1. GST DEADLINES
1.1 Deadlines | February 24
● GST Compliance Calendar – February 2024
2. Union Budget 2024 Proposed Amendments (Finance Bill 2024)
No significant tax announcements were proposed, with only a few necessary proposals introduced concerning GST. The major changes proposed in the Finance Bill 2024 have been discussed below:
INPUT SERVICE DISTRIBUTOR
The Finance Bill 2024 has proposed to amend the definition of ISD and manner of distribution of common credit using ISD mechanism. As per the proposed definition, the condition of issuing the prescribed documents has been removed. Hence, where an office receives input services on behalf of deemed distinct persons, it would be considered as ‘ISD’, and thus it would become liable to comply with the relevant provisions for distribution of common credit.
The impact of the proposed amendment is as under:
a) The person who receives common ITC for the deemed distinct persons would be required to obtain mandatory registration as ISD
b) For the distribution of ITC of the services liable to RCM, tax is required to be spaid by the normal registration in the State of ISD
The said proposed amendment, when made effective, would mandate the distribution of common ITC on services through ISD mechanism only. This would also require parallel amendment in rules to provide for the mechanism of distribution of ITC.
PENALTIES ON TOBACCO MANUFACTURES
The Finance Bill, 2024 has proposed the introduction of new Section 122A within the Penalties Chapter, specifying penalty for any person engaged in the manufacture of specified goods who fail to register the machines in accordance with the special procedure. The proposed provisions prescribe a penalty of Rs. 1 lakh for every machine not registered as per the special procedure. Notably, the said penalty is in addition to any penalty paid or payable under Demand and Recovery provisions or any other sections of the Penalties Chapters.
3. Notifications
3.1.Extension of Time Limit for issuance of Order for recovery of Tax not paid or short paid or of Input Tax Credit wrongly availed or utilized, relating to specific Periods
(Notification No. 56/2023; Dated:- 28 December, 2023)
The Government, on the recommendations of the Council, hereby, extends the time limit specified under sub-section (10) of section 73 for issuance of order under sub-section (9) of section 73 of the said Act, for recovery of tax not paid or short paid or of input tax credit wrongly availed or utilized, relating to the period as specified below:
Financial Year | Last date to issue SCN | Last Date to issue Order |
2018-19 | 31st January, 2024 | 30th April, 2024 |
2019-20 | 31st May, 2024 | 31st August, 2024 |
4. GST PORTAL UPDATES
4.1. Advisory on the functionalities available on the portal for the GTA taxpayers
(Advisory dated: - 01 Jan 2024)
1. As per the Notification No. 06/2023-Central Tax (Rate), dated 26.07.2023, the option by GTA to pay GST on Forward Charge mechanism or the Reverse Charge mechanism respectively on the services supplied by them during a Financial Year shall be exercised by making a declaration in Annexure V or Annexure VI from the 1st January till 31st March of the current Financial Year, for the next Financial Year.
2. To comply with the above notification, online filing in Annexure V Form and Annexure VI Form is available on the portal for the existing GTA taxpayers for filing declaration in Annexure V Form or Annexure VI
4.2. Advisory on introduction of new Tables 14 & 15 in GSTR 1
(Advisory dated: - 15 Jan 2024)
As per Notification No. 26/2022 – Central Tax dated 26th December 2022 two new tables Table 14 and Table 15 were added in GSTR-1 to capture the details of the supplies made through e-commerce operators (ECO) on which e-commerce operators are liable to collect tax under section 52 of the Act or liable to pay tax u/s 9(5). These tables have now been made live on the GST common portal. These two new tables will be available in GSTR-1/IFF from January-2024 tax periods onwards.
4.3. Advisory on Payment through Credit Card (CC)/Debit Card (DC) and Unified Payments Interface (UPI)
(Advisory dated: - 19 Jan 2024)
To facilitate the taxpayer registered under GST with more methods of payment, two new facilities of payment have now been provided under e-payment in addition to net-banking. The two new methods are Cards and Unified Payments Interface (UPI). Cards facility includes Credit Card (CC) and Debit Card (DC) namely Mastercard, Visa, RuPay, Diners (CC only) issued by any Indian bank. This pioneering initiative operates seamlessly through all UPIs facilitated by Kotak Mahindra Bank
The feature is currently accessible in ten specific States and Union Territories, namely Assam, Delhi, Goa, Gujarat, Haryana, Himachal Pradesh, Kerala, Madhya Pradesh, Maharashtra, and Odisha. The selective rollout targets a diverse geographical spectrum to test and implement the new UPI-enabled GST payment system.
4.4. Advisory for furnishing bank account details by registered taxpayers under Rule 10A of the Central Goods and Services Tax Rules, 2017
(Advisory dated: - 19 Jan 2024)
1. All Registered Taxpayers are required under the provisions of CGST Act, 2017 and the corresponding rules framed thereunder to furnish details of their bank account/s within 30 days of the grant of registration or before the due date of filing GSTR-1/IFF, whichever is earlier.
2. Taxpayers are therefore advised to promptly furnish their bank account details, who have not provided it so far if 30 Days period is shortly going to expire to avoid disruption in business activities and the subsequent suspension of GSTIN.A new functionality is being developed with the following features and will be deployed in near future.
3. If the taxpayer fails to furnish the bank account within the stipulated time it would result into following:
a. Taxpayer Registration would get suspended after 30 days and intimation in FORM REG-31 will be issued to the Taxpayer.
b. Get the Taxpayer debarred from filing any further GSTR-1/IFF.
