Goods and Services Tax

Goods and Services Tax – GST – By: – Sanjeev Singhal – Dated:- 30-11-2017 – Audit word Speculate that what type of audit is inserted in CGST Act, 2017. Audit can be done by chartered Accountants/ Cost Accountants or by Department itself. Audit by Chartered Accountants / Cost Accountants u/s 35[5] of the CGST Act. Audit by Department u/s 65 of the CGST Act. Special Audit by Chartered Accountants / Cost Accountants u/s 66 of the CGST Act. Before I describe the various audit , it is necessary to understand the word audit which has been defined in Section 2[13] of the CGST Act,2017 which is as follows. Audit means the examination of records, returns and other documents maintained or furnished by the registered person under this Act or the rule

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cise audit of any registered person for such a period. Period of audit may be financial year or multiple thereof. Rule 101(1) Registered person shall be issued notice at least 15 working days before the start of audit as may be prescribed. Notice shall be issued on Form -GST ADT-01 Audit above shall be completed within period of 3 months from the start of the audit. Where the audit can not be completed within 15 days , commissioner may extend the same for further period not exceeding six months to complete the same for reason written in writing. Authorized officer during the course of audit may ask for necessary facility to verify the books of accounts. After the conclusion of audit , proper officer within 30 days, inform the registered per

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ner. Intimation to RP shall be provided on Form ADT-03 of Rules 102 of CGST Rules, 2017. Auditor as mentioned above will provide report within 90 days, duly signed to concerned Asst. commissioner. Registered person shall be informed the finding of this report on Form- GST ADT 04. of Rule 102 (2) of CGST Rules. The assistant commissioner may extend this period of 90 days for further period of 90 days for reason in writing. Special audit under section 66 shall have effect despite the registered person is being audited under provision of the Act or any other law for the time being in force. The expenses of audit and remuneration of special auditors shall be paid by the commissioner. Where the result of special audit is tax short paid, not paid

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Goods and Services Tax – GST – By: – Pradeep Jain – Dated:- 30-11-2017 – In past two updates, we have discussed the various aspects of Joint Development Agreements in GST regime. In these updates, we have analyzed the provisions which state that GST is payable by the builder even on the flats transferred to land owner even though no consideration is received in cash. It will be taxable as the consideration is received in kind in form of land development rights. We have also done the valuation aspect of such flats that are being transferred to the land owner. In this update, we shall discuss the liability arising on part of land owner, when he further sells these flats. In normal parlance, in tri-partite agreements; the under-construction f

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the list of activities that will be treated as supply of goods or supply of services . Clause 5(b) to this schedule reads as follows:- (b) construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier. The above language clearly speaks that the construction of complex, building or civil structure or a part thereof for sale to buyer except where the entire consideration has been received after issuance of completion certificate or after its first occupation whiche

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Customs – PUBLIC NOTICE No. 60/2017 – Dated:- 30-11-2017 – OFFICE OF THE COMMISSIONER OF CUSTOMS, NEW CUSTOM HOUSE, KANDLA-370 210 F. No. S/20-07/AG/GST/17-18 Dated: 30.11.2017 PUBLIC NOTICE No. 60/2017 Subject: Applicability of IGST / GST on goods transferred I sold while being deposited in a warehouse. -reg. Attention of all Exporters, Customs Brokers, Members of the Trade and Industry and other stakeholder is invited towards CBE & C's Circular No. 46/2017-Cus dated 24.11.2017 issued through F. No. 473/10/2017-LC on the above mentioned subject matter 2. Ch IX of the Customs Act, 1962 provides for deposit of goods into a Customs bonded Warehouse licensed under Section 57 or 58 or 58A without payment of duty and the procedures to be followed with respect to the warehoused goods. Sub- section (5) of Section 59 provides that the importer is at liberty to transfer the ownership of such goods to another person while the goods remain deposited in the warehouse. 3. It is to be noted

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stage of ex-bonding on the value determined under Section 14 of the Customs Act. 4. However, the transaction of sale I transfer etc. of the warehoused goods between the importer and any other person may be at a price higher than the assessable value of such goods. Such a transaction squarely falls within the definition of 'Supply" as per Section 7 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as, CGST Act" for short) and shall be taxable in terms Of Section 9 of the CGST Act read with section 20 of the Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as, "IGST Act" for short). It may be noted that as per sub-section (2) of Section 7 of the IGST Act, any supply of imported goods which takes place before they cross the Customs frontiers of India, shall be treated as an inter-State supply. Thus, such a transaction of sale/transfer will be subject to IGST under the IGST Act. The value of such supply shall be determined

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017. 5.2 However, it may be noted that so long as such goods remain deposited in the warehouse the Customs duty to be collected shall remain deferred. Further, it is only when such goods are ex-bonded under Section 68, shall the deferred duty be collected, at the value as had been determined under Section 14 of the Customs Act, 1962 in addition to IGST leviable, as indicated at Para 5.1 above. An illustrative chart on in-bond sales and clearance thereof is below. Sale of goods in a Bonded Warehouse and clearance thereof: ILLUSTRATION Goods imported by "A" on 2nd July 2017. Importer wants to deposit the goods in a bonded Warehouse to defer duty. Importer files an "into bond bill of entry and the goods are deposited in a Bonded Warehouse. BCD and IGST (Section 3(7) of Customs Tariff Act 1975) are deferred. Illustration of duty deferment: A: Value of goods = ₹ 100 B: say BCD is 10% = ₹ 10 (10% of ₹ 100) C: say IGST is 12% = ₹ 13.2 (12% of ₹ 110

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Customs – PUBLIC NOTICE No. 38/2017 – Dated:- 30-11-2017 – OFFICE OF THE COMMISSIONER OF CUSTOMS, CITY CUSTOMS COMMISSIONERATE, P.B No. 5400, C.R.BUILDING, QUEEN S ROAD, BENGALURU – 560 001 C.N0. VIII/09/41/2017 City cus Tech Date: 30.11.2017 PUBLIC NOTICE No. 38/2017 Subject: Applicability of IGST / GST on goods transferred / sold while being deposited in a warehouse-Reg. Attention of all Customs Brokers, Exporters, Importers, Members of the Trade and other stake holders is invited to Board's Circular No. 46/2017 -Customs dated 24.11.2017 regarding applicability of IGST / GST on goods transferred / sold while being deposited in a warehouse. 2. References have been received from the trade regarding levy of IGST/GST on sales of goods de

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demurrage charges or costs for customs clearing or transporting the goods from the port to the customs bonded warehouse or costs of storage at the customs bonded warehouse, cannot be added to the value of the goods, for the purpose of levy of duties of customs at the stage of ex-bonding. Further, clause (b) of sub-section (1) of Section 15 of the Customs Act provides that the rate of duty or tariff valuation for an ex-bond Bill of Entry shall be the date on which it is filed. There is no provision to vary the assessable value of the goods at the ex-bond stage unless they are such goods on which tariff valuation applies. Therefore, duties of customs (BCD + IGST) shall be paid on the imported goods at the stage of ex-bonding on the value det

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ustoms frontiers of India, shall be treated as an inter-State supply. Thus, such a transaction of sale/ transfer will be subject to IGST under the IGST Act. The value of such supply shall be determined in terms of section 15 of the CGST Act read with section 20 of the IGST Act and the rules made thereunder, without prejudice to the fact that customs duty (which includes BCD and applicable IGST payable under the Customs Tariff Act) will be levied and collected at the ex-bond stage. 6. Thus, in respect of goods stored in a customs bonded warehouse, there is a possibility that certain cases may involve an additional taxable event, if a transfer of ownership of warehoused goods takes place between the importer and another person, before clearan

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2017 (11) TMI 1628 – BOMBAY HIGH COURT – TMI – Cargo Handling Service – the issue was pending before Larger Bench – Held that: – the issue pending for decision of the Larger Bench is involved in all these appeals and the Tribunal, therefore, could not have remanded the matter back to the Adjudicating Authority, but should have waited for decision of the Larger Bench – issue notice to respondents. – CENTRAL EXCISE APPEAL NO. 26 OF 2017 Dated:- 30-11-2017 – PRASANNA B. VARALE & ARUN D. UPADHYE, JJ. Mr. S. N. Bhattad, Advocate for the petitioner. ORDER Heard the learned counsel for the appellant. The learned counsel submitted that before the Tribunal, there were two issues for consideration. Out of these two issues, the issue of Cargo Ha

