Articles

GST Tribunals (GSTAT) Soon: 3 Reasons why taxpayers should prepare from now 
 
Now that the new Government has been formed, the policy landscape would again get moving. The long pending GST Tribunals would finally see light of day soon. With around 15000 cases pending to be filed before the GSTAT, the following are the reasons why taxpayers should start preparing for the GSTAT from now…

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20 Point GST & Income Tax: DO’s & DON’Ts checklist for FY 23–24 year-end for Trade & Industry
 
In March and April, along with the closure of books of accounts for tax departments and finance departments, it is also important to do multi-ference tax compliances as per GST and income tax norms.
In this article, we will go through a 20-point checklist for GST and income tax compliance which are required to be done in March and April so that the tax compliances can be adequately taken care of.
1. Stock Taking & ITC Reversals – for Stock lost/ stolen/ Destroyed/ Written Off – But Not stock ‘damaged’/ provision for non-moving items. In such stock taking, there are various items which are found destroyed, stolen, and which are written off or found lost. In such case, ensure that corresponding GST/ITC reversal is done. However, for merely slow-moving and non-moving items which are not destroyed but damaged or not even damaged. There is no required for GST/ITC reversal even in case a provision is made in the books of accounts.

Download the full Article below:20 Point GST & Income Tax DO’s & DON’Ts checklist for FY 23–24 year end for Trade & Industry

Making SME Payments by 31st March 2024 for compliance u/s 43B(h) of Income Tax Act
 
In March 2024, it is important to comply with Section 43B(h) of Income Tax Act for payment to MSEs (Micro and small-scale Enterprises). In this article we pen down the statutory requirements and analysis of this new amendment in detail.
1. Legal Provision – Certain deductions to be only on actual payment –
Section 43B(h) of Income Tax Act provides as follows –
Notwithstanding anything contained in any other provision of this Act, a deduction otherwise allowable under this Act in respect of – 43[(h) any sum payable by the assessee to a micro or small enterprise beyond the time-limit specified in section 15 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006.),] shall be allowed (irrespective of the previous year in which the liability to pay such sum was incurred by the
assessee according to the method of accounting regularly employed by him) only in computing the income referred to in section 28 of that previous year in
which such sum is actually paid by him : 14[Provided that nothing contained in this section 44[[except the provisions of clause (h)]] shall apply in relation to any sum 15[***] which is actually paid by the assessee on or before the due date applicable in his case for furnishing the return of income under sub-section (1) of section 139 in respect of the previous year in which the liability to pay such sum was incurred as aforesaid and the evidence of such payment is furnished by the assessee along with such return.
26[Explanation 4.-For the purposes of this section,- 36[
45[(e) “micro enterprise” shall have the meaning assigned to it in clause (h) of section 2 of the Micro, Small and Medium Enterprises Development Act, 2006
(27 of 2006.);] …
46[(g) “small enterprise” shall have the meaning assigned to it in clause (m) of section 2 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006).]]

Download the full Article below:Making SME Payments by 31st March 2024

Valid ITC cannot be denied merely due Reflection in GSTR-3B…Availment of valid ITC in books, GSTR-9 and GSTR-2B is sufficient
 
ITC is the biggest area of dispute in GST. Already many taxpayers are dwindling
with issues in claiming ITC itself such as the following –
1. Time barring period of ITC due to claiming ITC in GSTR-3B late – Claim of
ITC in GSTR-3B after the time barring period. Say The ITC of FY 21-22 is availed in the GSTR-3B of Nov’2022 filed in Dec’22 instead of the GSTR-3B filed in Nov’22 for Oct’22.
2. Time barring period of ITC due to filing GSTR-3B late – Delayed filing of
GSTR-3B as per erstwhile time barring period u/s 16(4) of CGST Act 2017. Say the GSTR-3B of Sep’2021 is filed on 25th Oct’21 instead of 20th Oct’21, which is the time barring date for taking ITC for FY 2020-21

