added sugar and no cess-be put on packaged water as people should be encouraged to drink clean water. Shri Arvind Subramanian, Chief Economic Advisor, Government of India suggested that cess should also be charged on mineral water but the Hon'ble Minister from West Bengal disagreed with this suggestion.
12.8. The Secretary suggested that in order not to levy cess on lemonade which was covered under the description of the 6-digit HSN Code of 220 12, the description under the relevant 8-digit HSN Code, namely 22021010 could be adopted which covered only aerated water. The Hon'ble Minister from West Bengal stated that no cess should be levied on soda water. The Hon'ble Deputy Chief Minister of Gujarat supported this suggestion and observed that soda water was also consumed to relieve gastric trouble. The Secretary stated that the 8-digit Code 22021010 cove
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Deputy Chief Minister of Delhi observed that Entry at Serial No.6 of the Schedule was a residuary Entry excluding the products covered under Serial No.1 to 5 and, therefore, a more appropriate description for Entry under Serial No.6 would be 'Any other supplies' instead of the existing description 'All other supplies'. The Council agreed to the suggestion to change the description for Entry under Serial No.6.
13. For agenda item 4.2, the Council approved certain additional changes to Goods and Services Tax (Compensation to the States) Bill, 2017 which was earlier approved by the Council in its 10th Meeting (held on 18 February 2017) and also the Schedule of the rates of Cess to be part of the Goods and Services Tax (Compensation to the States) Bill, 2017. These approved changes are shown in Annexure-6 of the Minutes, subject to further modifications as recorded below:
13.1. In Serial No.4 of the Schedule, in column number (3), to replace the existing 6-digit HSN Code
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r free freight transport system across the country. He recalled that in the 11th Meeting of the Council (held on 4 March, 2017), Ms. Sujata Chaturvedi, CCT, Bihar had also suggested to consult with MoRTH while developing the e-Way Bill System in the GST regime. He stated that this agenda item was only to seek the approval of the Council to set up a Task Force of officers from the State Government Departments like Indirect Tax, Road Transport, State Excise and the Union Ministry of Road Transport and Highways and the Department of Revenue. This Task Force of officers, after their deliberations, could make a presentation to the Council suggesting measures to achieve seamless transport connectivity across the country. He added that subsequently, if required, there could be a joint meeting of the Hon'ble Ministers of Taxation and Transport to deliberate on this issue. He stated that those States which wanted to be represented in this Task Force should send a formal communication to the
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ouncil
17. The Hon'ble Chairperson observed with satisfaction that the five primary legislations, namely the CGST Law, the Model SGST Law, the IGST Law, the UTGST Law and the Compensation Law had been approved by the Council and that the next item of work would be to approve the GST Rules. The Secretary stated that earlier, five GST Rules were approved relating to Registration, Return, Payment, Refund and Invoice but due to changes made in the CGST, SGST and IGST Laws, these would require some amendments. He further stated that in addition, Rules on Input Tax Credit, Valuation, Composition and Transitional Provisions were being framed by the Law Committee of officers. On an enquiry by the Hon'ble Chairperson regarding the likely date for completing this task, CCT, Gujarat stated that these Rules were likely to be completed by 25 March, 2017. The Secretary stated that it was important that all GST Laws and Rules should be known to the trade at least three months before the impl
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ial Taxes
Minister Forest, Law &
Legislative Affairs
10
Jharkhand
11
Karnataka
12
Madhya Pradesh
13 Maharashtra
Shri Jayant Malaiya
Shri Deepak Kesarkar
14
Nagaland
Shri Y. Vikheho Swu
Shri C.P. Singh
Shri Krishna Byregowda
Minister – Urban Development &
Housing
Minister – Agriculture
Finance Minister
Minister of State Finance
Minister Roads & Bridges
15
Odisha
Shri Pradip Kumar Amat
Finance Minister
16
Rajasthan
Shri Rajpal Singh Shekhawat
Minister Industries
17
West Bengal
Dr. Amit Mitra
Finance Minister
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Annexure 2
List of officers who attended the 12th GST Council Meeting on 16 March 2017
S No
State/Centre
Name of the Officer
Charge
1
Govt. of India
Dr. Hasmukh Adhia
Revenue Secretary
2
Govt. of India