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2017 (12) TMI 685 – MADRAS HIGH COURT – TMI – Writ of Prohibition – tour operator services and/or travel agent services – if the petitioners have rendered tour operator services and/or travel agent services to other than those, who are either Haj or Umra pilgrims, the second respondent has to examine as to how such transactions have to be assessed? – Services rendered to Indian Haj and Umra pilgrims, who go to Saudi Arabia – petitioners' case is that such services are fully exempt by relying upon the Notifications dated 30.10.2009 and 20.8.2014 – Held that: – This Court does not wish to express anything on the merits of the matter and it is made clear that a decision would be taken by the second respondent in accordance with law after perusal of the documents produced by the petitioners. It is reiterated that on production of the records, the second respondent shall examine as to what are the types of services rendered by the petitioners and in case the second respondent is of the opi

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e writ petitions is identical, all the writ petitions are taken up for joint disposal. 2. The petitioners seek for the issuance of a Writ of Prohibition to prohibit the second respondent from holding any enquiry or assessment or raising demand in furtherance of the proceedings of the second respondent dated 11.9.2017/12.9.2017 and the summons dated 13.11.2017. By proceedings dated 11.9.2017/12.9.2017, the second respondent sent notices to the respective petitioners calling upon them to produce their balance sheets and profit and loss account statements for the years 2012-13 to 2016-17 along with income tax returns, reconciliation of balance sheet for the said periods, details of taxable value received/invoices raised and service tax paid/to be paid/if any, for the periods from 01.4.2012 to 30.6.2017, details of input service credit, sample copies of invoices, service tax paid under reverse charge, brief write up about the petitioners' business activities, copies of respective servi

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009, the CBEC clarified that service tax is not chargeable on the services provided in respect the tour undertaken for carrying out Haj and Umra pilgrimage in Saudi Arabia by Indian pilgrims considering the same as 'export of service' provided they fulfill the other conditions of export as provided in the Export of Service Rules. By referring to the Notification dated 20.8.2014, it is further submitted that the Central Government directed that service tax payable under Section 66B of the Finance Act, 1994 on the services provided by the said specified organizations in respect of a religious pilgrimage facilitated by the Ministry of External Affairs, Government of India, under the bilateral arrangement during 01.7.2012 to 19.8.2014, but for the said practice, shall not be required to be paid. 5. Therefore, it is also submitted that the second respondent has no jurisdiction to compel the petitioners to produce the documents called for, as the services rendered by them are fully e

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vision of taxable service. It is also submitted that the Delhi High Court took note of the decision rendered by the Customs, Excise and Service Tax Appellate Tribunal in the case of Cox & Kings India Limited Vs. Commissioner [reported in (2014) 35 STR 817 (Tri-Del.)] wherein it was held that service tax cannot be levied with regard to outbound tours arranged for Indians by the Indian tour operators, since it was a service provided outside the taxable territory of India and that the Finance Act did not have extra territorial operation. 7. The learned Senior Counsel has further submitted that in the instant case, the question of production of records does not arise and the petitioners can be called upon to produce the records only in respect of such of the services, which have been rendered by them not covered under the Exemption Notification for the Haj and Umra pilgrimage service. 8. On the contrary, the learned Senior Panel Counsel appearing for the Department would submit that th

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t this stage would be premature, as the petitioners, who are all registered under the provisions of the Finance Act and are rendering tour operator services and/or travel agent services, are bound to produce the records before the second respondent for necessary perusal and consequential proceedings. 10. There are two aspects that require to be looked into by the second respondent, if such records are produced. Firstly, if the petitioners have rendered tour operator services and/or travel agent services to other than those, who are either Haj or Umra pilgrims, the second respondent has to examine as to how such transactions have to be assessed. The second aspect is with regard to the services rendered for Indian Haj and Umra pilgrims, who go to Saudi Arabia. To examine both these points, it is essential that records from the petitioners are called for and without examining the records, a decision cannot be arrived at. 11. With regard to the second aspect, namely with regard to the serv

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usal of the documents produced by the petitioners. It is reiterated that on production of the records, the second respondent shall examine as to what are the types of services rendered by the petitioners and in case the second respondent is of the opinion that the services rendered by the petitioners to the Indian Haj and Umra pilgrims are liable for service tax, it is needless to state that the second respondent shall afford an opportunity of personal hearing by way of issuing a show cause notice, so that the petitioners will be able to canvass the contentions raised before this Court in these writ petitions. 13. Hence, this Court holds that the prayer sought for in these writ petitions is premature. Accordingly, the writ petitions are dismissed. No costs. Consequently, the connected WMPs are also dismissed. 14. The petitioners are directed to cooperate with the proceedings before the second respondent and produce all the records with liberty to raise all the legal contentions put for

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Lt. Governor of the National Capital Territory of Delhi appointed Assistant Commissioner of State Tax and Goods and Services Tax Inspector – GST – States – F. 3(67)/Fin.(Rev.-I)/2017-18/DS-VI/780 – Dated:- 30-11-2017 – Notification No. F. 3(67)/Fin.(Rev.-I)/2017-18/DS-VI/780 Delhi, the 30th November, 2017 In exercise of the powers conferred by Section 3 of the Delhi Goods and Services Tax Act, 2017 and in exercise of the power conferred by clause (a) of sub-section (2) of section 66 of the Delhi Value Added Tax Act, 2004 (Delhi Act 03 of 2005), the Lt. Governor of the National Capital Territory of Delhi, is pleased to appoint the following officers for discharging of statutory duties under these Act as per the acts enforce and with effect f

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2017 (12) TMI 341 – ALLAHABAD HIGH COURT – [2018] 1 GSTL 12 (All) – Detention of goods – absence of Transit Declaration Form (TDF) – mis-description of goods – Refined Palm Oil – penalty – Section 129(1) of UP GST Act – Held that: – at the stage of seizure the detaining authority had not applied his mind, nor formed any opinion as to intention to evade tax. The only allegation made in the seizure order is to the effect that the TDF is absent and that the goods have been mis-described. There is no allegation whatsoever as to the intention of the petitioner to evade tax.
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In absence of any allegation or evasion of tax being made against the petitioner at the stage of detention and seizure and even at the stage of issuance of notice of penalty, it is difficult to sustain the penalty.
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As to absence of TDF, though it amounted to a breach of the Rules, yet, in the entirety of the facts & circumstances of this case, as admitted to the revenue, it does appear that goods were being

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– Hon'ble Bharati Sapru And Hon'ble Saumitra Dayal Singh, JJ. For the Petitioner : Shubham Agrawal For the Respondent : C.S.C.,A.S.G.I. ORDER Heard Shri Shubham Agrawal, learned counsel for the petitioner and Shri C.B. Tripathi , learned Standing Counsel for the department. This writ petition has been filed by the consignor of the goods to challenge the order dated 03.11.2017 passed by the respondent no.4, Assistant Commissioner, U.P. Goods & Services Tax, Mobile Squad-II, Gorakhpur, under Section 129(1) of the U.P. GST Act(hereinafter referred to as the 'Act) and the order dated 08.11.2017 passed under Section 129(3) of the Act imposing penalty of ₹ 9,54,325/-. The petitioner claims to be a registered dealer at Rajasthan who sold 130 bags of sweet supari valuing at ₹ 66,17,500 to M/s S.G. Enterprises at Assam against Tax Invoice No.52. In that invoice the petitioner has disclosed to have charged IGST @ 18 per cent. By another Tax Invoice No.51, the petition

