Goods and Services Tax

Tax registration revoked for not filing returns; Court grants relief to restart business on clearing dues.
Case-Laws
GST
Registration cancellation under WB GST/CGST Act due to non-filing of returns. Appeal rejected as time-barred u/s 107(4). Court observed petitioner's case did not involve tax evasion or dubious activities. Suspension/revocation would be counterproductive, impacting revenue recovery as petitioner cannot raise invoices or carry on business. Respondents directed to take p

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GST Exemption Under Entry 3B Inapplicable for Works Contract Services to Local Authorities.
Case-Laws
GST
This is a case regarding the applicability of GST exemption under Entry 3B of Notification No. 13/2017-CT (Rate) dated 28.06.2017 for services provided by the applicant to a local authority. The key points are: The applicant is engaged in providing 'works contract services' involving supply of goods along with services for an immovable property to Kotputli Municipal Council, a local

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Revised advisory issued – Hard – Locking of auto-populated liability in GSTR-3B
GST
Dated:- 18-10-2024

1. In order to assist taxpayers in filing their returns and minimizing human errors, GSTN has continuously improving the GST return filing process and in this endeavor the GST Portal now provides a pre-filled GSTR-3B form, where the tax liability is auto-populated from the declared supplies in GSTR-1/ GSTR-1A/ IFF by the supplier, while the Input Tax Credit (ITC) is auto-populated from GSTR-2B. A detailed system generated pdf of the auto populated GSTR-3B is also provided to all the taxpayers.
2. Now, taxpayers also have a facility to amend their incorrectly declared outward supplies in GSTR-1/IFF through GSTR-1A, allowing t

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Additional FAQs on IMS
GST
Dated:- 18-10-2024

Invoice Management System (IMS) is now available to taxpayers. This new system shall facilitate taxpayers in matching their records/invoices vis a vis issued by their suppliers for availing the correct Input Tax Credit (ITC). Taxpayers can now make use of this facility to seamlessly accept, reject, or keep invoices pending in the system to avail later as and when required. The first GSTR-2B on the basis of actions taken in IMS would be generated for the return period Oct'24 on 14th November, 2024. For some additional frequently asked questions (FAQs) on IMS to get a better understanding of the new functionality.
Thanking You,
Team GSTN
Additional FAQ on IMS
1
Which invoices are visible on IMS dashboard since 14th Oct 2024?
IMS is launched from GSTR-2B return period of Oct'24. Hence, all the records eligible for GSTR-2B of Oct'24 return period onwards will be made available on the IMS dashboard. All the invoices which

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When should an invoice/debit note be rejected?
Rejection of an invoice/debit note should be done very carefully as rejection will result in no ITC for the recipient.
A record may be rejected if it does not pertain to the recipient, or the detail of the record is erroneous to such an extent that CN and DN cannot handle the situation.
6
In light of the time limit to avail ITC being till 30th November for FY 2023-24 or furnishing of annual return whichever is earlier, how can the ITC of erroneously rejected invoice in IMS, be taken by the recipient in the FY 2023-24?
In case the recipient taxpayer erroneously rejects an invoice in IMS, then the same invoice can be accepted in IMS again before filing of GSTR 3B.
After accepting the said invoice, the recipient taxpayer should recompute the updated GSTR-2B for availing the credit in GSTR 3B for the FY 2023-24.
7
How can recipient accept a genuine credit note issued by supplier in IMS as it will result further reduction of t

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ejected by the recipient?
In the absence of linkage of Credit Note with the corresponding invoices, system cannot understand whether original invoice for this Credit Note was accepted or rejected.
Therefore, if the invoice is not correct, then it is advisable to rectify the mistake through amendment of invoices in the GSTR 1 instead of issuance of a Credit Note.
10
Can the Credit Note be kept as pending in IMS? If no, then why?
Credit Note cannot be kept pending in the IMS by the recipient as the supplier has reduced its outward tax liability at the time of issuance of credit note.
IMS does not change the existing flow where the documents/records reported by the supplier in the GSTR 1 is accepted and corresponding impact is reflected in the GSTR-2B. Now because of IMS, an additional option has been provided to recipient to reject the credit note if it does not belong to him.
11
Whether liability can be added in the same GSTR 3B in case where credit note has been rejecte

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Authority can issue second notice for additional GST discrepancies after initial explanation.
Case-Laws
GST
The High Court held that the respondent-authority had jurisdiction u/s 61 of the Jharkhand Goods and Services Tax Act, 2017 to issue a second show-cause notice seeking further explanation regarding discrepancies pointed out after the petitioner's response to the first show-cause notice. The Court opined that since the petitioner had furnished an explanation to the first notice, no