Shri Arvind Subramanian
Chief Economic Adviser
3 Ministry of Law
Shri Suresh Chandra
Secretary, Legal Affairs
4
Ministry of Law
Dr. G. Narayana Raju
Secretary, Legislative Department
5
Gov
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ia
Shri P.K. Jain
Deputy Commissioner
Additional Secretary, Legislative
Department
Additional Legislative Counsel
Deputy Legal Adviser
Additional Secretary, SEZ
Director, SEZ
Joint Secretary
Director General, DG-GST, CBEC
Principal Commissioner, (AR),
CESTAT, CBEC
Advisor (GST), CBEC
23
Govt. of India
Shri P.K. Mohanty
CHAIRMAN'S
INITIALS
24
Govt. of India
Shri D.S. Malik
ADG, Press, Ministry of Finance
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INITIALS
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S No
State/Centre
Name of the Officer
25
Govt. of India
Shri Alok Shukla
26
Govt. of India
Shri Upender Gupta
27
Govt. of India
Shri Udai Singh Kumawat
28
Govt. of India
Shri Amitabh Kumar
29
Govt. of India
Shri G.D. Lohani
30
Govt. of India
Shri Hemant Jain
31
Govt. of India
Ms. Aarti Saxena
32
Govt. of India
Shri Vishal Pratap Singh
33
Govt. of India
Shri Paras Sankhla
34
Govt. of India
Shri Siddharth Jain
35
Govt. of India
Shri Vipin Kumar Singh
36
GST Council
Shri Arun Goya
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Alam
Inspector
49
49
GST Council
Shri Ashish Tomar
Inspector
50 GST Council
Shri Alok Bharti
Inspector
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S No
State/Centre
51
GST Council
MINUTE BOOK
Name of the Officer
Shri Sharad Kumar Verma
Charge
Stenographer Grade-I
52
GST Council
Shri Sher Singh Meena
Tax Assistant
53 Andhra Pradesh
Shri J. Syamala Rao
54
54
Andhra Pradesh
Shri T. Ramesh Babu
Commissioner, Commercial Taxes
Additional Commissioner,
Commercial Taxes
55
55
Andhra Pradesh
Shri D.Venkateswara Rao
OSD, Revenue
56 Arunachal Pradesh
57
Assam
Superintendent, VAT
Commissioner, Commercial Taxes
58
Bihar
59
Bihar
60 Chhattisgarh
61 Delhi
Shri Nakut Padung
Shri Anurag Goel
Ms. Sujata Chaturvedi
Shri Arun Kr. Mishra
Ms. Sangeetha P
Shri H. Rajesh Prasad
Principal Secretary &
Commissioner, Commercial Taxes
Addl. Secretary, Commercial
Taxes
Commissioner, Commercial Taxes
Commissioner, VAT
62
62
Delhi
Shri Anand Kumar Tiwari
Additional Com
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arkhand
Shri Sanjay Kr. Prasad
77
Jharkhand
Shri G.S. Kapardar
Charge
Joint Commissioner (HQ)
Assistant Commissioner
78
Karnataka
Dr. M.P. Ravi Prasad
Joint Commissioner, Commercial
Taxes
79
Kerala
Shri P. Mara Pandiyan
80
Kerala
Dr. Rajan Khobragade
81
Madhya Pradesh
Shri Manoj Shrivastav
82 Madhya Pradesh
83 Madhya Pradesh
Shri Raghwendra Kumar
Singh
Shri Sudip Gupta
Shri Dhananjay Akhade
Shri R.K. Khurkishor Singh
84
Maharashtra
85 Manipur
86 Manipur
Shri Y. Indrakumar Singh
87
Mizoram
Shri L.H. Rosanga
88 Mizoram
Shri R. Zosiamliana
89 Nagaland
Shri Asangba Chuba Ao
90
Odisha
Shri Tuhin Kanta Pandey
91
Odisha
Shri Saswat Mishra
92
Odisha
Shri Sahadev Sahu
Shri G. Srinivas
Shri Rajeev Gupta
93 Puducherry
Dr. V. Candavelou
94 Puducherry
95 Punjab
96 Punjab
Shri Pawan Garg
97 Rajasthan
Shri Praveen Gupta
98 Rajasthan
Shri Alok Gupta
99 Rajasthan
Shri Ketan Sharma
CHAIRMAN'S
100
Sikkim
Shri Manoj Rai
INITIALS
Addition
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arakhand
Shri Amit Singh Negi
109
Uttarakhand
Shri Piyush Kumar
110
Uttarakhand
Shri Debapriya Bardhan
Shri Ranveer Singh
Chauhan
Shri Yashpal Singh
111 Uttar Pradesh
Shri R. K. Tiwari
112 Uttar Pradesh
Shri Mukesh Kumar
Meshram
113
Uttar Pradesh
Shri Vivek Kumar
114 Uttar Pradesh
Shri Niraj Kumar Maurya
115
West Bengal
Ms. Smaraki Mahapatra
116
West Bengal
Shri Khalid A. Anwar
117
GSTN
Shri Navin Kumar
Charge
Additional Chief Secretary
Additional Commissioner,
Commercial Taxes
Principal Secretary (Revenue)
Commissioner, Commercial Taxes
Joint Commissioner, Commercial
Taxes
Commissioner, Commercial Taxes
Commissioner, Commercial Taxes
Secretary, Finance
Addl. Commissioner, Commercial
Taxes
Deputy Commissioner,
Commercial Taxes
Additional Chief Secretary
Commissioner, Commercial Taxes
Additional Commissioner,
Commercial Taxes
Assistant Commissioner,
Commercial Taxes
Commissioner, Commercial Taxes
Senior Joint Commissioner,
Commercial
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of duty or tax
or cess on goods or services or both passed or made
before the commencement of this Act by the Legislature
or any authority or person having the power to make
such law, notification, order, rule or regulation;
Section 2 (95)
“regulations” means the regulations made by the
Commissioner Government under this Act on the
recommendations of the Council;
Similar change to be carried out in sections 165 and
166
Reason for change:
Power to lie with the Government and not the
Commissioner
