FORMS PRESCRIBED UNDER DRAFT RULES OF MODEL GST LAW

Goods and Services Tax – GST – By: – Mr. M. GOVINDARAJAN – Dated:- 18-10-2016 Last Replied Date:- 19-10-2016 – The Board framed various draft rules for the comments of the stakeholders. The draft forms for the respective rules are also prescribed. It is learnt that the GST Council has approved the draft rules framed. The forms prescribed under various rules are discussed in this article for the benefit of the readers. Registration rules The following forms are prescribed under Draft Goods and Service Tax Registration Rules for the purposes of various sections of Model GST Act ( Act for short)- GST REG – 01 : Application for Registration under Section 19(1) of the Act; GST REG- 02 : Acknowledgement; GST REG – 03 : Notice for seeking additional information/clarification/documents relating to application for registration/amendment/cancellation; GST REG – 04 : Application for filing clarification/additional information/document for registration/amendment/cancellation/revocation of cancell

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e notice for cancellation of registration; GST REG – 16 : Order for cancellation of registration; GST REG – 17 : Application for revocation of cancelled registration under the Act; GST REG – 18 : Order for approval of application for revocation of cancelled registration; GST REG – 19 : Notice for seeking clarification/documents relating to application for revocation or cancellation; GST REG – 20 : Application for enrolment of existing taxpayer; GST REG – 21 : Provisional Registration Certificate to existing tax payer; GST REG – 22 : Order of cancellation of provisional certificate; GST REG – 23 : Intimation of discrepancies for Application for enrolment of existing tax payer; GST REG – 24 : Application for cancellation of Registration for the migrated tax payers not liable for registration under the Act; GST REG – 25 : Application for extension of Registration period by casual/non resident taxable person; GST REG – 26 : Form for field visit report. Invoice Rules The following forms are

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ected or deleted by the recipient; GSTR – 2 : Details of inward supplies of taxable goods and/or services claiming input tax credit; GSTR – 3 : Monthly return on the basis of finalization of details of outward supplies and inward supplies along with the payment of tax; GSTR – 3A : Notice to a registered taxable person who fails to furnish return under section 27 and section 31; GSTR – 4 : Quarterly Return for compounding Taxable persons; GSTR – 4A : Details of inward supplies made available to the recipient registered under composition scheme on the basis of FORM GSTR-1 furnished by the supplier; GSTR – 5 : Return for Non-Resident foreign taxable person; GSTR – 6 : ISD return; GSTR – 6A : Details of inward supplies made available to the ISD recipient on the basis of FORM GSTR-1 furnished by the supplier; GSTR – 7 : Return for authorities deducting tax at source; GSTR – 7A : TDS certificate; GSTR – ITC 1:Communication of acceptance, discrepancy or duplication of input tax credit claim;

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Determination of value for transactions between the Related parties under GST Laws.

Goods and Services Tax – GST – By: – Anuj Bansal – Dated:- 17-10-2016 – Determination of value for transactions between the Related parties under GST Laws. This article is in continuity of Author s earlier articles in regard to transition of registration and input tax credit from present regime to GST regime. In the earlier articles, legal provisions in regard to transition of registration and closing balance of input tax credit from present regime to GST regime were discussed in detail and it was explained that registration as well as input tax credit will automatically be transferred to GST regime subject to certain conditions. As a matter of principle, tax will be leviable under GST law at each stage of transaction at the prescribed rate. Tax will be leviable on the value of the transaction entered into between the parties. Section 15 of Model GST Law provides that for the purpose of levy of tax value of the transaction shall be accepted if the supplier and the recipient are not re

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(g) Together they directly or indirectly control a third person; or (h) They are members of the same family; As per the above provision, the definition of related persons is very wide and extends to even the employer & employees, family members, etc. In the aforesaid background and the provisions of Model GST Law, it is important to examine the provisions which will govern determination of transaction value in case the transactions are between the related parties. In this regard, Rule 3(4) of GST Valuation Rules provides that transaction value shall be accepted where the supplier and recipient are related parties, provided that the relationship has not influenced the price of the goods and service. Accordingly, in the circumstances where the relationship of the parties has not influenced the value, transaction value shall be accepted by the Officer. However, as per Rule 7, if the officer has any reason to doubt the truth and accuracy of the transaction, he may ask the supplier to f

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of transaction undertaken by such supplier with other customers of the goods / services of like kind and quality. However, in determining the value on the basis of comparison, certain adjustments are prescribed in Rule 4(2) which the officer shall consider while determining the transaction value. The adjustments prescribed includes difference in dates of supply, difference in commercial level and quantity level, difference in composition / quality and design between goods and services and difference in freight and insurance charges depending on place of supply. However, if the valuation is not determinable under Rule 4 then the officer will proceed to Rule 5 in determining the value which is called a computed value method. Computed value method – Vide Rule 5 of the GST valuation rules, it is stated that in order to determine the transaction value various types of costs are added for providing goods / services. The cost towards design & brand of the goods are also added and the amo

