TaxTMI 
TaxTMI 
Minutes of the 47th Meeting of GST Council held on 28th & 29th June 2022
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....Issuance of clarification on issue of claiming refund under inverted duty structure where the supplier is supplying goods under some concessional notification ii. Amendment in formula prescribed in sub-rule (5) of rule 89 of CGST Rules, 2017 for calculation of refund of unutilized Input Tax Credit on account of inverted duty structure_______________________________ iii. Authority to issue recurring SCN in case of an enforcement action initiated by the Central authorities against a taxpayer assigned to State and vice versa iv. Clarification on various issues relating to applicability of demand and penalty provisions under the Central Goods and Services Tax Act, 2017 in respect of transactions involving fake invoices v. Notifying clause (c) of section 110 and section 111 of the Finance Act, 2022 vi. lssuance of clarification on various issues pertaining to GST vii. Issue of compulsory registration for supplier supplying goods or services through ECOs under section 24(ix) of the CGST Act, 2017 and allowing Composition dealers to use e-Commerce platforms__________________ viii. Refund of unutilized Input Tax Credit ....
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.... made by the Fitment Committee on issues related to Four and Hospitality Sector, and on positive list of services to be specified in Sr. No. 3/3A of Notification No. 12/2017-CT(R) as given at Annexure-IVA and Annexure-IVB, respectively to the Agenda e) Issues where no change has been proposed by the Fitment Committee in relation to services - Annexure V to the Agenda f) Issues deferred by the Fitment Committee for further examination in relation to services -Annexure VI to the Agenda 7 C-PACE Project for Ease of Doing Business in India 8 C-PACE Project for Ease of Doing Business in India______________________ 9 Report of Group of Ministers on feasibility of implementation of e-way bill requirement for movement of gold and precious stones.____________________ 10 Proposal to apportion IGST amount of Rs.27,000 crore for the financial year 2022-23 on ad hoc basis 11 Amendments lo provisions relating to GSTAT in CGST Act, 2017 12 Ad-hoc Exemption Orders issued under Section 25(2) of Customs Act, 1962 for Information 13 Recommendations of the 16th IT Grievance Redressal Committee for approval/dec....
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....sion and offer other suggestions that can help avoid frauds in GST. The GoM comprised Hon'ble Members from Haryana, Assam, Tamil Nadu, Delhi, Andhra Pradesh, Chhattisgarh and Odisha. The GoM had submitted its interim report which was placed before the Council for deliberations in the present agenda. The Secretary thanked all the Hon 'ble Members of this GoM for their valuable recommendations. 3.5 The Secretary also stated that in 45th meeting at Lucknow, a GoM on Rate Rationalization was formed with Sh. Basavaraj S. Bommai, Hon'ble Chief Minister, Karnataka as Convener and other Hon'ble Members from Bihar, Goa, Kerala, Rajasthan, Uttar Pradesh and West Bengal as Members. The GoM had submitted its interim report which was being placed in this Council meeting for deliberations. He thanked all the Hon'ble Members of this GoM for their valuable recommendations. 3.6 The Secretary further pointed out that the GST Revenue had set new records this year. The gross GST revenue collected in the month of April, 2022 was Rs.1,67,540 crores which was 20% higher than the GST revenues in the same month last year. The gross GST revenue collected in the month of M....
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....s issued by the States which were on the same subject as the above notifications, Circulars and Orders were also ratified. Agenda Item 3: Issues recommended by the Law Committee for the consideration of the GST Council 6. The Secretary took up the next Agenda on issues recommended by the Law Committee for the consideration of the GST Council. He informed that these agendas were discussed in detail in the Officers' Meeting held on 27th June, 2022 and there was an agreement in the Officers meeting on most of the issues. He further informed that Agenda items 3(iv), (vii) and (xii) may require deliberation of the GST Council. Thereafter, Principal Commissioner, GST Policy Wing made a detailed presentation (attached at Annexure-3) giving overview of the recommendations made by the Law Committee on the said agendas. Agenda Item 3(i): Issuance of clarification on issue Of claiming refund under inverted duty structure where the supplier is supplying goods under some concessional notification 7. The Principal Commissioner, GST Policy Wing informed that vide Circular No. 135/05/2020-GST dated 31.03.2020, it had been clarified that refund on account of accumulated ITC in ....
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....account of inputs and input services for payment of output tax in the same ratio in which the ITC has been availed on inputs and input services during the said tax period and to use this deduction to revise the formula prescribed in rule 89(5) as suggested by the Hon'ble Supreme Court. Accordingly, Law Committee recommended the following amendment in formula prescribed in rule 89(5): Maximum Refund Amount - {(Turnover of inverted rated supply of goods and services) x Net ITC + Adjusted Total Turnover} - {tax payable on such inverted rated supply of goods and services x (Net ITC* ITC availed on inputs and input services)}. The Council agreed with the recommendation of the Law Committee. Agenda Item 3(iii): Authority to issue recurring SCN in case of an enforcement action initiated by the Central authorities against a taxpayer assigned to State and vice versa 7.4 The Principal Commissioner, GST Policy Wing informed that references had been received regarding diverse practices in the field on the issuance of recurring Show Cause Notices (SCNs) arising out of investigation initiated and finalized by Central Tax authorities against taxpayers under State Administration an....
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....ases. 7.10 The Hon'ble Member from Kerala expressed his apprehension that the proposed Circular might promote fake invoicing, that prosecutions were launched after quantifying the duty demand whereas the proposed Circular stated otherwise, and thus, it would reduce the deterrence for issuance of fake invoices thereby causing loss to the exchequer of both Centre and States. 7.11 The Principal Commissioner, GST Policy Wing clarified that the proposal did not prohibit prosecution and the people issuing fake invoices would continue to be liable for penalty and prosecution. The Circular clarifies the applicability of legal provisions in cases where only fake invoices are issued without corresponding supply of any goods or services. In such situations, GST cannot be levied as there is no supply. But simultaneously, it is proposed that penal actions can be taken under Section 122 Of the Act. Further, such person is liable for prosecution under Section 132 where the amount involved is more than the specified amount under the said provision. 7.12 The Secretary further emphasized that in such scenarios as discussed, there would be no tax demand but penalty and prosecution provis....
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....ty exists in the electronic liability register of the said registered person. 7.18 The Principal Commissioner, GST Policy Wing informed the Council that Section 111 Of The Finance Act, 2022 was regarding the retrospective amendment of interest provisions as per earlier decision of the Council. Vide the said amendment, Section 50 (3) of the CGST Act, 2017 was proposed to be amended retrospectively w.e.f. 01.07.2017 in order to clarify that where ITC has been wrongly availed and utilised, the registered person shall pay interest only on such input tax credit which is wrongly availed and utilized. Further, the rate of interest chargeable under Section 50(3) of CGST Act shall be 18% (instead of 24%) with retrospective effect from 01.07.2017. The manner of calculation of interest as per this provision is to be provided through Rules and the Law Committee recommended insertion of new Rule 88B for calculation of interest on delayed payment of tax. 7.19 The Principal Commissioner, GST Policy Wing proposed that they may be notified by the Centre at the earliest. Regarding the rest of the provisions of the Finance Act, 2022 which States are required to pass, the Council was informed th....
