Goods and Services Tax

GST rates revised for snacks, AC units, & vehicle seats. Snacks 12%, Rail AC 28%, Two-wheeler seats 28%, Four-wheeler seats 28% from Oct 2024.
Circulars
GST – States
The CBIC clarified: Extruded/expanded savoury snacks under HS 1905 90 30 attract 12% GST prospectively from 10.10.2024, earlier 18% payable. Roof Mounted Package Unit Air Conditioners for Railways classified under HS 8415 attract 28% GST. Two-wheeler seats under HS 8714 attract 28% GST. Four-wheeler seats classified under H

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University Affiliation Services Taxable at 18% GST; Flying Courses Exempt; Helicopter Transport Taxed at 5% or 18% Based on Service.
Circulars
GST – States
The SC clarified that affiliation services provided by universities to colleges are taxable at 18% GST rate. Affiliation services by educational boards/councils to schools, except government schools, are taxable; GST liability is regularized from 1.7.2017 to 17.6.2021. DGCA-approved flying training courses by approved FTOs are exempt

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Advisory for Entry of Receipt Numbers Pertaining to Leased Wagons in the E-Way Bill System
GST
Dated:- 24-12-2024

Subject: Guidelines for Accurate Entry of Receipt Numbers in the E-Way Bill (EWB) System for Leased Wagons
Dear Taxpayers,
This advisory is issued to provide specific instructions for entering Receipt Numbers related to Leased Wagons in the E-Way Bill (EWB) system.
Advisories have already been issued regarding the correct format for entering Parcel Way Bill (PWB) numbers and Railway Receipt (RR) numbers for goods transported under the Parcel Management System (PMS) and the Freight Operations Information System (FOIS). This advisory focuses on the requirements specific to Leased Wagons.
1.Prefixing Receipt Numbe

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B of the EWB using the "Multi-Transport Mode" option on the EWB portal.
b) Enter the Receipt Number with the prefix "L" to indicate that the transport is via Leased Wagons.
3.Format for Number Entry in the EWB System
Taxpayers must use the following format when entering Receipt Numbers related to Leased Wagons:
L
Example:
For a Leased Wagon Receipt number: L123456789
4.Validation Process in the EWB System
Once the Receipt Number is entered:
a) The system will validate the entry against the designated database for Leased Wagons.
b) In case of discrepancies such as mismatched or missing numbers, taxpayers will receive an alert and must correct the entry promptly.
5. Assistance and Support
F

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High Court quashes late fee order on delayed GST returns before 01.04.2023, extends amnesty benefit for filings till 30.06.2023.
Case-Laws
GST
HC set aside order imposing late fee on petitioner for delayed GSTR-9/9C filing before 01.04.2023, holding petitioner entitled to benefit of amnesty notification N/N. 07/2023 dated 31.03.2023 exempting late fee for filings between 01.04.2023-30.06.2023. HC ruled differential treatment violative of Article 14, directed withdrawal of impugned order

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Stock transfer hiccup: Goods hauled despite e-way bill discrepancy, HC vindicates owner's rights.
Case-Laws
GST
Petitioner is owner of goods being transported as stock transfer from Orissa branch to Kanpur. HC held that when goods were intercepted, requisite documents under GST Act were accompanied and no discrepancy found regarding quantity, except in e-way bill transferee place was mentioned as Ghaziabad while in tax invoice it was Kanpur. As petitioner is consignor and consignee, bei

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Interim bail in GST evasion case due to lack of tax liability determination & cooperation.
Case-Laws
GST
Petitioner granted interim bail in GST evasion case. HC held arrest u/s 69 of CGST Act requires determination of tax liability by authorities, which was lacking. Despite power to arrest, continued detention at investigation stage not warranted as petitioner cooperated. Interim bail granted on personal bond of Rs. 1 lakh and bail bond with sureties, subject to conditions by CJM.
T