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tigation. In these circumstances, it is stated that these discretionary powers will lead to litigation. It is also important in this regard to examine whether such powers were necessary to be provided under the law. As per GST law, tax will be leviable at the prescribed percentage at each of the stage of transaction. Accordingly, in case intervening transactions i.e. prior to the last transaction with the consumer, are between the related parties and assuming same are at value less than the reasonable value, the tax if charged at a lower value at the initial stage, same will be charged at the higher value at the second stage when the buyer will further sell the goods or will use for the manufacturing process or for providing any services, etc. In totality, there will be no tax impact on under valuation at initial stages of the transactions. There can be impact only if the final consumer is the related party and at that stage the transaction is on under valuation. Accordingly, instead o

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e Government has ignored that such provisions are not much relevant in GST law for the reason that under Excise & Customs laws, Cenvat of the duty paid at the manufacturing stage or at the stage of import into India, is not available to the dealer when the dealer is entering into next stage of transaction i.e. a manufacture entering in to trade stage or an importer entering into stage of manufacturing / trading. Therefore, if at any stage either at the time of import of goods or at the time of manufacturing goods, the price is influenced / undervalued due to relationship between the parties, there would a revenue loss. However, under GST law, since there is smooth flow of credit, there would not be any revenue loss even if any intervening transaction in the chain is undervalued unless it is a last sale i.e. the sale for consumption. In the light of above discussion, it seems very unreasonable on the part of the Government to check each transaction undertaken by the related parties.

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REFUND UNER MODEL ‘GST’ LAW

Goods and Services Tax – GST – By: – Mr. M. GOVINDARAJAN – Dated:- 17-10-2016 Last Replied Date:- 30-12-1899 – Refund The term refund is defined under Explanation (A) to Section 38 as including refund of tax on goods and/or services exported out of India, or refund of tax on the supply of goods regarded as deemed exports, or refund of unutilized input tax credit. Type of refunds The refund that may be got from the Board is the refund of any tax and interest and refund of unutilized input tax credit. Refund of unutilized input tax credit A taxable person may claim refund of any unutilized input tax credit at the end of any tax period. No refund of unutilized input tax credit shall be allowed in cases other than exports or in cases where the credit has accumulated of rate of tax on inputs being higher than the rate of tax on inputs. No refund of unutilized input tax credit shall be allowed in cases where the goods exported out of India are subject to export duty. Time limit The time lim

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in the case of goods returned for being remade, refined, reconditioned or subjected to any other similar process in any place of business, the date of entry into the place of business for the purposes aforesaid; in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of- receipt of payment in convertible foreign exchange, where the supply of service had been completed prior to the receipt of such payment; or issue of invoice, where payment for the service had been received in advance prior to the date of issue of the invoice; in case where the tax becomes refundable as a consequence of judgment, decree, order or direction of Appellate authority, Appellate Tribunal or any Court, the date of communication of such judgment, decree, order or direction; in the case of refund of unutilized input tax credit, the end of the financial year in whic

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ports, by the unit or the developer or the recipient of deemed export supplies; The application shall be accompanied by any one of the following documentary evidences, as applicable, to establish that a refund is due to the applicant- the reference number of the order and a copy of the order passed by the proper officer or an appellate authority or any competent court resulting in such refund including refund of pre-deposit along with the reference number of the payment of the amount claimed as refund; a statement containing the number and date of shipping bills or bills of export and the number and the date of relevant export invoices, in a case where the refund is on account of export of goods; a statement containing the number and date of invoices as prescribed invoice rules in case of supply of goods made to an SEZ unit or a developer; a statement containing the number and date of invoices, in a case where the refund is on account as deemed exports; a statement containing the numbe

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med as refund has not been passed on to any other person, in a case where the amount of refund claim is less than ₹ 5 lakhs; a certificate in Annexure 2 of Form No. GST RFD-1 issued by a Chartered Accountant or a Cost Accountant to the effect that the incidence of tax and interest claimed as refund has not been passed on to any other person, in a case where the amount of refund claimed is ₹ 5 lakhs or more; If the refund claim relates to input tax credit, the electronic credit ledger shall be debited by the applicant in an amount to the amount to the refund so claimed; Where any taxable goods or services are exported without payment of tax, under bond or letter of undertaking refund of input tax credit shall be granted as per the following formula- Refund amount= (Export turnover of goods + Export turnover of services) x net ITC Adjusted total turnover The application for refund of any amount, after adjusting the tax payable out of the advance tax deposited by the applicant