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....vessels and aircrafts only and not to leasing of any other items and accordingly, availment of ITC was not barred for other items under the said sub clause in case of leasing. 7.23.3 Another issue was whether various perquisites provided by employer to its employees as per contractual agreement, were liable for GST. The Law Committee clarified that any perquisites provided by employer to its employees in accordance with the terms of contract were in lieu Of services provided by the employee and as per Schedule Ill of the CGST Act, the same would not be subjected to GST. 7.24. Clarification on utilisation of the amounts available in the electronic credit ledger and the electronic cash ledger for payment of tax and other liabilities 7.24.1 The third issue was regarding utilization of the amounts available in the electronic credit ledger and the electronic cash ledger for payment of tax and any other liability other than tax. The Law Committee recommended that amounts available in electronic credit ledger can be used for making payment of output tax only. It cannot be used for paying any tax under Reverse Charge Mechanism (RCM) or any interest, penalty, fees or any Other....
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....pply. The details of these supplies made by the unregistered persons through their PAN will be given in the GSTR 8 filed by the Electronic Commerce Operators (ECOs). In cases where the total supply approaches the threshold limit, it would be flagged to the concerned supplier to take registration and to officers for information. Further, the suppliers would not be required to pay any tax upto supplies of specified threshold limits and Electronic Commerce Operators (ECOs) would not deduct TCS till the suppliers cross the threshold limit. Further, the agenda note also proposes that composition dealers be allowed to make intra state supplies through Electronic Commerce Operators (ECOs), which is presently restricted. 7.27 The Principal Commissioner, GST Policy Wing sought in principle approval of the Council regarding these agendas and stated that post approval, the Law Committee could be authorized to work out further modalities. Also, corresponding changes in GSTN portal would be required. In the officers' meeting, it was decided that if the Council approves, 1st January, 2023 would be notified as date of implementation. Further, the Law Committee recommended a condition that ....
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....la but was doing business in Haryana through Amazon and business in Gujarat through Flipkart. In such scenarios how would turnover be tracked. Further, what will happen if such person defaults since the person is unregistered and there is no physical existence in States of Haryana and Gujarat. The Hon'ble Member from Bihar welcomed the proposal and requested for strict monitoring of these suppliers. 7.31 The Hon'ble Member from Karnataka stated that this would create a level playing field between offline and online suppliers. He stated that it is important to have a centralized monitoring system in such cases. The Principal Commissioner, GST Policy Wing informed that all these unregistered persons would be required to make a PAN based declaration on the portal along with Mobile No., place of business etc. before using the Electronic Commerce Operators (ECOs) platform for making supplies. The Electronic Commerce Operators (ECOs) would ensure that no inter-State supply would be made and the supply made by unregistered person (PAN wise) would be declared in their monthly GSTR FORM 8. The aggregate of total turnover made through different Electronic Commerce Operators (ECOs)....
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....01.01.2023, subject to preparedness on the portal as well as by Electronic Commerce Operators (ECOs). Agenda Item 3(viii): Refund of unutilised Input Tax Credit on account of Export of Electricity 7.37 The Principal Commissioner, GST Policy Wing stated that reference had been received from Ministry of Power wherein they had highlighted the problem faced in filing of refund of unutilised Input Tax Credit (ITC) on account of export of electricity and has requested to expedite the refund of input tax credit to the electricity exporters. 7.38 The electricity being an intangible good, the export of electricity is neither covered by any Shipping Bill/ Bill of export nor is there any requirement of filing EGM in respect of export of electricity, due to which the exporters of electricity are not able to file the refund claim of unutilized ITC on the GST Portal. 7.39 It was also mentioned that electricity is exported through transmission lines which are laid either underground or on pillars attached/fixed to the ground thereby implying that the export of electricity takes place by land. Further, relevant date in case of export of goods by land, has been specified at Explanation ....
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...., and suggested that in the long run, the annual return should cover the features Of proposed changes in GSTR-3B. Accordingly, the annual return fonns (GSTR-9 and GSTR-9C) for FY 2021-22 may be notified with minimal changes to the forms notified for FY 2020-21. The Law Committee examined the relaxations provided in FY 2020-21 and has recommended modifications / continuation / discontinuation of such relaxations based on their present relevance as detailed in the said Agenda. Further, the Aggregate Annual Turnover (AATO) threshold for granting exemption from filing annual return in FORM GSTR-9/9A, which was Rs.2 crore for FY 2020-21, may be continued for FY 2021-22 also. The GST Council approved the agenda item and recommended - a. To continue with most of the relaxations as provided for FY 2020-21, barring a few as detailed in agenda note, such as seeking HSN details in Table 17 Of GSTR-9, as requirement of reporting HSN in invoices were changed w.e.f. 01.04.2021. b. AATO threshold for granting exemption from filing annual return in FORM GSTR-9/9A, which was RS 2 crore for FY 2020-21, may be continued for FY 2021-22 also Agenda Item 3(x): Clarification on ma....
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....rough the Finance Act, 2022 and will come into effect once the said provisions Of the Finance Act, 2022 are notified. The proposed changes ensure that the GSTR-1-GSTR 2B linkage remains intact and as far as possible, the GSTR-3B should be auto-generated consequent to furnishing details in GSTR-I. The proposal, inter-alia, seeks modification in Table 3 of GSTR-3B for allowing auto- population of values from GTSR-I into GSTR-3B in specific rows; modification in Table 4 of GSTR-3B for capturing line wise reversals for streamlining the process of settlement of IGST revenues; providing for amendment tables for reporting of various amendments in outward supplies, input supplies liable to reverse charge and ITC for the previous tax periods; and some amendment in GSTR-I to capture the details of supplies made through Electronic Commerce Operators(ECOs) in separate Table 14, 15, 16. The GST Council recommended that the proposal for comprehensive changes in FORM GSTR-3B to be placed in public domain for seeking inputs/suggestions of the stakeholders. Thereafter, Law Committee to examine the suggestions and bring before the GST Council for approval. The exercise may be done in a time bo....
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....ill modality was put in place for automatic revocation of suspension by the system. Also, if suspension is done manually by an officer then it should not be revoked automatically. The Secretary informed that GSTN is ready with the suspension utility and revocation utility and that whenever the system is rolled out, the facility would be ready to revoke the suspension as soon as returns get filed. 7.50 On the point raised by Hon'ble Member from Haryana that automatic revocation be not done in case of manual suspension of registration, GSTN stated that necessary check would be introduced in system, if it was already not enabled. 7.51 The Principal Commissioner, GST Policy Wing further clarified that the changes proposed in Rules were only in respect of cases where registration is cancelled by the system and not by the officer. He informed that all the amendments were agreed to in the Officer's meeting. He further informed that Maharashtra has given a suggestion in respect of rule 46 that specific declaration to be incorporated under proposed clause (s) of rule 46 and it was agreed to. It was also suggested that changes in GSTR-I to capture the details of supplies throug....
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....of lockdown/restrictions. He informed that the issue was deliberated by the Law Committee in its meeting held on 11.04.2022 and 07.05.2022. The Law Committee observed that Centre as well as State governments were working with reduced staff, along with staggered timings and exemption to certain categories of employees from attending offices, from time to time during COVID period. Further, it was a conscious policy decision not to do enforcement actions in the initial period of implementation of GST Law, thereby no action for scrutiny, audit etc. could be undertaken during initial period of GST implementation. Since the due date of filing Annual return for FY 2017-18 was 5th/7th February, 2020, based on which limitations for demand under the Act are linked, and since the onset of COVID happened immediately after that, thereby, audit and scrutiny for FY 2017-18 were impeded due to various restrictions during COVID period. The Law Committee, accordingly, recommended that limitation under section 73 for FY 2017-18 for issuance of order in respect of demand linked with due date of annual return. may be extended till 30th September. 2023 under the powers available under section 168A of CG....