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High Court upholds show cause notice against firms involved in generating fake input tax credit through circular trading (2017-2022).
Case-Laws
GST
The HC dismissed the writ petition challenging the validity of the show cause notice (SCN) issued u/ss 74 and 122 of the CGST Act, 2017. The SCN was issued for generating fake input tax credit (ITC) through circular trading by multiple firms from 2017 to 2022. The HC held that joint assessment proceedings u/s 74 against all involved firms we

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Validity of GST Act section 174(2) on hold pending Supreme Court decision in X v. Y case.
Case-Laws
GST
The HC held that the challenge to section 174(2) of the GST Act, 2017 would be subject to the final outcome in the case of X v. Y [2024 (5) TMI 1498 – SC ORDER]. Till disposal of the SLP in X by the SC, interim orders passed by the HC in all respective cases shall continue to operate, subject to the final SC decision in X. The petition was disposed of.
TMI Updates – Highlights, qu

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Appellate authority must examine appeal merits even if documents not provided.
Case-Laws
GST
The HC allowed the petition challenging the order of the appellate authority dismissing the appeal. Despite being granted an opportunity to produce documents, the appellant did not do so. However, the HC held that under the Bihar Goods and Services Tax Act, particularly Section 107(8)-(12), the appellate authority has a duty to examine the merits and grounds raised in the appeal memorandum. Even

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Goods Transfer in FTWZ to DTA Classified as “Supply” Under CGST Act; IGST Applicable, No Input Tax Credit Reversal Needed.
Case-Laws
GST
Transfer of title of goods stored in Free Trade Warehousing Zone (FTWZ) by the appellant to customers in Domestic Tariff Area (DTA) or multiple transfers within FTWZ is covered under paragraph 8(a) of Schedule III of CGST Act, 2017 as “Supply of warehoused goods to any person before clearance for home consumption”. It does not fall under paragraph 8(b)

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Tax Dispute Resolution: Utilize Statutory Remedies Before Knocking Judicial Doors.
Case-Laws
GST
The HC dismissed the petition on the ground that efficacious alternative statutory remedies of appeal were available to the petitioner. Freezing of the petitioner's bank account did not violate principles of natural justice as it would not affect the petitioner's ability to institute an appeal by making the pre-deposit. The HC relied on precedents like Oberoi Constructions Ltd and Greatship

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Impugned order for IGST on SEZ to DTA supply quashed; import by DTA unit liable for IGST/duties.
Case-Laws
GST
The HC quashed the order raising demand for IGST on goods cleared from SEZ to DTA. The petitioner was not required to pay IGST on such supply as it is treated as import for DTA unit which is liable to pay IGST and duties. The respondent failed to consider provisions of Section 74 requiring adjudication of show cause notice by considering reply and provisions of the Act. The att

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Tax refund due for zero-rated exports to be recalculated as per CBIC circular, hearing opportunity given.
Case-Laws
GST
Petition remanded to respondent-Authorities to recalculate and process

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Taxable reimbursable expenses included in service valuation only from 14.05.2015.
Case-Laws
GST
The SC upheld the Delhi HC decision in Intercontinental Consultants & Technocrats Pvt. Ltd. vs. UOI, holding that reimbursable expenses incurred by the petitioner for providing taxable services under the Finance Act would form part of the valuation of taxable services for charging service tax only from 14.05.2015 by virtue of Section 67. Prior to this, such expenses could not be included. Con

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Court rejects plea for refund; statutory appeal route available despite Tribunal vacancy.
Case-Laws
GST
Petitioner challenged appellate orders rejecting refund applications. HC held there are no grounds to invoke extraordinary jurisdiction under Article 226 as statutory appeal lies before Tribunal. Though Tribunal is not constituted, Central Government permitted filing appeal after its constitution. Since impugned orders relate to refund with no demand, pre-deposit of 20% tax demand is

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Recommendations of the 55th Meeting of the GST Council
GST
Dated:- 21-12-2024