4. If the taxpayer updates their bank account details in response to the intimation in FORM REG-31, the suspension will be automatically revoked. If the bank account details are not updated even after 30 days of issuance of FORM REG-31, the registration after suspension may also be taken up for cancellation process by the Officer.
4.5.GSTN redesigns Notices and Orders Tab
(Advisory dated:- 17 Jan 2024)
In a recent update, the Goods and Services Tax Network (GSTN) has introduced a revamped design for the Notices and Orders Tab on the GST Portal, streamlining access to critical information for taxpayers. With categorized sections for different types of notices and orders, users can efficiently locate and respond to critical communications from tax authorities.
5. JUDICIAL PRONOUNCEMENTS
5.1.Accounting ITC as IGST instead of CGST and SGST: Kerala High Court directs GST Dept to Consider GSTR-3B Rectification Application
(Divya S.R. Vs. Union of India)
Assessee while preferring monthly return in GSTR 3B for July, 2017, by mistake claimed entire input tax credit under heads of CGST and SGST, instead of claiming it under head IGST -Consequently, assessment order was passed - On rectification application, no decision was taken - Writ was filed by assesse seeking a writ of mandamus to respondent authority to set off input tax credit of IGST, which was wrongly claimed under CGST and SGST for period.
It was held that Writ petition was to be disposed of with direction to respondent authority to consider application filed by assesse and pass necessary orders thereon expeditiously.
5.2.Uploading Notice on Portal is not Sufficient Notice on Cancellation of GST Registration, should be Served on Assessee’s Address
(Eastern Machine Bricks & Tiles Industries Vs. State of U.P)
Assessee had already cancelled its registration voluntarily in 2019 but department issued show cause notice to assessee under section 74 of CGST Act, 2017 - Said notice was simply uploaded on web portal in-spite of knowing that assessee had already cancelled its registration prior to issuance of said notice - Uploading of notice on web portal, which was required to be sent on address of assessee, prevented assessee from appearing in hearing in original proceedings and ex-parte impugned order was passed.
It was held that Impugned order was to be quashed and set aside with a direction to respondent authority to grant an opportunity of hearing to assessee, and after hearing parties reasoned order was to be passed.
5.3.Non-filling up of Part 'B' of e-Way Bill
(Rawal Wasia Yarn Dying (P.) Ltd. Vs. Commissioner Commercial Tax )
Where assessee did not fill up Part 'B' of e-Way Bill, since invoice itself contained details of truck and error committed by assessee was of a technical nature only and without any intention to evade tax, order of penalty passed against assessee under section 129(3) was to be set aside.
5.4.Where SCN issued to assessee for cancelling of GST registration failed to mention which specific provisions had not been complied
(Shreya International Vs. Principal Commissioner.)
Show cause notice was issued to assessee for cancelling GST registration for reason "non-compliance of any specified provisions in GST Act or Rules made thereunder as may be prescribed" Thereafter order of cancellation of registration retrospectively was passed citing reason "Response not received".
It was held that Said SCN failed to mention which specific provisions had not been complied with and there was not material on record to show as to why registration was sought to cancelled retrospectively - Therefore, both SCN and impugned order were bereft of any reasoning and particulars and were to be set aside and registration was to be restored.
5.5.Where assessee had inadvertently not disclosed certain sales invoices in Form GSTR-1
(Anvita Associates Vs. Union of India)
Where assessee had inadvertently not disclosed certain sales invoices in Form GSTR-1 and hence said invoices were not reflected in Form GSTR-2A of its customer; assessee was to be directed to file an application for rectification of Form GSTR-1 for period in question before concerned GST Authorities, who were to decide same in accordance with law.
5.6. Order for reversal of ITC due to cancellation of registration of one of the supplier
(TVL. Cleon Optobiz (P.) Ltd. Vs. Assistant Commissioner)
Petitioner assessee received both an intimation and show cause notice from department regarding blocking of credit - Eventually, order was issued by which ITC availed by petitioner in respect of purchases made from 'P' was reversed on ground that said entity was non-existent and was not conducting business - Assessee contended that it could not be penalised because GST registration of 'P' was cancelled subsequently with retrospective effect.
It was held that Invoices, e-way bills and proof of payment of invoices in form of relevant bank statements were produced by assessee before department. However, impugned order recorded finding that assessee had not produced documents as required under section 16 .Said conclusion was not sustainable - Impugned order also called for interference because assessee was not put on notice that goods dealt with by it were different from those dealt with by its supplier, but a finding was recorded on said issue in impugned order. Impugned order was to be quashed for not duly considering documentary evidence placed on record by assessee to establish that purchases were genuine and matter was to be remanded.
5.7. Non-consideration of assessee's reply to show cause notice
(MakeMyTrip (India) (P.) Ltd. Vs. State Tax Officer)
Petitioner-assessee's had challenged that revenue did not take into consideration of assessee's reply to show cause notice in form DRC-01
It was held that Non-consideration of reply to show cause notice certainly prejudices assessee and denies assessee a reasonable opportunity to establish its position.
Therefore, without expressing any opinion on merits of matter, orders were to be quashed and matter was remanded for reconsideration by assessing officer after providing a reasonable opportunity to the petitioner.
Disclaimer: “This material is intended to provide general information on particular subject(s) and is not an exhaustive treatment of such subject(s) or a substitute to obtaining professional service or advice. It is strongly recommended to seek professional advice before implementation of any of the aspects covered in the presentation.”)
Author can be reached at ca.hsinghal@gmail.com; +91 99172 11511
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