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Section 2 (119)
“works contract” means a contract for building,
construction, fabrication, completion, erection,
installation, fitting out, improvement, modification,
repair, maintenance, renovation, alteration or
commissioning of any immovable property wherein
transfer of property in goods (whether as goods or in
some other form) is involved in the execution of such
contract;
Reason for change:
To align with the wording in the Co
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herwise, the transferee shall be liable to be registered,
with effect from the date on which the Registrar of
Companies issues a certificate of incorporation giving
effect to such order of the High Court or Tribunal.
Section 24
Notwithstanding anything contained in sub-section (1)
of section 22, the following categories of persons
undertaking taxable supplies shall be required to be
registered under this Act, –
this
Compulsory
registration
in certain
cases.
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Reason for change:
Persons making TDS and acting as ISD are not making
taxable supplies
Section 71(1)
(1) Any officer under this Act, authorised by the proper
officer not below the rank of Joint Commissioner, shall
have access to any place of business of a registered
person to inspect books of account, documents,
computers, computer programs, computer software
whether installed in a computer or otherwise and such
other things as he may re
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State of Punjab where
approximately 70% of the goods are sold under this
scheme
Access to
business
premises.
Note:
Any corresponding changes required in CGST Act may be permitted to be made
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Annexure-4
Amendments suggested to circulated draft UTGST Law in the 12th Meeting of the GST
Council
(All suggested changes indicated in 'bold', 'italics' and in 'strikethrough' mode):
Section 8
(4) Any notification issued by the Central Government
under sub-section (1) of section 11 or order issued under sub-
section (2) of the said section of the Central Goods and
Services Tax Act shall be deemed to be a notification or, as
the case may be, an order issued under this Act.
Reason for change:
Above changes have been suggested to ensure uniformity in
exemptions issued under various enactment if the same have
been recommended by the Council
Note: Similar change to be carried out in section 11(4) of the
SGST Act
–
CHAPTER IV
PAYMENT OF
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nd Services Tax Act, as reflected in
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Transfer of
input tax
credit.
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Ñи
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the valid return furnished under sub-section (1) of
section 39 of the Central Goods and Services Tax
Act, the amount collected as Union territory tax shall
stand reduced by an amount equal to such credit so
utilised and the Central Government shall transfer an
amount equal to the amount so reduced from the
Union territory tax account to the integrated tax
account in such manner and within such time as may
be prescribed.
Reasons for change:
Alignment of language with that in the CGST Law
CHAPTER VI
DEMANDS AND RECOVERY
10A.(1) A registered person who has paid the central Tax
tax and the Union territory tax on a transaction
considered by him to be an intra-State supply,
but which is subsequently held to be an inter-
State supply, shall be refunded the amount of
taxes so paid in such manner and subject to
such condition
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visions
of Central
Goods and
Services
Tax Act.
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ix. returns;
x. payment of tax;
xi. tax deduction at source;
xii. collection of tax at source;
xiii. assessment;
xiv. refunds;
xv. audit;
xvi.
inspection, search, seizure and arrest;
xvii.
demands and recovery;
xviii.
liability to pay in certain cases;
xix.
advance ruling;
XX.
appeals and revision;
xxi.
presumption as to documents;
xxii.
offences and penalties;
xxiii.
job work;
xxiv.
electronic commerce;
XXV.
settlement of funds;
xxvi.
transitional provisions; and
xxvii.
miscellaneous provisions including the
provisions relating to the imposition of
interest and penalty,
shall, mutatis mutandis, apply,-
(a) so far as may be, in relation to Union territory tax as
they apply in relation to central tax as if they were
enacted under this Act;
(b) subject to the following modifications and
alterations which the Central Government considers
necessary and desirab
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to “State tax or Union territory
tax” shall be deemed to be reference to
“Central tax”.