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rough the common portal electronically requiring him to file a refund application after rectification of such deficiencies; If the proper officer is satisfied that the whole or part of the amount claimed is refundable, he may make an order in Form No. GST RFD – 5, sanctioning the amount of refund to which the applicant is entitled, mentioning the amount, if any, refunded to him on a provisional basis, amount adjusted against any outstanding demand and balance amount refundable; Such order shall be issued within 90 days from the date of receipt of application; Where the amount of refund is completely adjusted against any outstanding demand an order giving the details of adjustment may be issued in Form GST RFD – 6; If the amount of refund is not admissible or payable the proper officer shall issue a notice in Form No. GST RFD – 7 to the applicant, requiring him to furnish a reply within 15 days of the receipt of such notice; After considering the reply filed by the applicant, if any, th

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he claim and on being prima facie satisfied that the amount claim as refund, shall make an order in Form GST RFD – 4 sanctioning the amount of refund due to the said applicant on provisional basis within a period not exceeding 7 days from the date of acknowledgment; The proper officer shall issue a payment advice in Form No. GST RFD – 8 for the amount sanctioned to be electronically credited to any of the bank accounts of the applicant mentioned in his registration particulars and as specified in the application for refund; The refundable amount shall be paid to the applicant, instead of being credited to the Fund, if such amount relates to- refund of tax on goods and/or services exported out of India or on inputs used in the goods and/or services which are exported out of India; refund of unutilized input tax credit; the tax and interest, if any, or any other amount paid by the applicant, if he had not passed on the incidence of such tax and interest to any other person; or the tax or

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refund tills such time as he may determine; Where a refund is withheld the taxable person shall be entitled to interest if as a result of the appeal or further proceeding he becomes entitles to refund; Where any interest is due and payable the proper officer shall make an order and a payment advice in Form GST RFD – 9, specifying the amount of refund which is delayed, the period of delay for which interest is payable and the amount of interest payable; The interest shall be electronically credited to any of the bank accounts of the applicant mentioned in his registration particulars and as specified in the application for refund; No refund shall be paid to an applicant if an amount is less than ₹ 1000/-; Any person eligible to claim refund on his inward supplies shall apply for refund in form No. GST RFD – 10 once in every quarter, electronically on the Common Portal along with a statement of inward supplies of goods and/or services in Form No. GSTR – 11 prepared on the basis of

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Payment Advice

Payment Advice – GST RFD-08 – Draft-Bills-Reports – Draft GST Refund Formats – DRAFT – GOODS AND SERVICES TAX – REFUND RULES, 20- [September 2016] – GST RFD-08 – Payment Advice – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Refund Sanction/Rejection Order

Refund Sanction/Rejection Order – GST RFD-05 – Draft-Bills-Reports – Draft GST Refund Formats – DRAFT – GOODS AND SERVICES TAX – REFUND RULES, 20- [September 2016] – GST RFD-05 – Refund Sanction/Rejec

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Provisional Refund Sanction Order

Provisional Refund Sanction Order – GST RFD-04 – Draft-Bills-Reports – Draft GST Refund Formats – DRAFT – GOODS AND SERVICES TAX – REFUND RULES, 20- [September 2016] – GST RFD-04 – Provisional Refund

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Acknowledgement

Acknowledgement – GST RFD-02 – Draft-Bills-Reports – Draft GST Refund Formats – DRAFT – GOODS AND SERVICES TAX – REFUND RULES, 20- [September 2016] – GST RFD-02 – Acknowledgement – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Electronic Cash Ledger

Electronic Cash Ledger – Form GST PMT-3 – Draft-Bills-Reports – Draft GST Payment Formats – DRAFT – GOODS AND SERVICES TAX – PAYMENT RULES, 20- [September 2016] – Form GST PMT-3 – Electronic Cash Ledg

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Electronic Credit Ledger

Electronic Credit Ledger – Form GST PMT-2 – Draft-Bills-Reports – Draft GST Payment Formats – DRAFT – GOODS AND SERVICES TAX – PAYMENT RULES, 20- [September 2016] – Form GST PMT-2 – Electronic Credit

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Electronic Tax Liability Register of Taxpayer (Part–I: Return related liabilities Electronic Tax Liability Register of Taxpayer (Part–II: Other than return related liabilities)

Form GST PMT-1 – Draft-Bills-Reports – Draft GST Payment Formats – DRAFT – GOODS AND SERVICES TAX – PAYMENT RULES, 20- [September 2016] – Form GST PMT-1 – Electronic Tax Liability Register of Taxpaye

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Form for Field Visit Report

Form for Field Visit Report – GST REG-26 – Draft-Bills-Reports – Draft GST Registration Formats – DRAFT – GOODS AND SERVICES TAX – REGISTRATION RULES, 20- [September 2016] – GST REG-26 – Form for Fiel

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