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Classifying supply as works contract. Eligibility for input tax credit on materials, labor, installation, overheads under contract execution modes.
Case-Laws
GST
Supply classified as works contract u/s 2(119) of CGST Act. Applicant executes deposit works on behalf of consumers/agencies under two modes. In second mode, applicant eligible for input tax credit on materials, labor, installation, and overheads as per Section 16, not blocked u/s 17(5). Ownership vests with applicant after con

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Vanilla Ice Cream Mix Classified for Tax Duty Under Food Preparations, Not Dairy Produce.
Case-Laws
GST
The authority classified the product “Vanilla Mix” – dried softy ice cream mix (low fat) in vanilla flavour under Heading 2106 90 99 of the First Schedule to the Tariff Act, attracting tax at 9% CGST and 9% SGST. It held that the product, comprising several ingredients intended for making soft serves, does not fall under Heading 0404 as a dairy produce. As per Chapter Note 5, food pre

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Case-Laws – GST – Highlights – The authority classified the product “Vanilla Mix” – dried softy ice cream mix (low fat) in vanilla flavour under Heading 2106 90 99 of the First Schedule to the Tariff Act, attracting tax at 9% CGST and 9% SGST. It held that the product, comprising several ingredients intended for making soft serves, does not fall under Heading 0404 as a dairy produce. As per Chapter Note 5, food preparations subjected to further processing for human consumption are covered under Heading 2106, which includes powders for ice-creams, preparations consisting of milk powder, sugar and other added ingredients, and powders for table cream, jellies, ice-cream and similar preparations. – TMI Updates – Highlights, quick notes, marquee, annotation, news, alerts Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com – TMI – TaxTMI – TMITax

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Sewerage System Works to Local Authority Attracts GST Despite Entry 3B Exemption.
Case-Laws
GST
Composite supply involving works contract services provided to local authority not exempt under GST. Entry 3B of Notification No. 13/2017-CT(Rate) exempting services to government authority not applicable as applicant providing works contract services with supply of goods exceeding 25% value. Entries 3, 3A and 3B interlinked, exemption limited to pure services or composite supply with goods v

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Petitioner's tax recovery during investigation before notice illegal; refund ordered.
Case-Laws
GST
The High Court held that the petitioner's contention of not having the power to recover amounts during the pendency of an investigation that commenced prior to the issuance of a show cause notice u/ss 67 and 70 is valid. The payments made by the petitioner cannot be considered self-ascertainment u/s 74(5) of the CGST Act, as the element of voluntariness is absent. Since the adjudication i

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Blocking Credit Ledger Without Hearing Violates Natural Justice; Court Quashes Illegal Order, Cites Rule 86A Breach.
Case-Laws
GST
The court held that blocking of the Electronic Credit Ledger without providing a pre-decisional hearing to the petitioner and without containing cogent reasons to believe in the impugned order violated the principles of natural justice. Relying on the precedent of K-9-ENTERPRISES, KWALITY METALS, K-9-INDUSTRIES VERSUS THE STATE OF KARNATAKA, THE ASSISTANT CO

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Mastermind nabbed for Rs. 175 cr GST fraud via fake invoices; bail nixed due to economic offence & flight risk.
Case-Laws
GST
Bail cancellation case involving fraudulent input tax credit and creation of fake invoices under GST Act. Court found no procedural lapses by authorities in arrest as summons were issued, reasons recorded, and arrest memo provided. Accused was mastermind causing Rs. 175.88 crore tax evasion. Risk of fleeing abroad and tampering evidence if granted bail. Bail canc

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Waiver of interest/penalty u/s 128A: Eligibility, process, payment of full tax, erroneous demands, transitional credits.
Circulars
GST
Various aspects related to the waiver of interest or penalty or both u/s 128A of the CGST Act. It clarifies eligibility criteria, application process, payment requirements, processing of applications, issuance of orders, and appeals. Key points include the time period covered, payment of full tax amount (excluding certain amounts), treatment of erroneous

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CGST Act Update: Retroactive Input Tax Credit Deadline Extension & Special Rectification Procedure for 2017-21.
Circulars
GST
Sub-section (5) and sub-section (6) inserted in section 16 of CGST Act retrospectively extend the time limit to avail input tax credit in certain specified cases pertaining to financial years 2017-18 to 2020-21. No refund of tax paid or input tax credit reversed is available where now eligible under sub-section (5) or (6). A special procedure notified allows rect

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Attention – Hard – Locking of auto-populated values in GSTR-3B
GST
Dated:- 17-10-2024

