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Key Updates in Goods & Services Tax – August 2019

August 13, 2019 | GST, GST in India, Latest Tax Update, Latest Update

Amendment to CGST Rules 2017 Notification No. 33/ 2019-CT Multiplex screens As per 4th provision to Rule 46 of CGST Rules 2017 Supplier need not issue an invoice for each of the supplies in case of Multiplex screens, rather he can issue a consolidated invoice at the end of the day where:
  • If the value of the invoice is less than Rs.200 [Sec 31(3)(b) of CGST act,2017],
  • Recipient is not a registered person and
  • The recipient also doesn’t want an invoice,
The above said provision has been amended to exclude the persons supplying services by way of admission to exhibition of cinematograph films in multiplex screens. Further new sub-rule 4A has been inserted in Rule 54 to specify that, such persons should issue an electronic ticket. The ticket should contain all the details as required in Rule 46, except the details of the recipient and such ticket shall be considered as the tax invoice for all the purpose of the act. It is also specified that, for other than multiplex suppliers, this is optional. E-Way Bills: The Rule 138E, related to Restriction on furnishing of information in PART A of the E-way bill, has been amended to notify the forms for releasing the restriction:
  • FORM GST EWB-05 for the application by the supplier
  • FORM GST EWB-06 for issuing the order by the commissioner
Anti-profiteering: The tenure of “The National Anti-Profiteering Authority” has been extended from 2yrs to 4yrs by amending Rule 137. Due date for filing of CMP-08 return extended Central Government vide Notification No. 35/ 2019-Central Tax has extended the due date for filing of CMP-08 (a statement containing the details of payment of self-assessed tax to be filed by composition taxpayer ) for the period  April 2019 to June 2019 from 31st July 2019 till 31st August 2019 GST on ‘Electrically operated vehicles As per Notification No. 12/ 2019-Central Tax (Rate) GST rate on electrically operated vehicles, including two and three-wheeler electric vehicle has been reduced from 12% to 5%. Further, GST rate on charger or charging stations for Electric vehicles has been reduced from 18% to 5% GST on Hiring of Electric operated Vehicle by Local Authorities        As per Notification No. 13/ 2019-Central Tax (Rate) GST on the hiring of electric operating vehicle by Local Authority has been exempted. Clarification for treatment of Goods sent/taken out of India “for exhibition” Considering the different types of treatments for the transaction of sending goods out of India as exports / otherwise, the department Circular No.108//27/2019- GST dated 18-07-2019 has clarified that
  • The said movement doesn’t amount to supply, as there is no consideration and also it doesn’t fall under Deemed supplies as specified in Schedule-I of CGST Act, 2017
  • Since it is not a supply, it can’t be a zero-rated
  • If not a supply, Documents & procedure for transportation are as under:
-The goods should be sent by issuing a delivery challan -No GST required to be paid -Also, no LUT/Bond are required to be executed Further, if the goods sent/taken out doesn’t come back within 6 months from the date of sending the goods, the same shall be treated as supply and invoice is required to be issued. In such case refund can be claimed for accumulated credit but not for the taxes paid. Clarifications w.r.t. GST Annual Return and Audit – Press release dated July 3, 2019 Central Government vide press release on 3rd July 2019 has clarified the many of the issue in respect of Annual Return (FORM GSTR-9 / FORM GSTR-9A) and Reconciliation Statement (FORM GSTR-9C). Few of those are as below:
  1. Payment of unpaid tax (if any)- In cases where some information / outward liability has not been reported in the statement of outward supplies in FORM GSTR-1 or in the regular returns in FORM GSTR-3B. Then is such situation taxpayers may pay the tax with interest through FORM GST DRC-03 at any time.
  2. Primary data source for declaration in annual return- There has been some commotion regarding the information to be filled in GSTR 9 should be from FORM GSTR-1, FORM GSTR-3B or books of accounts. Ideally, information in FORM GSTR-1, FORM GSTR-3B and books of accounts should be same and the values should match across different forms and the books of accounts.
If there is any difference between the returns, there can be mainly two reasons-
  1. Either tax was not paid to the Government- In this case, the same shall be declared in the annual return or tax should be paid.
  2. Tax was paid in excess– In this case, all information may be declared in the annual return and refund (if eligible) may be applied through FORM GST RFD-01A.
It should be noted that no input tax credit can be reversed or availed through the annual return. If taxpayers find themselves liable for reversing.