GST Council recommends reduction in GST rate on Fortified Rice Kernel (FRK), classifiable under 1904, to 5%
GST council also recommends to fully exempt GST on gene therapy
GST Council recommends exemption of GST on contributions by general insurance companies from third-party motor vehicle premiums for Motor Vehicle Accident Fund
GST Council recommends no GST on transaction of vouchers as they are neither supply of goods nor supply of services. The provisions related to vouchers is also being simplified.
GST Council clarifies that no GST is payable on 'penal charges' levied and collected by banks and NBFCs from borrowers for non-compliance with loan terms
GST Council recommends reduction of payment of pre-deposit for filing an appeal before the Appellate Authority in respect of an order passed which involves only penalty amount
Jaisalmer, Rajasthan, 21 st December 2024
The 55th GST Counci

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software meant assembly/manufacture of LRSAM system under Notification 19/2019-Customs.
* To reduce the rate of Compensation Cess to 0.1% on supplies to merchant exporters at par with GST rate on such supplies.
* To exempt from IGST imports of all equipment and consumable samples by Inspection Team of the International Atomic Energy Agency (IAEA) subject to specified conditions.
* To extend the concessional 5% GST rate on food inputs of food preparations under HSN 19 or 21 that are supplied for food preparations intended for free distribution to economically weaker sections under a government program subject to the existing conditions.
SERVICES
* To bring supply of the sponsorship services provided by the body corporates under Forward Charge Mechanism.
* To exempt GST on the contributions made by general insurance companies from the third-party motor vehicle premiums collected by them to the Motor Vehicle Accident Fund, constituted under section 164B of the Motor Vehicles Ac

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e changes to be made effective from 01.04.2025 to avoid any transition difficulties.
* To exclude taxpayers registered under composition levy scheme from the entry at Sr. No. 5AB introduced vide Notification No. 09/2024-CTR dated 08.10.2024 vide which renting of any commercial/ immovable property (other than residential dwelling) by unregistered person to registered person was brought under reverse charge mechanism. Further, to regularize the period from the date when the notification No. 09/2024-CTR dated 08.10.2024, became effective i.e. from 10.10.2024 till the date of issuance of the proposed notification on “as is where is” basis.
Other changes relating to goods and services
* To increase the GST rate from 12% to 18 % on sale of all old and used vehicles, including EVs other than those specified at 18% -Sale of old and used petrol vehicles of engine capacity of 1200 cc or more & of length of 4000 mm or more; diesel vehicles of engine capacity of 1500 cc or more & of length of

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spices are classifiable under HS 2106 90 99 and attracts 5% GST if supplied as other than pre-packaged and labelled and 12% GST if supplied as pre-packaged and labelled. However, when popcorn is mixed with sugar thereby changing its character to sugar confectionary (eg caramel popcorn), it would be classifiable under HS 1704 90 90 and attract 18% GST. It has been decided to regularise the issues for the past on “as is where is” basis.(Note: There is no new imposition of any tax in this regard and is merely a clarification as certain field units were demanding different tax rates on the same. Therefore, it is a clarification being recommended by the GST Council to settle the disputes arising out of interpretation.)
* To clarify that the Explanation in Sl. No. 52B in notification No. 1/2017- Compensation Cess (Rate) dated 28.6.2017 regarding ground clearance is applicable with effect from 26.07.2023.
* To clarify that RBI regulated Payment Aggregators are eligible for the exemption

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at par with the existing provision in GST for transactions in Customs bonded warehouse.
2. Issues pertaining to taxability of Vouchers
In a significant move to address long-standing concerns regarding the taxability of vouchers under GST, the GST Council made the following recommendations:
* To omit sections 12(4) and 13(4) from CGST Act, 2017 and rule 32(6) from CGST Rules, 2017 to resolve ambiguities in the treatment of vouchers.
* To issue clarification on the following issues:
(a) Transactions in vouchers shall be treated neither as a supply of goods nor as a supply of services.
(b) Distribution of vouchers on principal-to-principal basis shall not be subject to GST. However, where vouchers are distributed on principal-to-agent basis, the commission/fee or any other amount charged by the agent for such distribution is taxable under GST.
(c) Additional services such as advertisement, co-branding, marketing and promotion, customization and technology support, customer su