Download the full Article below:Valid ITC cannot be denied merely due Reflection in GSTR-3B…Availment of valid ITC in books, GSTR-9 and GSTR-2B is sufficient

SCNs for FY 17-18 and 18-19 are still not time barred…All SCNs can be issued u/s 74
 
Ordinarily, SCNs may be challenged at High Courts on account of –
A. SCN issued without jurisdiction.
B. Even if one proceeds on the basis that statements in the SCN are correct, no case is made out for the threatened action.
C. There is a gross violation of natural justice or a right of the taxpayer.
The question is whether a case can be said to be made out by merely alleging “fraud/suppression/misrepresentation” without mentioning the reasons of the allegation. Is a nonspeaking order w.r.t. invocation of a larger period of limitation, not a violation of the right of the taxpayer.

Download the full Article below:SCNs for FY 17-18 and 18-19 are still not time barred…

Decoding Natural Justice in GST Cases
 
Section 75 of The CGST Act 2017 is a Code in Itself for invocation of Natural Justice in GST
Cases and states as follows –
“75 (4) An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.
75 (5) The proper officer shall, if sufficient cause is shown by the person chargeable with tax, grant time to the said person and adjourn the hearing for reasons to be recorded in writing:
Provided that no such adjournment shall be granted for more than three times to a person during the proceedings.
75 (6) The proper officer, in his order, shall set out the relevant facts and the basis of his decision.
75 (7) The amount of tax, interest and penalty demanded in the order shall not be in excess of the amount specified in the notice and no demand shall be confirmed on the grounds other than the grounds specified in the notice.”

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E-Waybill generated between detention and seizure of goods – No GST Penalty… Intent to Evade tax is sine qua non to invoke penalty
 
Recognising the distinction between technical errors and intentional evasion is essential for maintaining a balanced and equitable approach to tax enforcement. As nations continue their pursuit of effective tax administration, upholding this principle becomes paramount in fostering voluntary compliance, preserving trust in the tax system, and ensuring the judicious use of regulatory powers. In this backdrop, we are discussing E-Waybill detention cases which
are being handled by Industry as well as by consultants on a regular basis.

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No Interest under GST on delayed filing of GSTR-3B
 
Consider a case as follows –
GST Amount Payable For Jan 2024 period Rs.10,00,000/-
Electronic Credit Ledger Balance Rs.8,00,000/-
Electronic Cash Ledger Balance Rs.2,00,000/-
Due Date of return for Jan 2024 period 20th Feb 2024
Return for Jan 2024 period filed on 25th Feb 2024
Interest Liability NIL
While Section 50 of The CGST Act was retrospectively amended to provide that there would be
no interest liability on delayed filing of GSTR-3B to the extent of balance in The Electronic Credit
Ledger, the Courts in the following and other cases had held that interest was payable even
after there was balance in the Electronic Cash Ledger –
(i) Refex Industries vs. Assistant Commissioner of CGST reported in 2020 SCC Online Mad 587 – 2020-VIL-71-MAD;
(ii) Manasarover Motors P Ltd vs Assistant Commissioner reported in 2020 SCC Online Mad 28155 – 2020-VIL-524-MAD;
(iii) Srinivasa Stampings vs. SPT of GST & CE in W.P.No.7129 of 2021 – 2022-VIL-285-MAD
(iv) P.K. Ores P Ltd vs Commissioner of State Tax reported in MANU/OR/236/2022 – 2022-VIL-365-ORI;
(v) Orissa Stvedores Ltd vs. Union of India reported in MANU/OR/1116/2022;
(vi) RSB Transmission (India) Ltd. vs. Union of India reported in MANU/JH/1260 – 2022-VIL-745-JHR;
(vii) Haji Lal Mohd Biri Works vs. State of Uttar Pradesh reported in (1974) 3 SCC 137 – 1973-VIL-22-SC;
(viii) The Sales Tax Officer vs. Dwarika Prasad Sheo Karan Dass reported in (1977) 1 SCC 22 – 1976-VIL-43-SC;
(ix) Khazan Chand vs. State of Jammu and Kashmir reported in (1984) 2 SCC 456 – 1984-VIL-12-SC;
(x) Prahlad Rai vs. Sales Tax Officer reported in (1991) Supp (2) SCC 612 – 1990-VIL-20-SC;
(xi) Commissioner of Sales Tax vs. Qureshi Crucible reported in (1993) Supp (3) SCC 495 – 1993-VIL-10-SC;