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....ayer. In case the liability had already been paid through challan or by adding in the liability of the subsequent period, the same was advised to be claimed as refund. 7.56 The Principal Commissioner, GST Policy Wing mentioned that on account of representations received from taxpayers stating that they are suddenly facing cash crunch for paying the remaining amount as per GSTR-4 return by the due date i.e., 30.04.2022 the Law Committee had recommended that late fee may be waived for delay in filing GSTR-4 for FY 2021-22 for the period 01.05.2022 till 30.06.2022 and this was subsequently approved by the GST Implementation Committee. 7.57 Considering the large number of representations from the taxpayers regarding difficulty being caused due to negative balance in ECL, the status of issue was placed by GSTN before the Law Committee. The Law Committee recommended that the negative balance in cash ledger as on date may be nullified by passing a credit entry of equal amount in the System and that list of all such cases may be sent to tax authorities for necessary verification and recovery, if any. Also, that where the taxpayer has paid the liability twice, he may seek refund. GSTN....
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....d to Duty Free Shops on account of supplies made by them to international passengers either at Arrival Terminal or also in respect of sales made at Departure Terminal or both. The policy measures/options were discussed by the Law Committee and the following recommendations of the Law Committee were placed for deliberations and approval by the GST Council: i, To align rules and notifications with the decision of Hon'ble High Courts to treat the supply of goods by Duty Free Shops to outgoing international passengers as zero-rated supply by:- a. rescinding rule 95A of the CGST Rules, 2017 and Circular No. 106/25/2019- CIST dated 29.06.2019 ab initio*, b. To rescinding Notification No. 10/2019-lntegrated Tax (Rate), Notification No. 11/2019-CentraI Tax (Rate) and Notification NO. 11/2019-Union territory Tax (Rate) all dated 29.06.2019 ii For future, there is a need to exclude refund in respect of ITC on inputs/ input services pertaining to Duty Free Shops at Arrival Terminal by amending Explanation to sub-section (3) of section 17 of CGST Act by including certain transactions under paragraph 8(a) of Schedule Ill of CGST Act in the value of exempt....
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..... The Council agreed to the proposal and accordingly recommended that- a. Present refund mechanism to exporters have been stabilised and streamlined, with exporters now being fairly acquainted with the refund processing under GST. Present Exemption Notifications of IGST and cess etc. on import of goods under AA/EPCG/EOU scheme may be continued. b. E-wallet scheme may not be pursued further. Agenda Item 3 (xviii): Amendment in CGST Rules for handling of pending IGST refund claims 7.61 The Principal Commissioner, GST Policy Wing mentioned that at present, the processing of refund of IGST paid on account of export of goods under provisions of Section 16(3)(b) of IGST Act is system based and is done in accordance with Rule 96 of CGST Rules. Rule 96(4) provided for withholding of refunds only in two specified situations and it does not provide for withholding the refund on account of exporter having being identified as a risky exporter by the system. The Law Committee recommended amendment in Rule 96(4) to include this scenario. Further, Rule 96(5) provided for transmission of intimation Of withholding of IGST refunds to the jurisdictional proper officer, appl....
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....ught in place by Reserve Bank of India for consent based sharing of financial data are in pipeline. 7.63 The proposal of amending the GST Acts to allow sharing Of supply data with the consent of the supplier and the recipient with these systems, was discussed by Law Committee and it suggested that the "Amendment to be done in CGST/SGST Act to this effect which will incorporate due safeguards for indemnity and non-liability of GSTN/GST authorities (without prejudice to any action under GST Law). The proposed amendment to ensure the provision for non-disclosure clause." 7.64 The Law Committee proposed to insert new Section 158A in the GST Acts to enable sharing. The exact mode of obtaining consent and sharing of data would be outlined in rules. 7.65 Accordingly, the Agenda item was put up before the Council to seek its approval in order to carry out the proposed amendments in the respective GST Laws and it was also proposed that in the meantime, consent based data sharing module may be implemented with appropriate safeguards. This Agenda item was agreed to in the Officers Meeting held on 27 th June 2022. The Council approved the recommendation of Law Committee. Agenda ....
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....financial decision could be left to the Chairman of GSTN who is also Secretary. The agenda item was unanimously approved by the Council. Agenda Item 4(iii): Status of Establishing Multiple Invoice Registration Portals (IRPs) to cater to the requirement of extending e-invoicing to all the Businesses. 8.3 The CEO, GSTN informed that Council had given permission to induct 4-5 Members from private sector for the Invoice Registration Portal (IRP) for e-invoicing and that the selection process for which had already been completed. He further proposed to bring one more Invoice Registration Portal (IRP) of NIC. NIC was already running one Invoice Registration Portal. He further submitted that in the next six months, total six Invoice Registration Portals (IRPs) would be active and proper implementation of the same with multiple players would ensure that entire B2B invoicing space gets digitized. This would lead to instant reporting of transactions as IRP captures all the information of the invoice. Further, GSTN was developing a facility so that the details of e-invoice can be shared both with buyers and suppliers instantly. The facility of IRP would make the details of invoice av....
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....y, TRU started the discussion with item No.6. He stated that there was a request for limited period exemption from IGST for defense items imported by the private vendors, since the procurement by Government for defense and defense PSUs were also exempt. He explained that this was a very small list of specified items and this exemption would be only for a period of five years lapsing in 2024. He clarified that this is an end use- based exemption where Joint Secretary from Ministry Of Defense certifies that these imports are for defense forces and they fall under the specified list. The Council agreed with the proposal to change the applicable rate of IGST to NIL on specified defense items imported by private entities/vendors when end user is the Defense forces. 10.3 He further stated that item number 9 is about increasing GST rate from 12% to 18% on Tetra Pak. He explained that all packaging material falling under corresponding chapter are liable to GST @ 18%. Therefore, Tetra Pak as compared to other packaging material was an outlier and also merits the standard rate. Because of its inputs' nature and consequences to environment, Fitment Committee opined that GST on Tetra....
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.... orthopedic implants and he requested to extend the exemption to cochlear implant (Artificial electronic ear) as this was a device for helping the hearing disabled. Joint Secretary, TRU informed the Council that cochlear implant was already at the concessional rate. The Fitment Committee had taken up items where there was a confusion between 5% and 12% and had recommended deserving items to be taken to 5%. 10.10 Hon'ble Member from Madhya Pradesh agreed with the proposal to reduce the tax rate on ostomy items used regularly in the medical field to 5% and also on all items under Orthopedic implants (CTH 9021, except hearing aids which attract NIL GST rate) which were important for assisting the handicapped. He further stated that the Fitment Committee on item number 5 of the agenda, under Chapter 23 had suggested a tax rate of 5% for items like cattle feed, cottonseed oil cake, rice bran oil etc. He informed the Council that the animal husbandry is done on a large scale in the state of Madhya Pradesh. In the 20th national count of the cattle done in 2019, Madhya Pradesh stood at 3rd place in the whole country. He stated that increasing the rate on cattle feed would burden the....