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einafter referred to as the 'Rules'). It also appears that the detaining authority was not satisfied as to the identity of the goods being same as that mentioned in the tax invoice with respect to the Palm Oil. According to the detaining authority, the goods were 'Ujala Shudh Deshi Ghee'. The petitioner on it's part stated that due to inadvertent mistake on part of the truck driver, transit declaration form had not been downloaded and therefore, it was not found accompanying the goods. However, it is the case of the petitioner that undisputedly the goods have originated from State of Rajasthan and were being transported to Assam through the State of U.P. At the time of detention they were near their exit point in the State of U.P., for onward journey to Assam. There is also no dispute as to the identity of the other consignment of 'sweet supari'. Then on 03.11.2017, the seizure orders appears to have been passed, which records two reasons. First, seizure has

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rder on 08.11.2017 wherein the reason given for imposition of penalty are the absence of TDF as also the different identity of the goods namely 'Ujala Shudh Deshi Ghee' having been found in place of Refined Palm Oil. It has also been mentioned for the first time that the assessee had intention to evade payment of tax with the object of selling the goods inside the State of U.P. At the outset, Shri C.B. Tripathi, learned counsel for the revenue has raised a preliminary objection as to the maintainability of the writ petition in view of alternative remedy being available to the petitioner against the penalty order. Responding to the above, Shri Shubham Agrawal learned counsel for the petitioner submits that the seizure and penalty orders are wholly without jurisdiction and therefore, the bar of alternative remedy may not apply. Also, he submits that no appellate authority has yet been constituted under the Act. Therefore, the remedy of appeal is not available to the petitioner. I

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ion 129(1) of the Act. For the purpose of Section 129(1) of the Act, it is not only necessary for the revenue to establish that there is a technical violation of the Act and/or the Rules framed thereunder but that such a violation has a revenue impact inasmuch as the revenue is burdened to specifically allege and establish that the alleged violation of the Act and/or the Rules, as may be alleged, has been caused by the assessee with intention to evade payment of tax. It is thus submitted that in the instant case the first real allegation that arises is the absence of TDF. However, in view of the fact that full details of the transactions and place of its origin and also its destination were found mentioned in the tax invoice and other documents found accompanying the goods, in the first instance there was prima facie evidence in support of the claim raised by the petitioner that the goods were passing through the State of U.P and were not meant to be unloaded, consumed or sold inside t

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imposable merely because the TDF was not found accompanying the goods. Though all other documents were found accompanying to support the contention of the assessee that the goods were merely passing through the State of U.P. Then, as to the difference in the identity of the goods namely Refined Palm Oil as alleged by the revenue, learned counsel for the petitioner submits that in the first place there is no difference as alleged inasmuch as on the packing a different description has been mentioned but the real identity of the goods is as described in the tax invoice i.e. Refined Palm Oil. Then, it is submitted that difference in the quantity or quality or description of the goods that are admittedly passing through the State of U.P. is of no consequence to the State revenue authorities inasmuch as such a difference has no revenue impact. Once it is admitted or established on record that the goods were only passing through State of U.P., the role of the U.P. authorities was minimal and

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in the invoice it was not mentioned that the goods would be transferred in another vehicle and no explanation in this regard has been given is irrelevant. What had been happened prior to the arrival of the vehicle at the entry check post is wholly irrelevant. The objection of the check post officer that a different goods were found than the goods mentioned in the challan is also baseless. Perusal of the challan shows that the goods mentioned is cereal Based Blanded Food (Sattu). Show cause notice says that on verification it was found that in the packing, constituents of the goods mentioned are wheat, sugar, rice, soyabeen, vitamin and mineral. Therefore, in my opinion, there was no difference in the goods mentioned in the invoice and the goods mentioned in the packing. The items mentioned in packing are the constituent of the Cereal Based Blanded Food for which invoice was issued. The word "Sattu" is mentioned in bracket. It is seen that one particular item is called by dif

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he Uttaranchal Trade Tax Act shows that movement of goods started from Rajasthan and was going to Uttaranchal and was not intended for import inside the State of U.P. The provision of section 28-A of the Act is not applicable. The inference of an intent to evade tax is based on suspicion and merely on surmises and conjectures and on irrelevant consideration. Therefore, the check post officer has erred in refusing to issue transit pass and seizing the goods and the Tribunal has erred in confirming the seizure of the goods." Reliance has also been placed on another judgment of a learned Single Judge passed in S.G. Express Vs. Commissioner of Trade Tax, U.P. reported in [2011] 37 VST 35(All) wherein following the judgment of M/s Murliwala Agrotech Limited (supra), the learned Single Judge held as follows:- "In M/s Murliwala Agrotech Ltd. Vs. Commissioner of Trade Tax, U.P. Lucknow 2005 NTN (28) 198 it has been held by this Court that the goods being transported through U.P. cann

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submits that under Section 129(1) of the Act, the goods are exposed to seizure and penalty the moment there is a violation of the Act or the Rules. In so far as it is not disputed that the transaction involved transit of goods through the State of U.P. the goods should have been accompanied with TDF, over and above the Tax Invoice and other documents of transportation of goods. The contravention was thus complete and no further fact or intention was required to be established by the revenue to either seize the goods or impose the penalty. In this regard, Shri C.B. Tripahti, learned counsel for the revenue submits that the TDF was never produced by the petitioner up to the stage of imposition of penalty, as it first appears to have downloaded on 15.11.2017 i.e. one week after the penalty order. As to the merits of the penalty order which also bearing the preliminary objection raised by Shri C.B. Tripathi, learned Standing Counsel as to the existence of alternative remedy, he submits th

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imposed on account of his intention to evade tax. The only allegation up to the stage of issuance of the penalty show-cause notice, therefore, appears to be that the petitioner had contravened the provisions of the Act and therefore exposed itself to the penalty. However, in the penalty order, almost in the passing the respondent no.4 has recorded that the petitioner had intention to evade tax by unloading the goods inside the State of U.P. However, as a fact petitioner has not been found to have unloaded the goods. Also, neither such allegation was made against the petitioner at any prior stage nor the petitioner was called upon to furnish any reply nor there is any evidence in this regard. The observation made in the penalty order is, therefore, only an afterthought. The same cannot be relied upon by the State to justify the imposition of penalty. In absence of any allegation or evasion of tax being made against the petitioner at the stage of detention and seizure and even at the st

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Central Excise – 1061/10/2017-CX – Dated:- 30-11-2017 – Circular No. 1061/10/2017-CX F.No.116/15/2017-CX-3 Government of India Ministry of Finance Department of Revenue Central Board of Excise & Customs New Delhi , Dated: November 30, 2017 To The Principal Chief Commissioner/ Chief Commissioner of GST & Central Excise (Chandigarh, Meerut, Kolkata and Shillong zone) DG, GSTI, New Delhi Pr. CCA, CBEC DG, DG Audit, New Delhi Subject: Procedure for manual disbursal of budgetary support under Goods and Service Tax Regime to the units located in States of Jammu & Kashmir, Uttarakhand, Himachal Pradesh and North East including Sikkim. -reg. Attention is invited to the Circular No. 1060/9/2017-CX dated 27.11.2017 issued by the Board on the above subject. In terms of para 10 of the aforesaid circular a separate circular on the manner of allocation of the budget by DIPP and direct transfer of the sanctioned amount into bank accounts of the beneficiaries through PFMS was also require

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for budgetary support shall determine the tentative amount of budget allocation required for disposal of all the pending applications. The budget requirement shall be forwarded by the CGST Commissionerates in respect of all the Divisions in their jurisdiction to ADG, DG Audit, New Delhi who has been nominated as the nodal officer for the scheme by the Board. The DDO Code and PAO Code of the concerned Division & Commissionerate and amount required by each of the Division shall also be indicated in the requirement. The ADG, DG Audit would compile the requirement and forward it to the concerned Scheme Division of the DIPP with a copy endorsed to the Pr. CCA, CBEC. (ii) Scheme Division of the DIPP on the basis of requirement received from ADG, DG Audit would issue a Letter of Budget Authorization through the Pr. Accounts Office, DIPP in favour of the Pr. Accounts Office, CBEC on PFMS portal allocating/authorizing the budget in favour of each of the DDO duly mapped to a specific PAO, CB