Download the full Article below:No Interest Under GST on Delayed Filing…..

Minimum thirty days to be provided to reply to a GST SCN
 
Going to Tribunal under GST requires 30% pre-deposit. Moving to High Court in each case requires hefty charges which may be affordable in some cases but not in all cases. It seems that due to the said reasons taxpayers have now
surrendered to the fact that in many cases and in many states ADT-02 and DRC01A and thereafter DRC-01 is issued within a gap of one week sometimes in one day also!… However, if an Order is also issued without providing opportunity of being heard, then the back of the taxpayer is against the wall and he has to move forward and approach High Court. The question thus arises that what should be the reasonable time limit to be granted to reply to a SCN under GST. Section 73 does not provide the same and hence would it be left to the discretion of the officers? Let us therefore read Section 73(8) & 73(9), which state as follows –
(8) Where any person chargeable with tax under sub-section (1) or subsection (3) pays the said tax along with interest payable under section 50 within thirty days of issue of show cause notice, no penalty shall be payable and all proceedings in respect of the said notice shall be deemed to be concluded.

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Higher GST charged by the Vendor – ITC as well as refund available to the recipient
 
Consider the situation where the input product was chargeable only at the rate of 5% and assesses supplier mistakenly charged a higher rate of 18% GST on input for the final product, which is chargeable to a lower rate of GST of 5%. Inverted duty refund was denied on the grounds that –
1. Assesse should also have collected 18% GST, at par with the rate of tax paid
by the supplier for the input product.
2. Since the input product is chargeable only at the rate of 5%, however, it has
been wrongly made at the rate of 18% by the vendor of the assesse. Therefore,
the assesse cannot invoke Section 54(3) of CGST Act.

Download the full Article below:Higher GST charged by the Vendor – ITC as well as refund available to the recipient

Blocking of ITC u -s 86A is possible only when the officer has a strong case; opportunity of being heard has to be provided to the taxpayer also
 
Recently, the Hon’ble Supreme Court of India vide its decision dated 13.03.2023 in the case of State of Karnataka Versus M/s Ecom Gill Coffee Trading Private Limited [CIVIL APPEAL NO. 230 OF 2023 (Arising from SLP (Civil) No. 2572/2022)] – 2023-VIL-20-SC in paragraph Nos.14 and 15 held as under:
“..While claiming ITC as per section 70 of the KVAT Act, 2003, the purchasing dealer has to prove the genuineness of the transaction and as per section 70 of the KVAT Act, 2003, the burden is upon the purchasing dealer to prove the same while claiming ITC.
In view of the above and for the reasons stated above and in absence of any further cogent material like furnishing the name and address of the selling dealer, details of the vehicle which has delivered the goods, payment of freight charges, acknowledgement of taking delivery of goods, tax invoices and payment particulars etc. and the actual physical movement of the goods by producing the cogent materials, the Assessing Officer was absolutely justified in denying the ITC, which was confirmed by the first Appellate Authority…”

Download the full Article below:Blocking of ITC u -s 86A is possible only when the officer has a strong case; opportunity of being heard has to be provided to the taxpayer also

Department’s interest meter on refunds keeps ticking after 60 days of application… if taxpayer wins in appellate proceedings-pages
 
A very important judgment as held in the case of BANSAL INTERNATIONAL Vs COMMISSIONER OF DGST [2023-VIL-809-DEL], on Interest available to taxpayers on GST refunds needs thorough discussion.