In order to assist taxpayers in filing their returns and minimizing human errors, GSTN has continuously improved the GST return filing process and in this endeavor the GST Portal now provides a pre-filled GSTR-3B form, where the tax liability is auto-populated from the declared supplies in GSTR-1/ GSTR-1A/ IFF, while the Input Tax Credit (ITC) is auto-populated from GSTR-2B. A detailed system generated pdf of the auto populated GSTR-3B is also provided to all the taxpayers.
2.Now, taxpayers also have a facility to amend their incorrectly declared outward supplies in GSTR-1/IFF through GSTR-1A, allowing them an opportunity to correct their

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Petition Dismissed: No Natural Justice Violation in Detailed Show Cause Notice; Court Urges Response to SCNs First.
Case-Laws
GST
The court dismissed the petition, holding that there was no violation of principles of natural justice due to alleged vagueness in the show cause notice (SCN). The SCN was detailed, providing complete information about the case to be addressed. The petitioners' reply was thorough, and no serious grievance was raised regarding vagueness. The court cited Suprem

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Statutory remedy of appeal takes precedence over writ petition, court exercises discretion.
Case-Laws
GST
Petition maintainable but not entertainable due to availability of statutory remedy of appeal. Supreme Court held that merely because petition is maintainable, court not obligated to entertain it. Discretion lies with court. If petitioner failed to raise objections before authority, can do so in appeal memo before appellate authority. Petitioner unable to show palpable injustice if

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Tobacco-lime mixture undergoes manufacturing process, classifying it as “manufactured chewing tobacco” liable to 28% GST and 160% Compensation Cess.
Case-Laws
GST
Tobacco pre-mixed with lime undergoes a manufacturing process involving mixing of lime paste, evaporation of water content, and addition of aroma, menthol, and moisturizer, resulting in a new product distinct from raw tobacco leaves. This process transforms the raw material into a marketable/consumable product for chewing need

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Foreign company's guarantee to Indian subsidiary for loans triggers GST under reverse charge.
Case-Laws
GST
GST is payable under reverse charge mechanism on issuance of corporate guarantee without consideration by foreign group company to Indian subsidiary for loan taken from banks/financial institutions. The time of supply is the date of entry in books of Indian recipient. Prior to 26.10.2023, GST is payable at the time of execution based on valuation u/r 28(1). Post 26.10.2023, GST is

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Mining royalty payments to Rajasthan govt attract 18% GST under RCM; upfront amounts before lease also liable.
Case-Laws
GST
GST is applicable on mining lease payments, including royalty, payable to the Government of Rajasthan under reverse charge mechanism (RCM) at 18% (9% CGST and 9% SGST). The applicant is liable to pay GST on upfront payments made as per tender conditions before issuing Letter of Intent (LOI) and after issuing LOI but before entering into the lease agreement, under

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Unfair order issued without hearing, petitioner to pay costs & file reply for reconsideration within 8 weeks.
Case-Laws
GST
Principles of natural justice and fair play were violated when the impugned order was issued without granting the petitioner an opportunity for a hearing. Despite the delay in responding to the show cause notice, the petitioner should be allowed to file a reply and be heard, subject to paying costs of Rs. 50,000/-. The respondent must dispose of the show cause noti

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Tax demand order overturned for lack of due process, petitioner gets chance to reply.
Case-Laws
GST
The High Court set aside the impugned tax demand order due to violation of principles of natural justice, as the petitioner was not provided a reasonable opportunity to contest the tax demand on merits. The petitioner was unaware of the proceedings culminating in the order, which related to a mismatch between the petitioner's GSTR 3B returns and the auto-populated GSTR 2A. The court permi

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GST Liable on Indian Railways Charges: Applicant Not a Pure Agent, Must Pay GST on Various Fees and Charges Under CGST Rules.
Case-Laws
GST
The applicant is required to pay GST on the charges paid to Indian Railways for various services received, as the applicant is the recipient of these services from Indian Railways, and not a pure agent. The applicant has sub-contracted the task of paying these charges to the operator, who is required to pay the applicant along with GST as per their

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Important advisory for GSTR-9/9C
GST
Dated:- 15-10-2024

Starting FY 2023-24, GST system will auto-populate eligible ITC for domestic supplies (excluding reverse charge and imports ITC) from table 3(I) of GSTR-2B to table 8A of GSTR-9. These changes in GSTR-9 and 9C for the FY 2023-24 will be available on the GST portal from today i.e.,15th October 2024 onwards.
Further, a validation utility will be executed progressively (for validation by taxpayers) to complete the auto populatio

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Attention – Advisory on IMS
GST
Dated:- 15-10-2024

Invoice Management System (IMS) is made available to taxpayers from Today, 14th Oct, 2024. The new system shall facilitate taxpayers in matching their records/invoices vis a vis issued by their suppliers for availing the correct Input Tax Credit (ITC). Taxpayers can make use of this system to take action on the invoices reflecting on IMS from 14th Oct, 2024. The first GSTR-2B would be generated for the return period Oct' 24 on 14th

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