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payments against such authorization will be dealt by the provision of IGAA Module of PFMS. For further details with regard to the authorization of budget through PFMS, the User Manual as available at http://cga.nic.in//writereaddata/file/FinalMODIFIEDLOAUSERMANUAL2509 2017.pdf may be referred. 4. Sanction and payment of budgetary support: (i) After the sanction of the budgetary support, a sanction order addressed to concerned Pay and Accounts Officer shall be issued by the jurisdictional Assistant/Deputy Commissioner of CGST Division in duplicate, a copy of which shall be endorsed to DDO for preparation of the bill. The sanction order should, inter alia contain the detailed Account Head and the beneficiary details along with the amount to be paid. (ii) The Assistant/Deputy Commissioner shall also act as Programme Division (PD) on PFMS portal and prepare the sanction on PFMS and forward it online to concerned DDO. It should be ensured by the Programme Division that the sufficient budge

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Goods and Services Tax – Exporters advised to file Table 6A and GSTR 3B for processing of IGST Refund and for Refund of the unutilized Input Tax Credit; – TMI Updates – Highlights

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Goods and Services Tax – GST – By: – Rakesh Chitkara – Dated:- 29-11-2017 Last Replied Date:- 29-11-2017 – GST Research Foundation (GRF) consisting of professionals practicing in the field of GST made a detailed representation to Sh. Dheeraj Rastogi, Hon ble Commissioner GST Council & Member of High Powered Committee on Return filing. The Hon ble Commissioner has responded in his communication of 28.11.2017 : Thanks all of you for sending a number of valuable suggestions. The meeting on Return Simplification today held preliminary discussion on the issue and the course of action to be taken.. The brief outline of the discussion and points for consideration were as follows: Short Term issues affecting return filing and compliance Long Term Compliance regime to be put in place It was felt that let the Long term direction be finalised first and then one can adjust Short Term Compliance issues accordingly so that it does not result into changing/ redesigning system too often. Points f

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ns and they may be of incremental nature pre-supposing certain things. This structured way of approaching the problem will result in a comprehensive suggestion for consideration and implementation. As regards, Short Term issues affecting return filing and compliance are concerned, these may be finalised after the Long Term ones are finalised. Further, many of them may be in the nature of bugs in the current system or malfunction of Software. All such issues which pertain to be in the nature of bugs in the current system or malfunction of Software, will be flagged separately to GSTN. Suggestions from above perspective (will) be taken up in the next meeting. TEXT OF THE REPRESENTATION : At the outset we humbly thank the Committee on GST returns for giving us this opportunity of highlighting major problems faced by Trade and Professionals while filing Goods and Services Tax ( GST ) Returns. Humble attempt has been made by professionals across India with the sole objective of maximising us

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f and Filing: Any return has no legal sanctity or meaning in the eyes of law till returned data is signed. Right now taxpayer has to got through multiple steps of uploading data, save, submission, set off and then finally signing it. This creates lots of confusion amongst taxpayer community and simple form is being treated as a bulky one. The difference between Saved, Submit and Filed should be removed and it should be replaced with a simple process of Sign and Submit . Till the point return is Signed and submitted , user/taxpayer should be able to change any data in his return, as he deems fit. 3. No facility to preview taxpayer s net tax liability A Taxpayer s net liability is computed after adjusting ITC already available, fresh ITC and balance available in Cash Ledger. Right now, purview and submit option only display Gross Output Liability as well as Gross ITC being claimed in tax period. Once the preview and submit option is clicked, the system should auto calculate and display t

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Tax in table 3.1(a). Online table 3.1 of form 3B should be enabled to accept values other than positive values. 5. Details asked for in form 3B is bulky and has no direct relation with GST Liability Table no. 3.2 (further bifurcation of interstate supplies to Unregistered persons and Composition Taxable Persons) and Table no. 5 (Value of Exempt, Nil – rated and Non GST Inward Supplies) Please remove the details asked in table no. 3.2 & 5 as it has no tax impact. In any case, tax liability is already captured from table 3.1. 6. Absence of Differential Due Dates Due date of Small as well as Big Tax Payer s falls on same on due date. This creates pressure on system and reduce response time of system. Allow differential dates for filing. This will give server breathing space as well. GSTN has already implemented this system while fixing Due Date of GSTR-1 for the month of July 2017 wherein differential due date of 3rd November 2017 was fixed for Taxpayers having Turnover of more than 1

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arge taxpayers returns are filed by large team of consultants and in case of small taxpayers returns are generally filed by small taxpayers themselves. Thus, system for revision of return should be allowed. Law should not penalize taxpayers for small errors rather than it should be taxpayer friendly. 9 No Quick fix solution for Tax Payment made under Wrong Head. If for any reason while making Tax Payment, major code or minor code is wrongly inserted, in absence of GSTR-3, working capital of Tax Payer is getting blocked. Option to apply for refund of excess in cash ledger should be enabled in form 3B as well. A lot of people have paid tax in wrong heads and are unable to utilise it. This option is available only in table 14 of GSTR 3 filing of which is being delayed. Or In other words, a table similar to table 14 of GSTR-3 should be incorporated in 3B as well. Alternatively Table 14 of GSTR 3 to be made a separate module (just like Table 6A of GSTR-1 (or GSTR 1-E) so that in case of wro

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left blank) Suggestions in respect of Form GSTR-1 Sl Issues Suggestion 1. Offline Tool provided for GSTR-1 is not comprehensive enough. Right now a taxpayer has to be mandatorily use certain tables of online form, as a part of return filing process since present offline tool is not comprehensive enough to handle all tables of GSTR-1 and GSTR-2 The offline tool should contain all sections like documents details section. Eg., Table 8, Table 9, Table 13 etc. are missing in present offline version 2.1 released by GSTN. 2. Saving of Invoice data online takes lot of time It takes a lot of time and effort to save the data and filing. Time taken by GSTN to update and show data generally varies from 1 day or more. For better user acceptability this should be reduced to few minutes. Correcting/Deleting bulk data online is a mammoth task and very cumbersome. Please simplify the entire process of filing GSTR-1. There should be a delete all / reset option for the entries uploaded. If a wrong file i

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eturns like ITC-04 etc.) even on big tax payers is unnecessarily increasing compliance cost, more so now with Quarterly filing of GSTR 1, 2 & 3 by small taxpayers even matching concept has shifted to quarterly basis. Return filing periodicity must be made quarterly for all taxpayer for GSTR-1, 2 or 3, as government is any way collecting its tax only monthly basis through GSTR-3B or in alternate only for Taxpayers having turnover of more than 100 cr be required to file Monthly GSTR-1, 2 & 3 and rest be permitted to file Quarterly Returns. Further Due date of filing GST Returns for big and small Tax Payer should fall on different due date for effective server response 5. Dichotomy in date of Liability vis-a-vis eligible ITC for newly registered Taxpayers. Once Taxpayer has applied for GST Registration, there is no legal justification for permitting ITC only from the date of issuance of registration certificate. Taxpayer s ITC of intervening period (from date of liability to date

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invoice value is more than ₹ 2.5 lakh and Table no. 7: Taxable supplies (Net of debit notes and credit notes) to unregistered persons other than the supplies covered in Table 5 both should be combined in one Table There should be only 2 Tables: B2B & B2C. More number of tables, creates unintended errors and increase compliance overall time. 8. Export refunds stuck due to mismatch in Table 6A and icegate data Many export refunds are stuck due to wrong quoting of invoice particulars in GSTR-1. This issue is more aggravated due to lack of availability of GSTR-1 of August 2017 As filing of GSTR-1 of August is not enabled as of today, at least edit option for Table 6A of July 2017 return should be introduced online immediately. 9 Three separate statements/returns for one Tax period is too burdensome. Instead of three different returns viz GSTR-1, 2 and 3 one combined Return be prescribed. Every Taxpayer should be allowed to file such Combined Return on Quarterly basis. Thereafter