Download the full Article below:Department’s interest meter on refunds keeps ticking after 60 days of application… if taxpayer wins in appellate proceedings-pages

Litigation on RCM on Expat Salary- Northern Operating Systems Case under GST – High Courts and CBIC Intervene
 
After the decision of The Hon’ble Supreme Court in Northern Operating System in the Service tax regime, across the Country taxpayers are calculating their exposure under GST. However, still issue which needs to looked into is that if the payment is made to expatriate employees in terms of the separate employment contracts entered into with them by the Indian Company, whether RCM would be applicable.
In the case of Northern Operating system, the remuneration was being paid by the foreign company to its employees seconded to serve in India. The assessee in that case was required to reimburse the payments to its foreign affiliate. Therefore, it was a clear case where the foreign company was the employer and not the Indian company. The payments were made in the said case, not on account of separate contracts entered into between the Indian company and its employees.

Download the full Article below:Litigation on RCM on Expat Salary- Northern Operating Systems Case under GST – High Courts and CBIC Intervene

Automatic and hybrid generation of status holder certificate by DGFT
 
Status Holder Certificates issued under FTP 2015-20 will remain valid till 30th September 2023 only and any IEC holder willing to avail the Status Holder Certificate under the FTP 2023. It has been provided by Public Notice No: 32/2023 & Trade Notice No. 28/2023-24 issued by the DGFT that The Status Holder Certificate (SHC) shall now be electronically generated based on export data available in DGCI&S database with no requirement by the exporter to file any kind of application in most cases. However, in certain cased an application may still be required to be filed online.

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Gold Coins; white goods given free by principals to dealers for achieving targets are supply under GST
 
The gold coins and white goods distributed by principals to the dealers, on the quantity lifted by the dealers, cannot be regarded as ‘gifts’ as the dealer is eligible for the gold coins and white goods only to the extent of amount lying as credit to his account and is subjected to the satisfaction of the terms and conditions of the Scheme. This would result in the enhancement of the sales of the company and could be considered as furtherance of business.
The transfer is not gratuitous and cannot be demanded, to qualify as gifts. Hence ITC on transfer of such gold coins would not be regarded as blocked ITC u/s 17(5)(h) of The CGST Act 2017. The Honourable Supreme Court in the case of Sonia Bhatia v. State of UP [1981 (3) TMI 250- Supreme Court) – 1981-VIL-06-SC, ruled wherein ‘gift’ has been held to hit a voluntary transfer of property by one to another, without any consideration or compensation.
Therefore A ‘gift’ is a gratuity and an act of generosity and does not require a consideration:
if there a consideration for the transaction, it is not a gift. In the same case, it was also held that a gift is a transfer which does not contain any element of consideration in any shape and form Love, affection, spiritual benefit and many other factors may enter in the intention of the donor to make a gift, but these filial considerations cannot be called or held to be legal considerations as understood by law.

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GST Rate Amendments w.e.f. 20th October 2023
 
This article explains the following GST Rate Amendments –
1. GST Inverted Refund available on works contract & other construction services
2. Certain ITC available for Rent a Cab operators
3. GST exemption on services to “Govt. Authorities” for water supply, etc
4. Services by Indian Railways under forward charge
5.  Forward charge on bus supplied by corporates through E-Commerce Operators
6. GST Rate amendment on millets, molasses & certain spirits
7. Other rate amendments

Download the full Article below:GST Rate Amendments from 20th Oct 23

Can GST Amount credited in Cash Ledger be considered as cash payment or not? Commissioner shall follow High Court directions or appeal against but cannot act in contempt

Many cases are pending wherein, during the initial years of GST, the taxpayers had issues and technical problems and the GST Authorities also did not have a solution. The cases include few like the following –
A. GSTR 3B return filed without showing an amount as payable in a month and the taxpayers were not guided that Form DRC-03 could be used to pay such an amount. Thus, they paid the same vide next GSTR-3B. Important to note
also is that Circular 26/26/2017 in this respect also was issued after quite some time into the GST regime.
B. Taxpayers were automatically migrated, and they could not file returns.
C. Taxpayers clicked the “save” button and not “submit” button while filing GSTR-3B and the same was considered as filed.