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....10.13 He further stated that the other issue involved is of reverse charge on scrap. There is significant evasion in scrap and scrap traders vanish without paying the taxes on the tax invoice. The manufacturers complain that they are suffering on this account that their suppliers were not paying the tax and corresponding ITC became ineligible. So they requested for the reverse charge mechanism on scrap. On this matter, the Fitment Committee was of the view that the reverse charge mechanism was not possible. Reverse charge could apply only at the beginning of supply chain. However, it was suggested that a meeting with the industry could be held for the issue requires re-examination. After the 45th Council meeting, the Fitment Committee examined this issue in great length over three meetings. The trade submitted that if Reverse Charge Mechanism (RCM) is there, they would be able to take the credit and it would not create any additional obligation if suppliers were not filing GST return. So, they would be absolved of any liability that may arise on account of non- payment of taxes by the scrap dealer. However, Fitment Committee examined the issue and found that scrap entailed a supply....
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....d that this issue was pending for the last five years and leading to large amount of tax evasion. He exhorted to the Council to give a serious thought for the reverse charge mechanism so that the tax evasions on scrap could be checked. 10.15 The representative from Punjab informed that their Vidhan Sabha budget session was ongoing. Thus, the Hon'ble Member from Punjab would be joining later. He stated that tax evasion on scrap was a major issue in the state of Punjab because they had a huge scrap market at a place called Mandi Gobindgarh. They referred to the minutes Of the 45di meeting of the Council, where the Hon'ble Chairperson had stated that this issue could be taken up at the next meeting after due consultation. He further stated that they were not part of the Fitment Committee and neither they nor the industry had been consulted on the issue. So, the position of the Punjab is that if this issue of reverse charge could be deferred now and only after due consultation this issue may be decided. 10.16 The Secretary informed that previous day, he had a small meeting with all his officers and he was told that the industry had been consulted and even representatives ....
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.... Sikkim who share borders with either Nepal or Bhutan, to offer their comments as they were going to be directly impacted by these recommendations. 10.19 Hon'ble Member from Uttar Pradesh submitted that they did not have any issue with the transit of cargo and the empty containers coming back but he raised the point to ensure the genuineness of such cargo through proper verification. 10.20 Hon'ble Member from Bihar also agreed to the concerns of the U.P. 10.21 Hon'ble Member from Tamil Nadu stated that the concerns of neighbouring states with Nepal and Bhutan, should be fully addressed before implementing this rather than taking the risk. He submitted that the mechanism could be in the form of a SOP which explained the process and procedures involved for the ease of comprehension. 10.22 The Secretary noted the comments of the Hon'ble Members and informed that concerned states would be informed of the SOP followed by Customs. 10.23 Joint Secretary, TRU proceeded with item number 11 pertaining to Goods Transport Agency (GTA) services and informed that the previous day some issues were raised about Goods Transport Agency services. It currently attracted ....
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....pplied in various kinds of situations leading to unwarranted litigation. Even if some damages were to be paid for breach of contract or an employee, who was under bond and left a company on payment of bond amount, Show Cause Notices for the recovery of tax on damages and notice pay had been issued. 10.25 The issues arising out of taxation of activities by way of "agreeing to the obligation to refrain from an act or to tolerate an act or a situation, or to do an act" were deliberated in detail. It was felt that the entry was being very widely and at times erroneously interpreted. Fitment Committee recommended that the issues involved may be clarified by way of the enclosed draft circular. The draft circular is based on the basic principles of GST law, Indian and international jurisprudence and international VAT/GST guidelines and practices. 10.26 Joint Secretary, TRU discussed the agenda regarding the items on Annexure IVA relating to tour and hospitality sector. The Hon'ble Member from Delhi queried regarding liability of GST by an employer hiring a vehicle for the employees as to whether it would be under Reverse Charge Mechanism or otherwise. If a company hired the vehi....
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....il agreed with the proposal for charging GST only on domestic component in the manner as presented by the Fitment. The third issue was specifically related to Andaman and Nicobar Islands where the travel between two islands by vessel was exempt if it was by public transport other than predominantly for tourism purpose. Fitment Committee agreed that transport by vessels is a mode of transport rather than a luxury and approved the proposed clarification. 10.28 Hon'ble Member from Karnataka praised the margin scheme as this would give a boost to tourism but stated there were other businesses which were claiming to be categorised under marginal scheme. So the margin scheme should be very carefully drafted; otherwise, undeserving businesses would get benefited by such a margin scheme. 10.29 Hon'ble Member from Delhi agreed with the view of the Hon'ble Chief Minister from Karnataka and asked the Council some time to further study and examine the margin scheme before concluding it since only in- principle approval had been sought on this. 10.30 Hon'ble Member from Kerala raised the point that destination-based billing concept should not be diluted. 10.31 Hon....
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....ill lead to huge expenditure to Exchequer. Most of the States were very heavily burdened by pensions and were unable to hire at the level that they used to do in the past. Tamil Nadu had also given Joint Secretary, TRU a paper stating that the local bodies provided services to citizens where there is no question of abuse as it is a public entity and subject to audit and scrutiny. GST on services or composite goods and services purchased by local bodies would be a huge burden on them and effectively on the State who finances these local bodies. 10.35 Hon'ble Member from Uttar Pradesh stated that such public services should be exempted, while commercial activity should be charged to tax. He suggested to bring cattle ponds into exempted list and added that the electric vehicles in urban areas should also be brought under exemption. 10.36 Hon'ble Member from West Bengal put forth that she agreed with Hon'ble Ministers because these pure service items were large in number and now it had been reduced to only 6. Further, this move would be a burden on exchequer as these services were provided by local bodies funded by the government. 10.37 Hon'ble Member from Hary....
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....ourism but crucial for normal transport. It was not luxury but necessity in a hilly state like Himachal Pradesh. Therefore, he requested the Council that the ropeway transport should be kept at 5% tax rate with ITC of input services. He further informed that Solar projects were at 5% GST while Hydro Projects were 18% GST thus making them unviable due to higher costs. He requested the Council to bring hydro projects to 5% GST rate. The Council approved the 5% GST rate on transport of goods and passengers by ropeway with ITC of input services. The Council agreed with all other items in Annexure IV, V and VI to the Agenda item No.6 and recommended accordingly. Agenda item 7: Agenda note on C-PACE Project for Ease of Doing Business in India 11.In respect of agenda note on C-PACE Project for Ease of Doing Business in India, it was stated by the Secretary that the Ministry of Corporate Affairs was planning to launch a Centre for Accelerated Exit as a part Of Ease Of Doing Business for which they had requirement of Nodal Officers from the Department of Revenue and that two Officers were being nominated for this purpose for which approval was being sought from the Council who w....
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....akh and the States could decide any amount abov that amount as a minimum threshold and for filling up the e-way bill forms, only part-A the e-Way bill would be required without any need for filling part-B of the e-Way bill ti ensure security of transportation. 13.3 The Hon'ble Convenor further explained that the reasons of suggesting e-way bill wa to enable the officials of field formation in the city to identify whether the gold bein transported was inter-state or intra-state. Further, the GOM suggested that the E-invoicing:should be made mandatory for B2B transactions by all taxpayers supplying gold/precious stones (goods of HSN 71) and having annual aggregate turnover above Rs.20 Crore. Further the issue of levy on GST on reverse charge mechanism (RCM) basis on purchase of old gold by registered dealers/jewellers from unregistered persons may be referred to Fitmen Committee for detailed examinations. 13.4 The Secretary invited comments from Bihar, West Bengal, Gujarat and Punjab were the other Members and further stated that it was being left to the States to implement tlu e-way bill and its threshold limit and only part-A of the e-way bill would be implemented. T....