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ayer needs to upload just the purchases and automatically GSTN system should figure out the mismatch invoices. Matching every single entry manually from thousands of entries by Tax payer is not practicable. Instead of invoice wise matching, GSTIN wise matching should be implemented or in other words Instead of Invoice level matching it should be supplier to buyer level matching. 2 Input, input service or capital good segregation information should be removed. Selecting such details on Invoice level is highly time consuming. Furthermore GSTR-2 gives option to taxpayer to select ineligible credit at invoice level as well as at gross level separately. Option to select eligibility/ineligibility first at invoice level and then at gross level serves no real purpose. Collecting such trivial details should be avoided or in the alternate only summary details be asked in GSTR-2. Further Invoice level selection of eligibility/ineligibility should be removed for ease of compliance. 3 Recipient is

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thly / quarterly returns. 5 No option available for of consolidated Accept / Reject / Keep Pending actions Presently Taxpayer can take such action only on a single invoice at a time. This takes lot of time and energy of Taxpayers. Option to accept / Reject / Keep Pending multiple invoices should be provided in online mode. 6. No option available for auto populated Import Bill of entry in GSTR-2 Bill of entry details to be auto populated from the customs portal (ICEGATE) to reduce further mismatch between customs & GSTR 2 captured. (this space has been intentionally left blank) Common Suggestion for GSTR 1 & 2 S.No. Issues Suggestion 1 HSN code HSN code requirement for each and every Commodities / Services is very cumbersome Only for Top 10 (Ten) Commodities / Services HSN codes should be asked for. This will effectively securer Revenue Interest and will make system user friendly with wide acceptability. 2. HSN Summary and multiple UQC Presently HSN summary allows only one UQC.

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be available with offline tool also. 6. One cash ledger instead of separate cash ledger(s) Credit in Cash ledger is segregated into different heads which makes taxpayers unable to set off the cash credit of one head for other, which can be possible if there is a uniform cash ledger without minor codes. E.g.: If a person has 1,000/- in interest & a short amount of ₹ 100/- in late fee then again, he need to transfer amount from Bank Account although an excess amount is lying Electronic cash ledger. It is suggested that in cash ledger there should only be one major head without any minor heads. GSTN offset facility is capable of capturing Tax payment into major heads viz IGST / CGST / SGST and minor heads Viz. Tax/ Interest / Late fees / Penalties etc for Government Accounting Purpose. Present Income Tax TDS System allows such payment/offsetting without getting into Major and Minor code successfully. Others misc. suggestions S.No. Issues Suggestion 1 No Automatic Transfer of PL

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ee. GST Research Foundation is a society integrating the Tax Assessees, Tax Administrators, Tax Practitioners, Judiciary, Academics and Government Policy Makers across 30 States, 9 Union Territories and Central Government in India for deriving cutting edge economic and taxation policies for development of the nation on community serving model and is compliant with UN 2030 Sustainable Development Goals Agenda. Presentation prepared by: GST Research Foundation (GRF) CA. Atal Bhanja CA. Deepak Bholusaria CA. Jignesh Kansara Convenor Committee Member Committee Member Under Guidance of: Adv. Rakesh Chitkara With active support of: CA. Harini Shridharan, CA. Divya Bansal, Mr. M P Vasudevan, CA. Ramakant Hemani, Mr.Gawesh Narula, CA. MONISH, CA. Deepak Kucheria, CA. Sanjay sharma, CA. Mitesh Gogri, Mr. Sanjay, CA. Bharat Rattan, CA. Guruprasad , CA. Kishore, CA. Arpit Haldia, CA. Iqbal Singh Grover, CA. Shweta Nahar, CA. Avijit kumar, CA. Annapurna Srikanth, CA. Kidhin D Panjabi, Mr. U S Para

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Goods and Services Tax – GST – Dated:- 29-11-2017 – Exporters advised to file Table 6A and GSTR 3B for processing of IGST Refund and for Refund of the unutilized Input Tax Credit; Errors by exporters while filing their returns are the sole reason for delay in grant of refunds or rejection thereof; The Government of India has taken various measures to alleviate difficulty and is fully committed to provide Speedy disbursal of Refunds due to exporters. The Government of India is seized of the issue of Exporters complaining about delay in grant of refunds pertaining to Integrated Goods and Services Tax (IGST) paid on goods exported out of India and similarly Input Tax credit (ITC) on exports. Media reports with incorrect estimations of refund

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d of IGST paid are filing of GSTR 3 B and table 6A of GSTR 1 on the GSTN portal and Shipping Bill(s) on Customs EDI System by the exporter. It is essential that exporters should ensure that there is no discrepancy in the information furnished in Table 6A of GSTR 1 and the Shipping Bill. It has been observed that certain common errors such as incorrect Shipping Bill number in GSTR1, mis-match of invoice number and IGST amount paid, wrong bank account etc. are being committed by exporters while filing their returns. These errors are the sole reason for delay in grant of refunds, or rejection thereof. While information has been made available to Exporters on the ICEGATE portal if they are registered, they may also contact jurisdictional Custom

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refund of the unutilized Input Tax Credit on inputs or input services used in making exports is concerned, exporters shall file an application in FORM GST RFD- 01A on the Common Portal where the amount claimed as refund shall get debited from the Electronic Credit Ledger of the exporter to the extent of the claim. Thereafter, a proof of debit (ARN- Acknowledgement Receipt Number) shall be generated on the GSTN portal, which is to be mentioned on the print-out of the FORM GST RFD-01A and to be submitted manually to the jurisdictional officer. The exporters may ensure that all the necessary documentary evidences are submitted along with the Form GST RFD 01A for timely sanction of refund. Exporters are, therefore, advised to immediately file

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Goods and Services Tax – Problems faced by assessees in filing of GST Returns – Presentation as submitted by the Society for Tax Analysis and Research (STAR) – TMI Updates – Highlights

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Goods and Services Tax – GST – Dated:- 29-11-2017 – Society for Tax Analysis and Research (STAR) has made the following representation before Sh. Dheeraj Rastogi ji, Commissioner – GST Council, Member – High Powered Committee on Return filing: At the outset we humbly thank the government for this wonderful initiative wherein this esteemed committee has been formed to consider the problems faced by the taxpayers in filing of their Goods and Services Tax ( GST ) Returns. GST is believed to be a good and simple tax. A system was for the first time casted by the Government (GST Network( GSTN )) to capture billions of transactions that take place in our economy and that too on a monthly basis. However, the professionals and the tax payers have faced multiple problems as the GSTN system was struggling with its own challenges of handling such huge volume of transactions. We are hopeful that with this esteemed Committee in place, the taxpayers and professionals will find respite from their pr

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seen dip in certain month may have Nil return in certain months. In such cases also, the requirement to file all 3 returns and 3B is not warranted. In cases where return is Nil, a simple option of nil return if selected should automatically fill nil data for all parts and allow filing in one go. 3. Invoice wise reporting Invoice wise reporting of B2B transactions has increased the work manifold in case of many businesses. While the same is of no use to any government, as the motive has always been matching of data, such huge amount of detail has caused problems in terms of data submissions and filing. Invoice wise data submission requires precise accuracy in filling details in prescribed format and also increase the file size of data being uploaded to GSTN. This results is repeated failure in uploading large size filed and also limits the capacity of GSTN to handle more data. In case of B2B transactions, partywise details of supply and tax along with place of supply be taken and option

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g of his previous return. Blockage of subsequent return might increase non compliance to a level where even a genuine taxpayer might find it impossible to cope up with the filing of all returns together if the resolution of his problem takes some months. 5. Different Submission and filing requirements: For a taxpayer, till the return is not filed, there is no acceptance of the data he has put into the GSTN. More particularly, the law also requires filing of return without any legal authority given to submission of data which is not signed such data. There should be no blockage of data submitted till the return is filed. The taxpayer should be able to amend all details till he file the return after payment of tax. In case of any wrong application of tax before filing of return, an option be given to reverse such application of tax or revise the data submitted as before filing of return with valid signature, no such submission is valid and is of legal consequence. 6. Submission of HSN su