Download the full Article below: Can GST Amount credited in Cash Ledger be considered as cash payment or not? Commissioner shall follow High Court directions or appeal against but cannot act in contempt

 

Welcome Notices to note for Exporters and Importers

a. Exporters and importers in New Delhi/CLA, Mumbai, Coimbatore, Kolkata, Surat, Ahmedabad, Bangalore, Rajkot, Hyderabad, Chennai and Ludhiana, can get their pending EODCs for AdvanceAuthorisations and EPCG disposed off
b. GST-ITC allowed in case of transfer of duty free imported or indigenously procured materials, between the units located in same or different States
Exporters and importers in New Delhi/CLA, Mumbai, Coimbatore, Kolkata, Surat, Ahmedabad, Bangalore, Rajkot,Hyderabad, Chennai, and Ludhiana, can get their pending applications for Export Obligation Discharge Certificate
(EODC) for Advance Authorisations and EPCG disposed off with ease between 13.11.2023 to 24.11.2023, as provided by Trade Notice No. 29/2023-24 dated 13th October 2023. Exporters whose EODC applications are pending, and
their licence status is not reflected as ‘Closed’ on the DGFT Website, should make use of the 2-week EODC camp and ensure that un-redeemed licence pendency is disposed. The following points should be noted –
i. For applications wherein physical files were submitted for redemption / closure to the RA earlier, the RA on examination of the said files should generate the EODC letter online.
ii. Also, for cases where the authorisation was redeemed earlier but not updated by the RA online, the authorisation status should be duly updated in the online systems.
iii. Alternatively, the AAEPCG Authorisation holder may also submit EODC status update application by navigating to DGFT website –> Services –> AA / EPCG –> EODC Status update.
iv. RA as well as the Exporter is mandated to ensure that the status of all redeemed AA/EPCG authorisations are duly updated in the DGFT online systems.
v. EODC issued online are transmitted electronically to Customs ICEGATE System in near real-time, to facilitate the discharge of Customs bond and other related activities at the Customs port.
In another development, in a welcome move, vide Public Notice No. 34/2023 dated 13th October 2023, in case of transfer of duty free imported or indigenously procured materials, on which GST has been paid, between the units located in same or different States, the availment of Input Tax Credit has been allowed and shall be governed as per the provisions of the GST law & the rules made thereunder. Vide Para 4.10 (i) of the Handbook of Procedures 2023,
The DGFT had already permitted the transfer of any duty-free material imported or procured against Advance Authorisation from one unit of a company to another unit for manufacturing purpose with prior intimation to
jurisdictional Customs Author.

Download the full Article below :Welcome Notices to note for Exporters and Importers

 

Practical Application of GST on Gaming & Gambling vide Rule 31B & Rule 31C: Explanation with examples