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....GST Act, 2017 15. The Secretary introduced Agenda item 11 which was a note on amendments to provisions relating to GSTAT in CGST Act, 2017. He stated that the Courts, the Standing Committee on Finance and other Committees had emphasised the need to set up the Tribunals. In the absence of Tribunals, people were being forced to file Writ Petitions and a number of cases had been decided by the High Courts and by the Hon'ble Supreme Court in place of Tribunals. He further informed that since the GST Tribunals would decide on matters pertaining to CGST, SGST and IGST which would affect the States and Centre and therefore, parity had to be maintained in the membership between States and Centre. The Secretary informed that that process would still take time because the Act needed to be amended and then the Rules were to be formulated and the process Of selection of Members would take place. He invited JS DoR to make a presentation. 15.1 Joint Secretary, DOR gave a presentation before the Council which is attached as Annexure-5. 15.2 Hon'ble Member from Uttar Pradesh submitted that there should be a time bound exercise and they would proceed accordingly. 15.3 Hon'bl....
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....that State is being considered, i. Section 110(5A): Instead of recommendations of Panel of two names for one post of Technical Members, the ScSC should recommend only one name for one post of Technical Members, j.Section 110(9): There should be no reappointment of Technical members, the reason being that it would not give enough opportunity to others. Moreover, tenure period of 4-year as a Technical Member is fairly long period. 15.4 Hon'ble Member from Tamil Nadu recommended for constitution of a Group of Minister (GoM) to address the issues where legal, council and executive functions are blurred, within a time frame of 2 to 3 months and GoM could come back with a design which keeps the making of the Council in sight. That the Council represented the elective Members and the Council should not just do that because the court had ordered. 15.5 Hon'ble Member from Gujarat submitted that as the issue was long pending for the last five years, the fomation of GSTAT should be taken up on priority. There must be State level Tribunal with High Court Judge, The Member further elaborated that right now the proposition was for the constitution of a National Tr....
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.... from the Hon'ble Finance Minister in specific cases for exemption and were brought before the Council for approval. The same were unanimously approved by the Council. Agenda item 13: Recommendations of the 16th IT Grievance Redressal Committee for approval/decision of the GST Council 17. The Secretary asked the Joint Secretary, GST Council Secretariat to present the agenda item 13 regarding recommendations of the 16th IT Grievance Redressal Committee before the Council. The Joint Secretary presented the agenda before the Council . 17.1 The 16th meeting of the IT Grievance Redressal Committee (ITGRC) discussed the following cases - 17.1.1 Four cases of TRAN-I/TRAN-2 filing forwarded by Nodal Officer: The Committee recommended that out of the four (04) cases forwarded by the Nodal officers, the committee did not consider two cases on merit as these were received by the GSTN after the due date i.e. 31.08.2020 and recommended for rejection as being time barred. The committee rejected the third case on merit and decided not to consider any case forwarded by the Nodal officers to GSTN after the due date i.e. 31.08.2020. The fourth case was recommended by the committee to....
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....ef Minister of Karnataka and the Convenor of the GoM on Rate Rationalisation to present the Agenda item for further detailed discussion by the GST Council. 18.1 Presenting the Agenda Item, the Hon'ble Chief Minister of Karnataka and Convenor of GoM in his opening remarks stated that the GoM was entrusted to give its report on rate rationalization. He stated that the GST Revenue collection had fallen during successive COVID waves in year 2020 & 2021. This necessitated the need to take steps to augment GST Revenue so that additional mobilization of resources can be ensured. The GST Council in its 45th Meeting held on 17 September, 2021, at Lucknow decided to form a Group of Ministers to look into matters related to rate rationalization including reviewing the exemptions, tax slabs, tax slab structures and correction of inverted duty structure to enhance GST revenue. 18.2 He further stated that States of Karnataka, Goa, Kerala, Rajasthan, Uttar Pradesh, Bihar and West Bengal being the Members of the GoM had actively participated and given their views on relevant subjects. Subsequently, after 46 GST Council Meeting, the GoM was asked to look into the issues of textile s....
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....urther stated that on the issue of works contract services, the GOM observed that there was a need to correct the inverted duty structure, however, the increase of six percent GST rate on works contract services provided to the Government may strain on the budget of the States and the GST Council might take a final view on that issue considering that present rate structure in works contract is causing inverted duty structure and has compliance issues. On the issue of review of exemptions, he stated that exemptions on goods and services also led to disruption of credit chain and blockage of ITC and therefore all the exemptions under GST were examined by the GOM; that exemption on a few items which had consumer sensitivity viz. bread , tea, coffee, poultry feed etc. were retained; that certain exemptions on goods and services had been suggested to be rationalized and the proposed rate on such goods would be the same as applies to the respective HSN code; that one of the majority category of exemptions reviewed was exemption on unbranded food items including cereals. Currently, only branded food items attracted tax and revenue from those items had fallen as compared to the pre- GST re....
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....e Member from Goa thanked the Convenor of the GoM and all members. Supporting the proposal given by the Hon'ble Member from Delhi, he stated that the GoM had given such a good report after due deliberations on the inputs received from the Members, Fitment Committee, officers and that it may not be prudent to discuss each item as the discussion might turn State specific rather than being focused on revenue. He mentioned that considering all the aspects, the interim report as proposed would help in correcting inversion in rates, rationalisation of exemption and also augmentation of revenue, though the GoM needed more time to analyse how much increase in revenue would be there. He then requested the Council to accept the interim report as suggested by GoM. 18.9 The officer from Bihar on behalf of the Hon'ble Member stated that Bihar agreed with the report and also supported the proposal of increasing the rate on works contract services provided to the Government from 12% to 18% but as it may have an additional financial burden on the State exchequer, therefore she requested that proposal might be implemented in a staggered manner. 18.10 Hon'ble Member from Tami Nadu ....
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....hich they provided to their employees. The Hon'ble Member from Haryana explained further that Gurgaon had a very big market of renting of houses and a company might take many houses on rent for its employees out of which a few might have higher rent and a few others might have less and further suggested that a capping might be done on the rent amount to be taxable. The Hon'ble Member from Karnataka again reiterated that only the service of renting of residential dwelling for residential use [when supplied to business] was made taxable and renting to the general public for residential purpose was exempted, however, the issue of capping on the rent might be deliberated further. 18.15 The Joint Secretary, TRU explained that there was a threshold exemption for services also and the objective to exempt residential dwelling was to exempt the rent paid by the individuals or non- commercial person as there should not be any tax burden on him. He further stated that corporates were taking a number of other services for their employees also and were paying tax on the same. There was no such differentiation there. 18.16 Hon'ble Member from Tamil Nadu stated that after this m....