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while collating the information, system itself does not allow such functionalty. Payment of tax should be 8. Cross transfer of tax amongst CGST, SGST and IGST is not allowed There have been instances where the taxpayer or his personnel, in sheer ignorance or by fault, pays tax under a different head than required for eg. CGST in place of SGST. The cash while it is lying with government treasury, gets blocked and cannot be used for payment of tax. Moreso, taxpayers with limited resources find it impossible to deposit tax again. Thus, while the money of the taxpayer is An option of automatic refund of money lying in cash account of the taxpayer be given si that any balance lying in cash ledger be credited back to taxpayer by next working day. This requires no checking or scrutiny on part of proper officer as such money has not been offered or applied as tax by the taxpayer and thus, its his own money which he should be able to withdraw and which should be credited in the bank account giv

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business compulsion. Return filing for all new registrations be allowed from July and this mistake be ignored till taxbase is settled in GST. This would increase compliance and shall reimpose faith of small taxpayers in the system 11. Safety of taxpayer s Input Tax Credit ( ITC ) in absence of GSTR 2 Section 16 allows credit of ITC to recipient only when the same is paid by the supplier. However, in case where GSTR 2 is not being filed, the reconciliation system is not available to the recipient to verify his ITC. By the time such system is in place, there are chances that such ingenuine taxpayers might elope with taxes paid to them by genuine taxpayers. This gains important when the rate of tax are in the bracket of 12%, 18% and 28% and when cess is also paid. Strong monitoring is required of all fly by night operators who have taken registration to defraud genuine tax payers and who shall not be found once the system shall be working in another four months. High value transactions b

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plier will be found incorrect. Only PAN details of such persons be given and in absence of PAN, name and address of such persons should be considered as proper compliance. 13. Differences in decimals in invoice and tax There are instances where the detail of invoice value and tax as filed in GSTR 1 by the taxpayer is in decimals while the recipient reflects the same in nearest rupee. The same results in a mismatch more particularly in a voluminous data. The identification of such issues requires intelligent IT softwares which are costly for the taxpayer. Auto adjustment / rounding off of invoice value or tax to nearest lower rupee value if the claim of the recipient is lower than the supplier detail as recipient has not filled the value in paise in tax. 14. Simultaneous filing of all returns The spread over 20 days for filing of returns – GSTR 1, 2 and 3 has diverted attention of taxpayer from their business to compliance. The filing of three parts of the return is seen as three return

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g another registration and then raising of invoice on ISD post payment of tax etc. which is more of a stop gap arrangement rather than proper solution on part of taxpayers. Option of such payment under reverse charge and compliance thereof be given as part of GSTR 6 since it is distributing credit to respective units and such liability of payment of tax cannot be distributed under any circumstance to different units. We thank you for this opportunity to present our representation on behalf of all members of Society for Tax Analysis and Research( STAR ). Our Society is a not for profit Society which aims to disseminate proper information of tax to masses and to act as a catalyst between government and taxpayers and other stakeholders in bringing an efficient, transparent and corruption free nation. We trust our suggestions would find space in your consideration and report. Presentation prepared by: Society for Tax Analysis and Research (STAR) (CA Man Mohan Gupta) (Suresh Aggarwal, Advoc

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GST – States – G.O.Ms.No. 268 – Dated:- 29-11-2017 – GOVERNMENT OF TELANGANA Revenue (Commercial Taxes-II) Department G.O.Ms.No. 268 Dated: 29-11-2017 NOTIFICATION In exercise of the powers conferred by section 164 of the Telangana Goods and Services Tax Act, 2017 (23 of 2017), the State Government hereby makes the following Rules further to amend the Telangana Goods and Services Tax Rules, 2017, namely:- 1. (i) These Rules may be called the Telangana Goods and Services Tax (4th Amendment) Rules, 2017. (ii) Save as otherwise provided in these Rules, they shall come into force on the date of their publication in the Official Gazette. 2. In the Telangana Goods and Services Tax Rules, 2017, (hereinafter referred to as the principal rules), in rule 3, – (i) after sub-rule (3), with effect from 15th day of September, 2017, the following sub-rule shall be inserted, namely:- (3A) Notwithstanding anything contained in sub-rules (1), (2) and (3), a person who has been granted registration on a

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s, letters and word, 30th September , the figures, letters and word 31st October shall be substituted; 4. In the principal rules, in rule 118, with effect from 29th day of September, 2017, for the words a period of ninety days of the appointed day , the words and figures the period specified in rule 117 or such further period as extended by the Commissioner shall be substituted; 5. In the principal rules, in rule 119, with effect from 29th day of September, 2017, for the words ninety days of the appointed day , the words and figures the period specified in rule 117 or such further period as extended by the Commissioner shall be substituted; 6. In the principal rules, in rule 120, with effect from 29th day of September, 2017, for the words ninety days of the appointed day , the words and figures the period specified in rule 117 or such further period as extended by the Commissioner shall be substituted; 7. In the principal rules, after Rule 120, with effect from 15th day of September, 2

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re admissible to him when holding an equivalent Group 'A' post in the Government of India: Provided that where a retired officer is selected as a Technical Member, he shall be paid a monthly salary equal to his last drawn salary reduced by the amount of pension in accordance with the recommendations of the Seventh Pay Commission, as accepted by the Central Government."; (ii) in sub-rule (4), after the first proviso, the following proviso shall be inserted, namely:- "Provided further that upon the recommendations of the Council and subject to an opportunity of being heard, the Central Government may terminate the appointment of the Chairman at any time."; (iii) in sub-rule (5), after the first proviso, the following proviso shall be inserted, namely:- "Provided further that upon the recommendations of the Council and subject to an opportunity of being heard, the Central Government may terminate the appointment of a Technical Member at any time."; 10. In

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ssion handicraft goods has the meaning as assigned to it in the G.O.Ms No.266, Revenue (CT- II) Department, Dt.29-11-2017. 12. In the principal Rules, with effect from the 1st day of July, 2017, in FORM GST TRAN-1 , (i) in Serial No. 5(a), in the heading, after the words, figures and brackets Section 140(1) , the words, figures, brackets and letter , Section 140 (4) (a) and Section 140(9) shall be inserted; (ii) in Serial No. 7(a), in the table, in Serial No. 7A, in the heading, after the word invoices , the words, brackets and letters (including Credit Transfer Document (CTD)) shall be inserted; (iii) after the words Designation/Status , the following shall be inserted, namely;- Instructions: 1. Central Tax credit in terms of sub-section (9) of section 140 of the CGST Act, 2017 shall be availed in column 6 of table 5 (a). 2. Registered persons availing credit through Credit Transfer Document (CTD) shall also file TRANS 3 besides availing credit in table 7A under the heading inputs. ;

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State Government appoints the 18th day of September, 2017 as the date on which the provisions of sub-section (1) of section 51 of the Telangana Goods and Services Tax Act, 2017 shall come into force – GST – States – G.O.Ms.No. 267 – Dated:- 29-11-2017 – GOVERNMENT OF TELANGANA Revenue (Commercial Taxes-II) Department G.O.Ms.No. 267 Dated: 29-11-2017 NOTIFICATION In exercise of the powers conferred by sub-section (3) of section 1 of the Telangana Goods and Services Tax Act, 2017 (23 of 2017), the State Government hereby appoints the 18th day of September, 2017 as the date on which the provisions of sub-section (1) of section 51 of the said Act shall come into force with respect to persons specified under clauses (a) and (b) of sub- section (

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GST – States – 51/2017-State Tax – Dated:- 29-11-2017 – Government of Himachal Pradesh Excise and Taxation Department Dated: Shimla-171002, the 29th November, 2017 Notification No. 51/2017-State Tax No.EXN-F(10)-41/2017.- In exercise of the powers conferred by section 164 of the Himachal Pradesh Goods and Services Tax Act, 2017 (10 of 2017), the Governor of Himachal Pradesh is pleased to make the following rules further to amend the Himachal Pradesh Goods and Services Tax Rules, 2017, namely:- (1) These rules may be called the Himachal Pradesh Goods and Services Tax (Thirteenth Amendment) Rules, 2017. (2) They shall come into force on the date of their publication in the Official Gazette. 2. In the Himachal Pradesh Goods and Services Tax R