Rule 31B of The CGST Rules inserted vide Not No 45/2023, provides for determining the Value of supply in case of online gaming including online money gaming. The same goes as follows –
Notwithstanding anything contained in this chapter, the value of supply of online gaming, including supply of actionable claims involved in online money gaming, shall be the total amount paid or payable to or deposited with the supplier by way of money or money’s worth, including virtual digital assets, by or on behalf of the player:
Provided that any amount returned or refunded by the supplier to the player for any reasons whatsoever, including player not using the amount paid or deposited with the supplier for participating in any event, shall not be deductible from the value of supply of online money gaming.
To explain with an example – Say a gamer deposits Rs. 1 Lakh before starting an online gaming session. He has to additionally pay Rs.28,000/- as GST. Thereafter he utilizes only Rs. 50,000 worth of his deposit, yet he will be refunded only Rs.50,000/- and not the proportionate GST of Rs.14,000/-.
Again, Rule 31C provides for Value of supply of actionable claims in case of casino as follows–
Notwithstanding anything contained in this chapter, the value of supply of actionable claims in casino shall be the total amount paid or payable by or on behalf of the player for –
(i) purchase of the tokens, chips, coins, or tickets, by whatever name called, for use in casino;
or
(ii) participating in any event, including game, scheme, competition or any other activity or
process, in the casino, in cases where the token, chips, coins or tickets, by whatever name called,
are not required:
Provided that any amount returned or refunded by the casino to the player on return of token, coins, chips, or tickets, as the case may be, or otherwise, shall not be deductible from the value of the supply of actionable claims in casino.
To explain with an example – Say a better deposits Rs. 1 Lakh before starting an a betting session. He has to additionally pay Rs.28,000/- as GST. Thereafter he utilizes only Rs. 50,000 worth of his deposit, yet he will be refunded only Rs.50,000/- and not the proportionate GST of Rs.14,000/-.
The silver lining is in the explanation to 31B & 31C which provides as follows –
Explanation.- For the purpose of rule 31B and rule 31C, any amount received by the player by winning any event, including game, scheme, competition or any other activity or process, which is used for playing by the said player in a further event without withdrawing, shall not be considered as the amount paid to or deposited with the supplier by or on behalf of the said player.”
To explain with an example – Say a better/gamer deposits Rs. 1 Lakh before starting a betting/gaming session. He has to additionally pay Rs.28,000/- as GST. Thereafter he utilizes only Rs. 50,000 worth of his deposit, but wins Rs.5,00,000/-, he will take home as follows –
Particulars Base Value GST Total
Inital Deposit -1,00,000.00 -28,000.00 -1,28,000.00
Prize money 5,00,000.00 5,00,000.00
refund of unutilized deposit amt. 50,000.00 50,000.00
Excess Take home 4,50,000.00 -28,000.00 4,22,000.00
Hence, the proviso to Rule 31B & 31C seems to change the taxable event from ‘supply’ to ‘expected supply’. Even though an actionable claim is a beneficial ownership in debt, yet when no supply is received at all, the non-reduction of the refunded amount from the value of supply seems to stretch the taxability. However, the explanation to the Rules makes it clear that the GST Authorities seek to control only the entry point and not post that and hence even the prize money is not taxable, just like in case of a lottery.

Download the full Article below :Practical Application of GST on Gaming & Gambling vide Rule 31B

 

Discipline regarding “quasi-criminal” penal proceedings

Discipline regarding penal action under various tax laws are widely discussed. Two interesting recent cases under Income Tax allows one to reflect further. Generally, losses are contested and seldom is it seen that assessee accept a loss return to be assessed as NIL. However, what if in spite of an irrefutable loss the assessee in good faith and, to avoid undue litigation, harassment and, to buy peace of mind agrees to get assessed at NIL income instead of declared loss, can a penalty/prosecution proceeding be initiated against the assessee u/s
271(1)(c) of the Income Tax Act? The answer is that it can be initiated. There is no provision for such pleas of bargain under the Income Tax Act to act as estoppels upon AOs. However, in case the plea is not accepted by the AO, the assessee should be show caused and there should be substance in enquiry and evidence to prove concealment. Penalty proceedings are distinct from assessment proceedings, though they emanate from the assessment proceedings; still, they are separate and independent proceedings all together. The Hon’ble Supreme Court of India in the case of CIT & Act. Vs. M/s SSA’s Emerald Meadows in CC dated 05.8.2016 [2016]73 Taxmann.com 48 (SC) has held that notice issued by the Assessing Officer under section 274 read with section 271(1)(c) of the Act was bad in law, as it did not specify under which limb of section 271(1)(c) of the Act, penalty proceedings has been initiated, i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income. The assessee should know the grounds which has to meet, otherwise the principles of natural justice are offended. Further, the order has to specify the offence alleged to be committed, as was held in the case of M/s UNITECH REALTY PVT. LTD Vs DCIT, CIRCLE – 27(1), NEW DELHI [2023-VIL- 1036-ITAT-DEL].