Reasons for change:
To complete the referencing of all taxes and authorities
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Annexure-5
Further amendments suggested to the IGST Law approved in the 11th Meeting of the GST
Council held on 4 March, 2017
(All suggested changes indicated in 'bold', 'italics' and in 'strikethrough' mode):
CHAPTER VII
ZERO RATED SUPPLY
Section 16 of IGST Act:
Zero
rated
(1)”zero rated supply” means any of the following taxable
supplies of goods or services or both, namely: –
supply
(a) export of goods or services or both; or
(b) supply of goods or services or both to a Special Economic
Zone developer or a Special Economic Zone unit.
(2) Subject to provisions of sub-section (5) of section 17of
the Central Goods and Services Tax Act, credit of input tax
may
be availed for making zero-rated supplies,
notwithstanding that such supply may be an exempt supply
o
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conomic Zone developer or a Special
Economic Zone unit receiving zero rated supply specified in
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clause (b) of sub-section (1) shall be eligible to claim refund
of integrated tax paid by the registered person on such
supply, subject to such conditions, safeguards—and
procedure as may be prescribed.
Reason for change:
Proposed to bring supplies to SEZ and physical exports at par
in order to avoid blocking of high amounts of working capital
in supplies to SEZ
CHAPTER-IX
MISCELLANEOUS PROVISIONS
20. Subject to the provisions of this Act and the rules Application
made thereunder, the provisions of Central Goods of
and Services Tax Act, relating to, –
i.
scope of supply;
ii.
iii.
time and value of supply;
composite supply and mixed supply;
provisions
of
Central
Goods and
Services
Tax Act.
iv.
input tax credit;
V.
registration;
vi.
tax invoice, credit and debit notes;
vii.
acco
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10th Meeting of the GST Council held on 18 February,
2017
(All suggested changes indicated in 'bold', 'italics' and in 'strikethrough' mode):
Section 2(1) “State” shall include –
(i)
for the purposes of sections 3, 4, 5, 6 and 7 the States as defined under the Central
Goods and Services Tax Act; and the Union territories with Legislature mentioned in the
First Schedule to the Constitution; and
(ii) for the purposes of sections 8, 9, 10, and 11, 12, 13 and 14 the States as defined
under the Central Goods and Services Tax Act, and Union territories defined under the Union
Territories Goods and Services Tax Act;
Section 7.
CALCULATION AND RELEASE OF COMPENSATION.
(3)(b) the actual revenue collected by a State in any financial year during the transition
period would be the actual revenue from State tax collected by the State and net of refunds
given by the said State under Chapters XI and XX VII of the State Goods and Services Tax
Act, the integrated goods and services tax
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ntra-State supplies of goods or services or both, as
provided for in section 97 of the Central Goods and Services Tax Act, and such inter-State
supplies of goods or services or both as provided for in section 5 of the Integrated Goods
and Services Tax Act, and collected in such manner as may be prescribed, on the
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recommendations of the Council, for the purposes of providing compensation to the States
for loss of revenue arising on account of implementation of the goods and services tax with
effect from the date from which the provisions of Central Goods and Services Tax Act is
brought into force, for a period of five years or for such period as may be prescribed on the
recommendation of the Council:
Provided that no such cess shall be leviable on supplies made by a taxable person who has
decided to opt for composition levy under section 10 8-of the Central Goods and Services
Tax Act.
(2) The cess shall
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value determined under the Customs Tariff Act, 1975.
Section 10. CREDITING PROCEEDS OF CESS TO FUND.
The proceeds of the cess leviable under section 8 and such other revenues amounts as may be
recommended by the Council, shall be credited to a non-lapsable Fund known as the Goods and
Services Tax Compensation Fund, which shall form part of the public account of India_and
shall be utilized for purposes specified in the said section
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1.
THE SCHEDULE
Notes
In this Schedule, reference to a “tariff item”, “heading”, “sub-heading” and “Chapter”,
wherever they occur, shall mean respectively a tariff item, heading, sub-heading and Chapter in the
First Schedule to the Customs Tariff Act, 1975 (Act No.51 of 1975)
2. The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (Act
No.51 of 1975), the Section and Chapter Notes and the General Explanatory Notes of the First
Schedule shall, so far as may be, apply to t
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