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as been extended in exercise of the powers conferred under section 37 of the Act, the supplier shall furnish the information relating to exports as specified in Table 6A of FORM GSTR-1 after the return in FORM GSTR-3B has been furnished and the same shall be transmitted electronically by the common portal to the system designated by the Customs: Provided further that the information in Table 6A furnished under the first proviso shall be auto-drafted in FORM GSTR-1 for the said tax period. ; (iv) in rule 96A, in sub-rule (2), the following provisos shall be inserted, namely:- Provided that where the date for furnishing the details of outward supplies in FORM GSTR-1 for a tax period has been extended in exercise of the powers conferred under

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Goods and Services Tax – GST – Dated:- 28-11-2017 – In an immediate follow up action of last week's Cabinet approval for creation of the posts of Chairman and Technical Members of the National Anti-profiteering Authority under GST, the Government today issued orders appointing senior IAS officer Shri B.N. Sharma, as the first Chairman of this apex Authority in the rank of Secretary to Government of India. Shri B.N. Sharma, an IAS officer of 1985 batch belonging to Rajasthan cadre, is currently posted as Additional Secretary in the Department of Revenue, Ministry of Finance. Shri B.N. Sharma has been closely associated with the formulation of GST and its implementation. He has also worked as Additional Secretary in the Ministry of Power

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an and of the other officials as Technical Members of the Authority were issued on the recommendation of a high level Selection Committee headed by Shri P.K. Sinha, Cabinet Secretary. Revenue Secretary, Chairman, CBEC and Chief Secretaries of States of Maharashtra and Tamilnadu were the other members of the Selection Committee. The Authority has been set up for a two-year period, which would begin from the date Shri B.N. Sharma assumes charge as Chairman. The Authority is mandated to ensure that the benefits of input credit and the reduction in GST rates on specified goods or services are passed on to the consumers by way of a commensurate reduction in prices. With the Chairman and Technical Members now having been appointed, the Authority

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onal mechanism for effective implementation of the anti-profiteering measures enshrined in the GST rules consists of a Standing Committee, State level Screening Committees and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC). Consumers who are aggrieved that there has been no commensurate reduction in prices may apply for relief to the Screening Committee in the State. After forming a prima facie view on the substance of the application, the matter would be referred to a Standing Committee at the Centre. The Standing Committee shall, in turn, ask the Director General of Safeguards, CBEC to carry out detailed investigation. The Director General of Safeguards shall report its findings to the Authority.

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Goods and Services Tax – GST – By: – Srinivasan Krishnamachari – Dated:- 28-11-2017 Last Replied Date:- 5-12-2017 – This article is on the applicability of GST when both supplier and recipient of renting of immovable property service are located outside India but the property is situated in India The provisions for determining place of supply of services are given under sections 12 and 13 of the IGST Act. Section 12 determines the place of supply of services where the location of supplier of services and the location of the recipient of services is in India. Thus, Section 12 will apply only where the location of supplier as well as the recipient is in India. Similarly, section 13 determines the place of supply of services where the location of the supplier of services or the location of the recipient of services is outside India. Thus, this section prescribes the provisions for determining the place of supply in case where either the location of supplier or the location of recipient o

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ocation of supplier as well as the recipient is outside India, since Section 2(11) of the IGST Act defining Import of service requires Service provider to be outside India and recipient to be in India, in addition to place of supply of service having to be in India. In the given case, there are divergent views; One view is that sine the given case would appear to be outside the purview of GST as both the supplier and recipient are outside and hence both Section 12 and 13 may be rendered irrelevant. Even the charging Sections of CGST/IGST Acts namely Sections 12 and Section 5 respectively will lose their relevance once the transaction in question is held to be outside GST. This is possibly not correct since location of Immovable property is in India and hence the place supply is the location of the immovable property in India which is a taxable supply. In whose hands the said supply is taxable is perhaps the only reasonable question remaining to be resolved. Section 9 of CGST Act, 2017

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a supply of goods or services or both in the course of inter-State trade or commerce. The given case may fall under the residual clause (c) of section 7(5) and accordingly, the supply of service may be treated as inter-state supply and provisions of IGST Act, 2017 will apply, is the said above view. From the above discussion, one thing can be safely surmised that the intention of government is however clear to levy tax in a case where the place of supply is in India. In keeping with the above we have to reach inevitably the conclusion that Section 13 of the IGST Act has to be liberally interpreted to include the given case under it. By holding this view, the problem would be, the provider of renting of Immovable property service will be required to get himself registered in India. Now, paradoxically, since the supplier is liable to be registered in India, the location of supplier and place of supply may be construed to be in the same state. Accordingly, the present case stands the ris

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ssion clearly indicates that there is a lot of anomaly in the given situation and is sure to trigger a lot of litigation. Though it is a rare phenomenon, we still need to find a solution to the issue here and hence this article. Let us try to capture the scheme of Section 7 of the IGST Act defining Inter-state supply, so that the readers will have an over view of it to understand its construct in all its ramifications. Section 7(1) is devoted to inter-state trade and commerce of goods happening within the country, where the location of the supplier and recipient are in two different states to enable levy of IGST on inter-state supply of goods. Section 7(2) speaks about plain import of goods so as to facilitate levy of IGST on Imports to replace the old level playing levies of CVD and SAD. Section 7(3) deals with inter-state supply of Services subject to Section 12. Section 7(3) though confined to domestic inter-state supply of services, it still includes under its ambit supply of servi

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on 7(4) carefully bears no reference to Section 12 or Section 13 for a reason, that Government reserves the right to levy tax on import of services notwithstanding the fact that the location of both the supplier and the recipient are outside India, with reference to a transaction happening under the ambit of Section 7(4) involving an Immovable property located in India. But at the same time one must also note that Section 7(2) of IGST Act does not find support for deeming exports as an interstate supply unlike in the case of Imports deemed as interstate supply in terms of Explanation to Article 269A of the Constitution (One Hundred and First) Amendment Act, 2016. Government is empowered to make such Laws to regulate supply as it deems fit as per Article 269 A (5) of the Constitution, even as there is no specific definition for supply in the Constitution itself. Section 7(5) is meant to take care of i) Supply of goods and services for i) export ii) to or by a SEZ/SEZ Developer iii) in t

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of the IGST Act that relates to services supplied to an individual, represented either as the recipient of service or a person acting on behalf of the recipient, that requires the physical presence of the recipient or the person acting on his behalf, with the supplier for the supply of services . This only means as in the case OIDAR services provided under Section 14 of the IGST Act, even if the Provider of services is not located in India but located abroad, and the service recipient is located in India, the Supplier or the person acting on his behalf, has to register and pay tax involved on the said renting of the property located in India. If no one is there on the scene of the given transaction to represent in the capacity of the Supplier, then there has to be one designated by the actual supplier located abroad to discharge the liability on his behalf under the head IGST in this case as then it would be right to be construed as import of service and in turn deemed as an inter-sta

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o determine the nature of a given transaction whether it is intra-state or inter-state and it particularly depends a great deal according to me on the relative location of the supplier with reference to the place of actual supply. Therefore, the conclusion is that Section 7 of the IGST Act is not a stand-alone provision to determine the intra-state or inter-state nature of a supply. You need to determine in addition the location of the supplier to arrive at the correct type of tax to be paid i.e whether CGST/SGST or IGST under Section 9 or 5 of respectively the CGST/IGST Acts based on the relative locations of the supplier and recipient with reference to Section 7 ibid The above situation also fits into the definition of Import of services under Section 2(11) of IGST Act, 2017 since the said service provider is located outside India, service recipient(to be designated for this purpose) is located in India and place of supply is in India. The only shortcoming from which it might be said

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ia and in India to qualify as Import in the above case is however squarely met in terms of the said Section 2(11) of the IGST Act. Thus charging of IGST and registration by a designated person on behalf of the owner of Immovable property located abroad and remitting the tax himself through his designated representative appear to be a good and compliant solution in this case. When both supplier and recipient of renting of immovable property service are located outside India and property is situated in India, in the absence of a special procedure as provided under Section14 of the IGST Act as in the case of OIDAR service, there appears to be no other alternative available under the present Law. The Government will be well within its jurisdiction in my view to use the unfettered powers of Section 7(4) of the IGST Act in the above case and treat it as an import of Service and hence an inter-state supply and levy IGST unlike Section 7(3) of the IIGST Act which hinges on Section 12 to determ