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CGST Act, 2017 in respect of goods which have been delivered by the supplier at his (supplier's) place of business : The GST Council recommended to clarify that in an Ex-Works contract, where goods are delivered by the supplier to the recipient or a transporter at the supplier's place of business, and the property in goods transfers to the recipient at that point, the goods are considered to be "received" by the recipient under section 16(2)(b) of CGST Act, 2017 and the recipient may claim Input Tax Credit (ITC) on such goods, subject to the conditions outlined in Sections 16 and 17 of the CGST Act, 2017.
(iii) Clarification regarding applicability of late fee for delay in furnishing of FORM GSTR-9C and providing waiver of late fee on delayed furnishing of FORM GSTR-9C for the period from 2017-18 to 2022-23:
(a) The GST Council recommended to clarify through a circular that the late fee under Section 47(2) of the CGST Act, 2017 is leviable for the delay in filing the

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d goods or the packages thereof. This will provide a legal framework for developing such a system and will help in implementation of mechanism for tracing specified commodities throughout the supply chain.
2. Clarification regarding recording of correct details of name of the State of the un-registered recipient as well as correct declaration of place of supply in respect of supply of 'Online Services'
* To clarify that in respect of supply of 'Online Services' such as supply of online money gaming, OIDAR services, etc. to unregistered recipients, the supplier is required to mandatorily record the name of the State of the unregistered recipient on the tax invoice and such name of State of recipient shall bedeemed to be the address on record of the recipient for the purpose of section 12(2)(b) of IGST Act, 2017 read with proviso to rule 46(f) of CGST Rules, 2017
D. OTHER MEASURES PERTAINING TO LAW & PROCEDURE
1. Amendment in section 17(5)(d) of CGST Act, 2017
* To align the p

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involving only demand of penalty without involving the demand of tax.
3. Amendment in section 2(69) of CGST Act, 2017 to insert an Explanation regarding definitions of Local Fund and Municipal Fund: To amend clause (c) of section 2(69) of CGST Act, 2017 and to insert an Explanation under the same to provide for definitions of the terms 'Local Fund' and 'Municipal Fund' used in the said clause.
4. Amendment in provisions pertaining to Input Services Distributor (ISD) mechanism under CGST Act, 2017 and CGST Rules, 2017
* To amend Section 2(61) and Section 20(1) of the CGST Act, 2017 to explicitly include inter-state RCM transactions under the ISD mechanism by including reference to supplies subject to tax under section 5(3) and 5(4) of IGST Act, 2017 in the said provisions.
* Consequentially, to amend section 20(2) of CGST Act, 2017 and rule 39(1A) of the CGST Rules, 2017.
* These, amendments in CGST Act, 2017 are to be made effective from 01.04.2025.
5. Provision for grant of

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he GST Council recommended inter-alia-
(i) To amend section 38 of CGST Act, 2017 and rule 60 of CGST Rules, 2017 to provide a legal framework in respect of generation of FORM GSTR-2B based on the action taken by the taxpayers on the Invoice Management System (IMS).
(ii) To amend section 34(2) of CGST Act, 2017, to specifically provide for requirement of reversal of input tax credit as is attributable to a credit note, by the recipient, to enable the reduction of output tax liability of the supplier.
(iii) To insert a new rule 67B in CGST Rules, 2017, to prescribe the manner in which the output tax liability of the supplier shall be adjusted against the credit note issued by him.
(iv) To amend section 39 (1) of CGST Act, 2017 and rule 61 of CGST Rules, 2017 to provide that FORM GSTR-3B of a tax period shall be allowed to be filed only after FORM GSTR-2B of the said tax period is made available on the portal.
E. OTHER MEASURES:
* The GST Council approved the recommendation of