Download the full Article below :Discipline regarding “quasi-criminal” penal proceedings..

 

Non-filing of the returns does not empower the GST Authorities to cancel the registration retrospectively

In some cases, such is the interpretation of some of certain field officers that SCNs flow to recipients of earlier supplies, even after a prospective cancellation/suspension of registration of suppliers after the date of such supply. Hence, retrospective cancellation would certainly involve denial of ITC of recipients who have received supplies before the cancellation/suspension of registration. However, It seems that for certain GST field officers cancellation of registration means retrospective cancellation – something which has serious ramifications. Section 29 of the CGST Act, 2017, grants discretionary powers to the concerned authority to cancel the registration from a retrospective date. However, such powers have to be exercised only in eligible cases. Cancellation on grounds that the petitioner had not filed the returns for a continuous period of six months does not justify retrospective cancellation from the date when the registration was granted. Where the taxpayer has closed its business altogether and thereafter stopped filing returns, a stand cannot be taken by the dept. to cancel the GST registration retrospectively thereby even making the earlier supplies of the taxpayer irregular. It’s a simple case when one reads the order in hindsight but it had to be contested by the taxpayer in High Court and a decree taken in the case of ASHISH GARG PROPRIETOR SHRI RADHEY TRADERS Vs ASSISTANT COMMISSIONER OF STATE GOODS AND SERVICE TAX, DELHI ZONE 7 WARD 82 .

Download the full Article below :Non-filing of the returns does not empower the GST Authorities to cancel the registration retrospectively

 

Sugar Manufacturing Co-operatives may now get their old IT demands dropped by filing applications u/s 154 and u/s 155(19)

The recent amendments in the Income Tax Act have provided much-needed relief to co-operative sugar factories operating in India by allowing deductions for sugarcane purchases made at or below the government-approved price. The Finance Act 2023 amended section 155 to allow AO to recompute the total income of a sugar mill co-operative and allow the deduction for sugarcane purchase expenditure that was equal to or less than the Government fixed price. The new section 155(19) empowers the Assessing Officer to recompute the total income for previous years with disputed deductions, resolving long-standing tax litigation. By following the SOP provided in Circular 14 of 2023 dated 27th July 2023, co-operative sugar factories can make applications to the JAO with the prescribed documents to resolve their tax disputes amicably.

Download the full Article below :Sugar Manufacturing Co-operatives may now get their old IT demands dropped by filing applications u_s 154 and u_s 155(19)

 

Analysis of GST Notifications dt’ed 31st July 2023

Friends,

One more set of notifications have been issued under GST, even as we await the 51st GST Council Meeting to be held on 2nd August 2023. The following are our brief analysis of the notifications as follows –

 

  1. Analysis of Not No 31/2023 – Central Tax –

 

Rule 8(4A) States as follows –

10[(4A) Where an applicant, other than a person notified under sub-section (6D) of section 25, opts for authentication of Aadhaar number, he shall, while submitting the application under sub-rule (4), undergo authentication of Aadhaar number and the date of submission of the application in such cases shall be the date of authentication of the Aadhaar number, or fifteen days from the submission of the application in Part B of FORM GST REG-01 under sub-rule (4), whichever is earlier.