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have discussed the deeming fiction, for the sake of ease relevant para is reproduced: The only way to enable the levy in this case is through creating a deeming fiction under the IGST Act, with reference to the person responsible for payment of tax as it needs to be deemed as an Import to be able to levy and collect IGST. But In the landmark decision of Govind Saran Ganga Saran v. Commissioner of Sales Tax 1985 (4) TMI 65 – SUPREME COURT, the Hon ble Supreme Court held that one of the canons of taxation is that there must be a clear indication of the person on whom the levy is imposed and who is obliged to pay the tax. If this component is not fulfilled, the Apex Court stated that it is difficult to say that the levy exists in point of law . Therefore, in view of the Hon ble Supreme Court ruling, it may not possible to create deeming fiction for levy of GST where supplier, as well as the recipient, is located outside INDIA. Your views please. – Reply By Srinivasan Krishnamachari – The

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Goods and Services Tax – Started By: – Gurleen Rajpal – Dated:- 28-11-2017 Last Replied Date:- 30-11-2017 – Hello everyone, I am new to this forum, I would like to get some clarity on The GST regime.We are Rent a cab services, can we bill under the 5% composite plan and the 12% for input tax credits, all our vendor and clients are expecting different GST ones and we have purchased new vehicles and plan to purchase one more soon so we are not aware how to bill! Also are we expecting one tax slab even in this industry! Please help! – Reply By Ramaswamy S – The Reply = Suggest not to opt for composite scheme. Please pay the regular tax and take the credit of the tax paid on the vehicles purchased.RegardsS.Ramaswamy – Reply By ANITA BHADRA – T

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pt for 12% GST. Reason being is that Input Tax Credit is not available to Industry as is specified in negative List except where the use of Cab is statutorily required under the Act. Both the Options are available and ITC is available to you on proportionate basis on the basis of Turnover. You have to take Business Call considering Cost benefit analysis / Market share. – Reply By Ganeshan Kalyani – The Reply = I agree with the views of the experts. – Reply By Ganeshan Kalyani – The Reply = Sir if you opt for 12% then input tax credit on all inputs purchased in course or furtherance of business is eligible except few ineligible credits. And if you opt to pay tax @ 5% then input tax credit is not eligible because the tax you are paying in low

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Goods and Services Tax – Started By: – Archna Gupta – Dated:- 28-11-2017 Last Replied Date:- 1-12-2017 – Dear Expert,If we raise invoice to our foreign client for providing services and we raise invoice for Export of services on payment of IGST . Suppose the invoice is raised for 100 USD and charged IGST @ 18% i.e., total invoice amount comes to 118 USD.1. Whether the invoice for 100 USD or 118 USD will be sent to the client?2. whether we'll receive 118 USD or 100 USD from our client? What I understand in this case that we'll receive 100 USD from client and deposit IGST of 18 USD from our own pocket and later on will apply for refund of 18 USD. – Reply By CS SANJAY MALHOTRA – The Reply = 1. GST Invoice is for 118 $ (100 + IGST), wh

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aswamy – Reply By Archna Gupta – The Reply = Thanks to all for your concern. In my case these queries are related to my earlier invoices issued because that time we had not filed LUT. Sanjay ji my further query is that my total invoice value is 118 USD as is given in the example which I sent to my client in USA and he makes the full payment of 118 USD. What will I do in that case? Will I have to deposit more IGST by grossing up the amount received or should refund the money extra received? Or we should send the invoice of 100 USD only? Will that be correct? For what amount I will file the refund claim? – Reply By CS SANJAY MALHOTRA – The Reply = Archna ji,Please note the below options available:1. If the situation remains AS IS i.e. Invoice

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Customs – Started By: – K.Shashi Nair – Dated:- 28-11-2017 Last Replied Date:- 28-11-2017 – Hello.. 8506 includes Primary and Secondary Cells. The Lithium Ion batteries /cells (including Mobile Phone Batteries) falls under this tariff. Under the amended notification, the IGST for 8506 has been revised from 28% to 18% The imports that I do, are Parts of Lithium Ion Battery. This is being imported under 85079090. The IGST however for this is still at 28%. Under the Make in India concept, will the

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Goods and Services Tax – GST – Dated:- 28-11-2017 – A sum of ₹ 83,346 crores has been collected as Total Revenue Collection under GST for the month of October, received in November till 27th November 2017. 95.9lakh taxpayers have been registered under GST so far, of which 15.1 lakh are composition dealers who are required to file returns every quarter. 50.1 lakh returns have been filed for the month of October till 26th November 2017. Revenue of States: The States have collected a total of ₹ 87,238 crores by way of SGST in the months of August, September, October and November 2017 (till 27th November). Further on all inter-state trade, a net amount is transferred from IGST account to the SGST account whenever IGST collected is

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d providing for a projected revenue growth rate of 14%. Centre s Revenue: The total CGST income in the months of August, September, October and November (till 27th November) has been ₹ 58,556 crores. In addition to this, an amount of ₹ 16,233 crores has been transferred from IGST account to CGST account by way of settlement of funds on account of inter-state supply of goods and services in the month of August, September and October, 2017. Further, ₹ 10,145 crores is being transferred to CGST account from IGST account for the month of November 2017 by way of settlement. The major reason for the gap in income of CGST and SGST has been that more CGST liability has been discharged using transition credit rather than by way of

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Goods and Services Tax – Started By: – K.Srinivasan Kuppuswamy – Dated:- 28-11-2017 Last Replied Date:- 4-12-2017 – Sir,We have the following query in respect of charging GST on sales return / purchase return/ price reduction/price increase 1.Sales returns through Delivery adviceSome of the customers sending the customer returns in delivery challan without GST 2. Sales returns through Tax Invoice Some of the customers sending the customer returns in tax invoice with GST for which we need to 3. Price decrease/reduction The price decrease / reduction credit note to be issued without GST. Since already we have charged GST on the higher price and customer availed the ITC credit we need to issue the credit for the material value.However some of

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ar Sir First at all , any debit credit note is to be issued by the supplier only . Recipient will not issued any invoice , with or without GST . Issue of invoice by registered recipient were to be applicable in case sale made prior to GST implemented date ( Sec 142 ) .and return post GST implementation Further , Debit /Credit Note will have details of original tax invoice and also indicate taxable value ( of goods return ) and GST component on it . Your GSTR 1 will also indicated details of Debit/Credit Notes issued . This will matched with GSTR 2 of the recipients . You need not to issue any invoice for purchase return . Your supplier will issue credit note in case of purchase return by you Regards – Reply By Ramaswamy S – The Reply = Dear

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i – The Reply = The responsibility of issuing credit note or debit note is cast on the supplier of goods or services. – Reply By Mathurthi RamKumar – The Reply = Dear Sir,With reference to the above Q&A, Kindly clarify me that normal debit note and credit notes will applicable for before gst or not? Also kindly advise for below transaction.Agent give his commission invoice with gst. This commission will adjust for other parties balance payments.for above – Before GST i issue cr note to agent. I think as per GST rules now this transaction not under GST credit note. Am i correct? Becoz GST cr note will issue when supply / purchase will attract GST only. Kindly advise me. How to accounting for agent commission invoices.Thanks in advance.Re

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GST – States – S.O.090/P.A.5/2017/S.148/2017 – Dated:- 28-11-2017 – GOVERNMENT OF PUNJAB DEPARTMENT OF EXCISE AND TAXATION (EXCISE AND TAXATION-II BRANCH) NOTIFICATION The 28th November, 2017 No. S.O.090/P.A.5/2017/S.148/2017.-In exercise of the powers conferred by section 148 of the Punjab Goods and Services Tax Act, 2017 (Punjab Act No.5 of 2017), and all other powers enabling him in this behalf, the Governor of Punjab, on the recommendations of the Council, is pleased to notify the registered persons having aggregate turnover of upto 1.5 crore rupees in the preceding financial year or the current financial year, as the class of registered persons who shall follow the special procedure as detailed below for furnishing the details of outw

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