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....decided to call suggestions from all the States. All the suggestions were classified into certain groups and based on all these recommendations, sixteen broad suggestions were identified to be taken up on case to case basis and out of these, six to seven suggestions were identified for implementation. 19.2 The first issue on the subject was regarding the new registration and the biometric authentication, second issue was to study the profile of new registrants from the system and compulsory physical verification of these registrations, third was to check the existing tax payers whether they were doing fake invoicing or not with the help of the system and take them up for physical verification. Fourth item was regarding the Geo-coding of addresses. It was observed that while seeking new registrations many tax payers were giving non existing addresses/ false addresses. GSTN is proposing to make arrangements to fetch the meta data from the application such as addresses and make it available to tax administration to verify online from the relevant utility website. The fifth item was to capture the electricity bill data. Currently at the time of registration, many users were using th....
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....istration process. There was lot of information which was there in the State data bases which was not currently linked with the GSTN like registration data base, electricity data base or RTO data etc. All these data bases provide a lot of cursive data which could be linked to the GSTN system and used to do analytics. Many tax payers were submitting electricity bill as proof of address but by tampering with the name and that could not be identified because that data was not captured in the system per se in the form of information. One pilot was being proposed by Maharashtra. All those electricity bill data would be captured at the time of filling the registration application and then states would be speaking with the data bases of the utility companies and would be verifying those electricity numbers. Once those numbers were sorted out, that would be easy to figure out which applicants had been furnishing false data in the electricity bills. 19.8 The second last item was about the use of incorrect bank accounts at the time of registration. It was observed in almost all the States that many of the bank accounts filled at the time of registration were incorrect in the sense that th....
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....s 25000/ from Rs 50000/ and compulsory e-invoicing to be reduced from the existing Rs.20 crore. The Hon'ble Member further proposed that it may be examined if meter reading could also be recorded in E-way bills to avoid round tripping. 19.14 The Secretary clarified that the Law Committee had discussed the issue but did not agree upon it as that would be too intrusive and the taxpayer's reaction also had to be kept in mind while taking such a decision. Further, he added that reducing the limit of e-invoicing is being done continuously and regarding limit of Rs.25000/- for E-way bill would be very small. 19.15 The Member from Tamil Nadu stated that the GoM needed to meet more in person actively and on regular basis. The GoM also should meet the GSTN more frequently as a lot more could be done on the systems. 19.16 The Deputy Chief Minister of Delhi spoke about sharing the fast tag integration data. The Secretary stated that regarding fast tag integration, they had an App and requested the Member from GSTN to explain the App. 19.17 The representative from GSTN stated that for fast tag integration, NIC had done some work and an App had been given to the officers whe....
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.... done as per the direction of Law Committee and that there were some issues related to jurisdiction. That they would put the proposal of Hon'bIe Member from Uttar Pradesh before the Law Committee as to how much information pertaining to the tax payer in respect of e-waybill could be shared between different States. That GSTN was only an implementing agency and whatever decision was taken by the Law Committee would be implemented by GSTN. 19.24 The representative from Tamil Nadu stated that since every transaction was being registered in the GSTN portal, why should the data not be available to the States for cross referencing and matching. 19.25 On this, the Chairperson stated that Tamil Nadu and Uttar Pradesh had given the logic for sharing the data and if any State could give any logic for not sharing the data. That since no State had come up with any objection, the chairperson asked GSTN to look towards sharing, 19.26 The Secretary observed that since the Law Committee was subordinate to the Council, they would take it as a Council decision. 19.27 The representative from GSTN stated that he would start with integrating e-waybill data sharing and as they moved alon....
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....because of the complexity of the issues and finally on February, 2022 the GoM was reconstituted. 20.2 He further stated that the GoM had looked into three major aspects. • First was the rate, what rate should be applied to these three different sectors whether that should be 18% or 28%. • The second issue was whether GST should be charged on the commission that was charged by the organizers or should that be charged on the entire value of the stakes. • Third issue was regarding Casino which was a very different game and a form of betting with multiple factors. That in Casino, the different activities such as entry fee, fees on the food that one ate inside, the fees on the chips that one bought and even the transportation of the players were having different aspects, and the GoM had to deliberate as to how to tax these different activities within the overall casino activity. Further online gaming, horse racing and casino were three very different activities though all had a sense of betting and gambling but the way they were run was very different. That GoM needed to find some uniformity in the rates and valuation while understanding each of....
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....s regarding improvement of the infrastructure, the technology, the data capture and identification models to bring the betting into the light and avoid the likelihood of its moving into a grey or black market. He further stated that all the Members sought to maximize revenue while reducing those types of activities and having compliance to law. That it may not be relatively exorbitant and there was still some scope of review. 20.8 Hon 'ble Minister from West Bengal submitted that Rule 31A had already been upheld by the Hon'ble Supreme Court. Two judgments were presented by Hon'ble Chief Minister of Meghalaya i.e. one of M/s Sunrise Associates and other of M/s Skill Lotto; that the Hon'ble Supreme Court had held that these three activities are actionable claims which could be taxed under GST. Therefore, if they took into consideration the Skill Lotto case, they could not fix separate system, the principle of valuation or rates for separate games having different actionable claims. Further, right to participate and right to win were not separable; that was what Supreme Court had said in M/S Sunrise Associates case, so while deciding the issues, that principle had t....
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....;ble Member from Uttar Pradesh agreed with the Chief Minister, Goa that the nature of all three activities were different and should not be clubbed together and he welcomed Hon'ble Chairperson's suggestion to reopen the discussion on Casino. 20.12 Hon'ble Member from Tamil Nadu stated that there are some profound issues such as enforcement and movement of the activities into the grey market. The identification of locus is easy in casino, hard in racing, least in online gaming. That all the three games had that risk. He further submitted that if the GoM had already submitted a report, like in the earlier case of rate rationalization, either the Council should look into it entirely all over again or not at all. That there were bigger issues there but if the GoM was to reopen, that should not be opened for just one of the three industries rather it should be opened for all the three industries. 20.13 Hon'ble Member from Delhi appreciated the Chairperson for giving a window to GoM to re-examine on limited issue as raised by Goa regarding casino. He stated that gambling, betting and even liquor were some of the necessary evils and on the one hand, the society wante....
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....hat Telangana had horse racing and the taxation as per the recommendations of the GoM would definitely lead to the closure of industry or that would lead to illegal activity. That in the broader interest, let all the three issues be re-examined. Hon'ble Chairperson then asked Telangana to submit papers on that to the GoM. 20.17 Hon'ble Member from Karnataka stated that in principle, he agreed with the recommendations of the GoM. That enforcement and implementation part were crucial and that let the Law Committee in consultation with enforcement department, including state enforcement department, come out with the roadmap. 20.18 Hon'ble Member from Gujarat suggested that place of supply in case of online services was very important issue and that the address of recipient on record was the key issue, so committee of officers might look into that as that was very important for taxation purpose. The Chairperson directed Chairman CBIC to sort out the issue. 20.19 Hon'ble Member from Haryana stated that he totally agreed with what Hon'ble Chief Minister of Karnataka had said. As regards place of supply he stated that either the address had to be the permanent....
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....evenue loss was Rs 120 Crores every year, Paytm, it was Rs. 125 Crores and ICICI Bank, it was 85 crores in the last four years. The issue was brought to the notice of the Council which allowed negative reporting in the monthly return (GSTR-3B) to help in stopping the revenue leakage/loss and requested to allow the same in the new return format also. However, that was prospective and that request was to recover retrospective revenue loss and sought the help of certain states such as Maharashtra, Karnataka, Delhi and Andhra Pradesh as there is no specific mechanism to recover old dues. 21.2 The Secretary told that that was a tricky issue and the taxpayer should not be unnecessarily burdened, however, Hon'ble Member from Telangana clarified that taxpayer would be given refund but Telangana needs help from the concerned states. The Secretary assured that the officers of the concerned states such as Telangana, Andhra Pradesh, Maharashtra and Karnataka collectively would see what best solution could be provided to the issue. 22. General Discussion on Compensation 22.1 Hon'ble Member from Punjab stated that Punjab was an agrarian State and all the taxes had got subsumed i....