Download the full Article below :Article – 31st July 23 – GST Notifications Analysis – TC

 

EV Vehicle charging stations to provide ‘battery charging service’ and not supply or distribution of ‘electricity’ – liable to GST @ 18%

Classification under GST Law can sometimes be contrary to general understanding. The charging of a battery in EVs requires electricity and an electricity company will provide electricity supply to the public charging stations which will in-turn provide the electricity to all electric vehicle users who can access these pubic charging stations for battery charging. General understanding is that the EV vehicle battery shall be charged with electricity (which is an exempt goods)’, but The AAR dug deep and concluded that it is ‘Battery Charging Service’. The AAR Karnataka has opined that the charging of EV vehicles will be a service liable to GST @18% in the case of M/s CHAMUNDESWARI ELECRICITY SUPPLY CORPORATION LIMITED [2023-VIL-147-AAR].

Download the full Article below : EV Vehicles charging stations to provide ‘battery charging service’ and not supply or distribution of ‘electricity’ – liable to GST @ 18%

 

Analysis of the GST, Compensation and Customs rate Notifications issued on 26th July 2023 apropos the recommendations of the 50th GST Council Meeting.

CGST Rate Notifications

  1. Amendment to Notification No. 11/2017-Central Tax (Rate) so as to notify change in GST with regards to services as recommended by GST Council in its 50th meeting
  1. Amendment to Notification No. 12/2017-Central Tax (Rate) so as to notify change in GST with regards to services as recommended by GST Council in its 50th meeting
  1. Amendment to Notification No. 13/2017-Central Tax (Rate) so as to notify change in GST with regards to services as recommended by GST Council in its 50th meeting
  1. Amendment to Notification No. 01/2017-Central Tax (Rate) to implement the decisions of 50th GST Council Meeting
  1. Amendment to Notification No. 26/2018-Central Tax (Rate) to implement the decisions of 50th GST Council Meeting

 

Compensation Cess Notification

  1. Amendment to Notification No. 1/2017-Compensation Cess (Rate) to implement the decisions of 50th GST Council Meeting

 

Customs Notification

  1. Amendment to Notification No. 45/2017-Customs, Notification No. 47/2017-Customs and Notification No. 50/2017-Customs all dated 30th June, 2017

Download the full Article below : 27th July 2023 – Analysis of Notifications

 

Incase of cancellation of contracts, the supplier cannot sit on refund of GST to the recipient, pending receipt of refund from the GST Department

Government Customers or suppliers always try to have the upper hand in dealings with private players. Incase contracts are cancelled, there is always a question of how to adjust the GST paid earlier, especially if no outward tax liability is available. In this regard, Sl No 3 of Circular No. 137/07/2020-GST dated 13.4.2020 specifies the following –

 

1. An advance is received by a supplier for a Service contract which subsequently got cancelled. The supplier has issued the invoice before the supply of service and paid the GST thereon. Whether he can claim a refund of tax paid or is he required to adjust his tax liability in his returns?

In case GST is paid by the supplier on advances received for a future event which got cancelled subsequently and for which an invoice is issued before the supply of service, the supplier is required to issue a “credit note” in terms of section 34 of the CGST Act. He shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim. However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.

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GST Circulars & Notifications dt. 17th July 23 w.r.t. 50th GST Council Decisions_Tax Connect’s Analysis
We are pleased to put forth our Tax Connect’s Analysis of GST GST Circulars & Notifications  dt. 17th July 23 w.r.t. 50th GST Council Decisions as follows –
Circular Remarks
Circular 195 of 2023 No GST on Warranties
Circular 199 of 2023 ISD & Cross Charge – Both Are Valid
Circular 192 of 2023 No Interest when IGST-ITC is wrongly availed & utilized.. To the extent accumulated balance of CGST/SGST ITC is available
Circular 193 of 2023 ITC Mismatches – Extension of Circular 183 of 2022, till 31.12.2021
Circular 197 of 2023 GST Refunds – Various Clarifications
Circular 194 of 2023 TCS where multiple ECO operators are involved
Circular 198 of 2023 E-Invoicing to Govt. departments
Circular 196 of 2023 No GST on Group Companies holding
Notifications 18 to 26 of 2023 – CGST Extention of Amnesty Schemes
We hope this Analysis add value in your professional sphere!