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Excise duty penalty quashed due to lack of show-cause notice and opportunity of hearing.
Case-Laws
GST
The HC quashed the order demanding interest and penalty from the petitioner company on delayed payment of excise duty. The petitioner had voluntarily paid the duty after a Central Government audit. However, the authorities failed to issue a show cause notice and provide an opportunity of hearing to the petitioner before imposing interest and penalty u/ss 11AA and 11AC of the Excise Act

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Axis Bank ordered to transfer petitioner's funds; allow questioning tax Order on pre-deposit.
Case-Laws
GST
The HC directed Axis Bank, Bhayander Branch to transfer the entire amount in the petitioner's account to the Registrar within two weeks. The Registrar must transfer Rs.8,76,564/- to the 2nd respondent within two weeks of deposit, allowing the petitioner to question the Order-in-Original dated 25 May 2023 by depositing the pre-deposit amount. The appeal was disposed of.
TMI Upd

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Dismissal of petition challenging GST credit blocking for fake invoices.
Case-Laws
GST
The HC dismissed the writ petition. Rule 86A of the Central GST Rules, 2017 allows blocking of electronic credit ledger where ITC was obtained from fake/non-existent suppliers. Though the initial communication lacked detailed reasons, subsequent communications provided grounds for blocking ITC. Blocking ITC does not amount to recovery but prevents using ineligible ITC. Recording reasons initially in a

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Petition dismissed for refund of accumulated Input Tax Credit; ITC to be utilized for future tax liability.
Case-Laws
GST
The HC dismissed the petition for refund of unutilized ITC. It held that the petitioner had duly discharged output tax liability for March 2021 through electronic cash ledger, and the accumulated ITC in electronic credit ledger could be utilized for future tax liabilities. Since none of the conditions u/s 54(3) of CGST Act were met, the claim for refund of accumulate

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Tax mismatch dispute: Court quashes GST order, remands case for fresh decision after considering assessee's reply.
Case-Laws
GST
HC quashed final order dated 27 August 2024 passed by GST Officer in SCN proceedings against petitioner/assessee regarding mismatch between GSTR-3B and GSTR-1 disclosures. Matter remanded to GST Officer to decide afresh by passing reasoned order after considering petitioner's reply, with rights and contentions of parties kept open.
TMI Updates – Highlights

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High Court remands tax dispute over non-payment of IGST on import of shipping services for fresh decision.
Case-Laws
GST
The HC set aside the impugned order and remitted the matter back to the respondent to pass a fresh order considering the Supreme Court's judgment in Union of India & Anr. v. M/s Mohit Minerals Pvt. Ltd. on non-payment of IGST under reverse charge mechanism for import of services relating to transportation of goods by vessel. The writ petition was allowed by way of rem

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Tax assessment order quashed for non-mention of DIN as per law.
Case-Laws
GST
The HC set aside the impugned assessment order due to non-mention of DIN number, following earlier Division Bench

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Demat accounts frozen despite director resignation, violating natural justice. HC ordered relief, quashed freezing before due process.
Case-Laws
GST
Petitioner's demat accounts were attached/frozen despite ceasing to be director of company, violating natural justice principles. HC held prima facie petitioner's liability u/s 89 of MGST Act requires compliance with natural justice before attachment/freezing action. Relief granted quashing attachment/freezing of demat accounts, without pre

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Misclassification Show Cause Notice: Exhaust Adjudication First, Says HC Dismissing Challenge on Lower GST Rate Interpretation.
Case-Laws
GST
HC dismissed petition challenging show cause notice issued for alleged misclassification of product under incorrect HSN code attracting lower GST rate. HC held alternate remedy of adjudication had to be exhausted before approaching HC as no jurisdictional issue or violation of natural justice was involved. Petition dismissed with no order on costs

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