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....AG Certificate and that Rajasthan had not submitted the AG certificate. On submission of such a certificate, the dues would be paid immediately. 22.7 Hon'ble Member from Delhi stated that their financial situation has been strained due to the Covid Pandemic and hence, it would be desirable to extend the compensation for another five years. The restructuring Of loans should also be taken to facilitate the continuation of compensation. He further stated that decisions regarding the enhancement of tax rates should be implemented immediately. 22.8 Hon'ble Member from Uttarakhand stated that the extension of the compensation would be in interest of the State. 22.9 Hon'ble Member from Kerala stated that compensation may be extended for a further period due to financial position of the States. He also stated that the ratio of Centre and State should be changed from 50:50 to 40:60 in favor of the States. 22.10 Hon'ble Member from Goa stated that the out of the box plan of loan scheme helped the States. He further Stated that theirs being a small State, it did not have many avenues to increase the revenue. 22.11 Hon'ble Member from West Bengal also request....
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....h the baseline of 2015-16. However, Covid had played spoiler to the original plan. He further stated that there was a significant short fall in GST revenue as well as in the compensation pool. He thanked the chair for the innovative idea of compensating the States in the form of loan during Covid period. He said that the gap between the protected revenue and the actual revenue had increased and if compensation was stopped, that would lead to huge resource crunch and requested the GST Council to extend compensation for another five years. 22.15 The Hon'ble Member from Puducherry stated that Puducherry was having the highest gap between the protected revenue and the actual revenue. He stated that finances of the State were affected not only due to Covid but also due to other State specific reasons. He gave certain statistics of revenue gap and stated that Puducherry had yet to finalize the budget for want of compensation. He requested to continue compensation for another five years from the year 2022. 22.16 Hon'ble Member from Uttar Pradesh stated that introduction of GST had worked well and that their State had taken steps to control the expenses but the Covid had spoi....
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....resentations of their recommendations and had travelled to Chandigarh despite their very busy schedule. The GoM on Casinos, race courses and online gaming would also have a look at the issue of taxation of online gaming, casinos and horse racing once again and give the report in the next 15 days. Jn this meeting, it was also decided to set up a GoM on the issue of constitution of Tribunals and if the GoM could also submit its report by the end of the month, the next Council meeting would be held in the first week of August on these two items alone so that these important decisions could be taken. 23.1 The Secretary also thanked the administrations of UT Chandigarh, Haryana and Punjab for hosting the Council meeting at a very short notice. He also thanked all the Union Finance Minister, the MoS, the Members of the Council, and all the officers who had come from States and Centre and the officers from Secretariat who had been working overtime to ensure that GST council meeting was successfully conducted. ============= Document 1 Shipra MINUTE BOOK Annexures to the Draft Minutes of The 47th Meeting of GST Council Annexure-1 List of Hon'ble Ministers from States/UTs....
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....Aviation and Commerce & Industries 23 Tamil Nadu Dr. Palanivel ThiagaRajan Minister for Finance and Human Resources Management 24 Telangana Shri T Harish Rao Minister for Finance, Medical and Health 25 Tripura Shri Jishnu Dev Varma Deputy Chief Minister Page 74 of 155 Shipra Shipra MINUTE BOOK 26 Uttarakhand Shri Prem Chand Aggarwal Minister of Finance, Urban Development, Housing, Legislative & Parliamentary Affairs, Re- organisation and Census 27 Uttar Pradesh Shri Suresh Kumar Khanna Minister of Finance, Parliamentary Affairs Minsiter of State (Independent 28 West Bengal Smt. Chandrima Bhattacharya Charge), Finance Department Page 75 of 155 CHAIRMAN'S INITIALS Document 2 N CHAIRMAN'S INITIALS MINUTE BOOK Annexure-2 List of the Officers from the Centre and the States/Union Territories attending the 47th GST Council Meeting on 28-29 June 2022 S. No Centre/ State/UTS Name of the Officer Designation/Charge 1 Govt. of India Shri Tarun Bajaj Revenue Secretary 2 Govt. of India Shri Vivek Johri Chairman, CBIC 3 ....
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.... Ms. B. Sumidaa Devi Director 33 GST Council Secretariat Shri Kshitendra Verma Director 34 GST Council Secretariat Shri Harish Kumar Deputy Secretarty 35 GST Council Secretariat Shri S. S. Shardool Deputy Secretarty 36 GST Council Secretariat Ms. Reshma R Kurup Under Secretary 37 GST Council Secretariat Shri Joginder Singh Mor Under Secretary 38 GST Council Secretariat Shri Manish Wadhwa Superintendent 39 GST Council Secretariat Shri Manoj Kumar Superintendent 40 40 GST Council Secretariat Shri Sachin Goel Superintendent 41 GST Council Secretariat Ms. Priya Sethi Page 78 of 155 Superintendent Shipra Shipra MINUTE BOOK 42 GST Council Secretariat Shri Rakesh Joshi Inspector 43 GST Council Secretariat Shri Vijay Malik Inspector 44 GST Council Secretariat Shri Tarun 45 GST Council Secretariat Shri Padam Singh Assistant Section Officer Inspector 46 Andaman & Nicobar Shri Kuldip Singh Thakur Special Resident Commissioner 47 Andhra Pradesh Shri Gulzar. N Secretary to Government (RM & FP) & (CT)....
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....3 Haryana Shri Simarpal Singh Special Secretary to Deputy CM 74 Haryana Shri Anurag Rastogi 75 75 Haryana Shri Shekhar Vidyarthi Addl. Chief Secretary to Government of Haryana, Excise and Taxation Department Excise & Taxation Commissioner-cum- Secretary to Government, Haryana 76 Haryana Shri Siddarth Jain Additional Commissioner Page 81 of 155 24 CHAIRMAN'S INITIALS لله CHAIRMAN'S INITIALS MINUTE BOOK 77 Himachal Pradesh Shri Subhasish Panda Principal Secretary (STE) 78 Himachal Pradesh Shri Yunus 79 Himachal Pradesh Shri Rakesh Sharma 80 Jammu & Kashmir Shri Vivek Bharadwaj Commissioner of State Taxes & Excise Advisor to the Hon'ble Member( Additional Commissioner) Additional Chief Secretary, Finance Department, Government of J&K Commissioner State Taxes Department, 81 Jammu & Kashmir Dr.Rashmi Singh J&K 82 Jharkhand Smt. Aradhana Patnaik 83 Jharkhand Shri Santosh Kumar Vatsa 84 Karnataka Shri Manjunath Prasad Secretary, Commercial Taxes Department Commissioner, Commercial Taxes Department....