  1. ITC available as per GSTR 2A but not availed: The input tax credit which is declared/computed in Table 8D is basically credit that was available to a taxpayer in his FORM GSTR-2A but was not availed by him between July 2017 to March 2019. The deadline has already passed and the taxpayer cannot avail such credit now. There is no question of lapsing of any such credit, since this credit never entered the electronic credit ledger of any taxpayer. Therefore, taxpayers need not be concerned about the values reflected in this table. This is merely information that the Government needs for settlement purposes.
  2. IGST on Import: It has already been clarified that all credit of IGST paid at the time of imports between July 2017 to March 2019 may be declared in Table 6E. If the same is done properly by a taxpayer, then Table 8I and 8J shall contain information on credit which was available to the taxpayer and the taxpayer chose not to avail the same. The deadline has already passed and the taxpayer cannot avail such credit now. There is no question of lapsing of any such credit, since this credit never entered the electronic credit ledger of any taxpayer. Therefore, taxpayers need not be concerned about the values reflected in this table. This is information that the Government needs for settlement purposes.
  3. Reverse charge in respect of Financial Year 2017-18 paid during Financial Year 2018-19
It has been clarified that tax which was to be paid on reverse charge basis for the FY 2017-18 but was paid during FY 2018-19, will not be declared in the annual return for the FY 2017-18. These details will be declared in the annual return for FY 2018-19 because the payment was made during FY 2018-19, the input tax credit on such payment of tax would have been availed in FY 2018-19 only. If there are any variations in the calculation of turnover on account of this adjustment, the same may be reported with reasons in the reconciliation statement (FORM GSTR-9C).
  1. Reconciliation of input tax credit availed on expenses: It has been clarified that only those expenses are to be reconciled and reported in table 14 of reconciliation statement
where input tax credit has been availed. Further, the list of expenses given in Table 14 is an indicative list of heads under which input tax credit may have been availed. The taxpayer has the option to add any head of expenses. Clarification on supply of IT enabled services Considering the different types of treatments for the transaction of Information technology-enabled services (ITeS in short), the department has clarified on the issues related to supply of Information Technology enabled Services (“ITeS services”) such as call center, business process outsourcing services, etc. and “Intermediaries” to overseas entities under GST law and whether they qualify to be “export of services” or otherwise: Definition of Intermediary- “Intermediary means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both, or Securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account”. The definition of intermediary services provides specific exclusion of a person i.e. that of a person who supplies such goods or services or both or securities on his own account. Therefore, the person supplying services on his own account can never be an intermediary, irrespective of the facts to whom / on whose behalf such services are provided. The clarification has been done considering three scenarios which are as below:
  1. Supplier of ITeS services as back end service- In such a scenario, the supplier will not fall under the ambit of intermediary in GST laws where these services are provided on his own account by such supplier. Even where a supplier supplies ITeS services to customers of his clients on clients‟ behalf, but actually supplies these services on his own account, the supplier will not be categorized as intermediary.
  2. Supplier of backend services located in India arranges or facilitates the supply of goods or services or both by the client located abroad to the customers of client. Such backend services may include support services, during pre-delivery, delivery and post-delivery of supply (such as order placement and delivery and logistical support, obtaining relevant Government clearances, transportation of goods, post-sales support and other services, etc.). In this case supplier of services will fall under the ambit of as per GST laws as these services are merely for arranging or facilitating the supply of goods or services or both between two or more persons.
The supplier of ITeS services supplies back end services, on his own account along with arranging or facilitating the supply of various support services during pre-delivery, delivery and post-delivery of supply for and on behalf of the client located abroad. In this case, the supplier is supplying two set of services, namely ITeS services and various support services to his client or to the customer of the client. Whether the supplier of such services would fall under the ambit of intermediary will depend on the facts and circumstances of each case and would be determined keeping in view which set of services is the principal/main supply.   Last Updated: 12th August 2019 This article is contributed by:  Vaibhav Matta Assistant Director, Taxation

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