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....Shri. B. Balamourthy Asst. CTO, Commercial Taxes Department, Puducherry 113 Punjab Shri KAP Sinha Additional Chief Secretary (Taxation) 114 Punjab Shri Kamal Kishor Yadav Commissioner of State Taxes 115 Punjab Sh. Ravneet Singh Khurana Additional Commissioner of State Taxes (Audit) Page 84 of 155 Shipra Shipra 1 MINUTE BOOK 116 Rajasthan Dr. Ravi Kumar Surpur Chief Commissioner, State Tax 117 Rajasthan Shri Arvind Mishra Additional Commissioner, State Tax 118 Rajasthan Shri Ashok Agarwal PA/PS to Minister 119 Sikkim Shri Manoj Rai Commissioner, Commercial Taxes 120 Sikkim Shri Keshab Subba Joint Commissioner, Commercial Taxes 121 121 Tamil Nadu Shri N. Muruganandama 122 Tamil Nadu Shri Dheeraj Kumar 123 123 Additional Chief Secretary, Finance Principal Secretary/Commissioner of Commercial Taxes Tamil Nadu Shri S. Subhash Chandra Bose Joint Commissioner 124 Telangana Shri K Ramakrishna Rao Special Chief Secretary, Finance 125 Telangana Smt. Neetu Prasad Commissioner, Commercial Taxes 126 Telangana ....
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....1 to 28.02.2012: to implement e-invoicing for the taxpayers having aggregate turnover exceeding Rs. 20 Cr from 1st April 2022; to extend the due date of filing FORM GSTR-3B for the month of April, 2022: to extend the due date of payment of tax. in FORM GST PMT-06. for the month of April. 2022 by taxpayers who are under QRMP scheme: to waive off late fee under section 47 for the period from 01.05.2022 till 30.06.2022 for delay in filing FORM GSTR-4 for FY 2021-22: to notify CGST rates of various services as recommended by GST Council in its 45th meeting held on 17.09.2021: viii. to exempt CGST on specified medicines used in COVID-19, up to 31st December. 2021: to implement special composition scheme for Brick Kilns, as recommended by GSTC in 45th meeting ETGST Act. Two (2) Union Territory Tax Notifications issued (No. 01/2022 to 02/2022) and nineteen (19) Union Notifications to implement of various decisions of 45th meeting of GST Council & to implement other Territory Tax (rate) GIC decisions. Notifications issued (No. 06/2021 to 22/2021 and 01/2022 to 02/2022) Agenda 2: Ratification of Notifications, Circulars, Orde....
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....tainable in law as it bars refund of inutilized ITC on account of inverted rated structure when the petitioner has supplied goods at concessional rate under the Concessional Notification of the Goverment of India: Such cases are covered under section 54(3)(ii). whereas para 3.2 of impugned circular bars it. LC has recommended to clarify through a circular that: the refund of accumulated input tax credit on account of inverted structure as per clause (ii) of first proviso to sub-section (3) of section 54 of the CGST Act is admissible in cases where though input and output goods are same, but the accumulation of input tax credit is on account of rate of tax on inputs being higher than the rate of tax on output supplies (at the same time) due to a concessional notification issued by the Government. o other than cases where output supply is either Nil rated or fully exempted; and o also provided that supply of such goods or services are not notified by the Government for their exclusion from refund of accumulated ITC under said clause. This would provide clarity to the trade and field formations and would reduce litigation on the issue. Agenda ....
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....nd input services during the said tax period and to use this objective criteria to revise the formula prescribed in rule 89(5) as suggested by Hon'ble SC. ■Accordingly. LC has recommended the following amendment in formula prescribed in rule 89(5): Maximum Refund Amount = {(Turnover of Inverted rated supply of goods and services) x Net ITC + Adjusted Total Turnover} - (tax payable on such inverted rated supply of goods and services x (Net ITC+ ITC availed on inputs and input services)}. This would bring more objectivity to the formula for calculation of refund of ITC on account of inverted duty structure. Agenda 3(VI): Issuance of clarification on various issues pertaining to GST (1/3) [Vol 1- Pg. 176-184] Issue 1: ܀ Circular No. 147/03/2021-GST dated 12.03.2021. vide which the para 41 of Circular No. 125/44/2019-GST dated 18.11.2019 was amended, provides to remove the restriction from availing the ITC of the tax paid on the deemed export supply by the recipient when the refund of tax paid on such deemed export is claimed by the recipient. The said restriction was removed in order to enable the recipient of the deemed ex....
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....availment of ITC on input services by way of leasing of motor vehicles, vessels or aircraft or whether ITC on input services by way of any type of leasing is barred under the said provisions. Proposal: LC has recommended to clarify through a circular that- â– Proviso after sub-clause (iii) of section 17(5)(b) of CGST Act is applicable for all sub- clauses (i), (ii) & (iii) of section 17(5)(b); â– "Leasing" referred in sub-clause (i) of clause (b) of sub-section (5) of section 17 refers to leasing of motor vehicles, vessels and aircrafts only and not to leasing of any other items; Agenda 3(VI): Issuance of clarification on various issues pertaining to GST [Vol 1- Pg. 176-184] (3/3) Issue 3: Doubts have also been raised regarding the taxability of various perquisites provided by the employer to its employees in terms of contractual agreement entered into between the employer and the employee. Proposal: LC Recommendation: Issue 4: The issue may be clarified through a circular, on the lines of earlier clarification made through Press Release dated 10.7.2017. i.e. supply by the employer to the employee in terms of c....
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....23(2) of the CGST Act, subject to conditions that- â– The exemption is available upto aggregate turnover on all India basis not exceeding the turnover specified under sub-section (1) of section 22 of the CGST Act and notifications issued thereunder. âš« They shall not make any inter-State taxable supply: â– They would be mandatorily required to declare their Permanent Account Number (PAN) and Principal place of business. â– For each PAN, such unregistered person shall be restricted to declare principal place of business in only One State. âš« The ECO would be required to - âš« declare the supplies made by unregistered persons through them through GSTR-8 statement (by inserting a suitable table in it). to ensure that no inter-State supply through them is allowed in respect of such unregistered persons by making necessary checks and validations on their system/platform; failing which the penalty would be imposable on the ECO. ECO will not be required to deduct any TCS in respect of such supplies made by unregistered persons through them. Page 93 of 155 CHAIRMAN'S INITIALS å°‘ CHAIRMAN'S INITIAL....
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....ng bill bill of export for claiming refund of unutilised ITC in respect of export of goods, which is causing difficulty in claiming such refunds. LC has recommended: âš«to make amendment in Rule 89(2) of the CGST Rules, 2017 to provide for a new statement for claiming refund of unutilised ITC on account of export of electricity, and âš«to issue a circular prescribing SOP for refund of unutilised ITC on account of export of electricity till system related changes are carried out on portal. This would facilitate the exporters of electricity in claiming refund of utilised ITC on zero rated supplies. Page 94 of 155 Shipra Shipra MINUTE BOOK Agenda 3(IV): Clarification on various issues relating to applicability of demand and penalty provisions under the Central Goods and Services Tax Act, 2017 in respect of transactions involving fake invoices [Vol 1-Pg. 166-170] Issue: There appears to be lack of clarity in respect of various issues pertaining to demand of tax and for penal provisions in cases involving issuance of tax invoices without underlying supply of goods or services, and/ or availment of ITC in respect of such f....
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....tified by the Centre and the States/ UTs. The proposal will remove ambiguities regarding levy of interest on wrongly availed ITC and will also provide for transfer of balance in CGST and IGST cash ledgers between distinct persons, thereby improving liquidity and cash flows of such taxpayers. Page 95 of 155 CHAIRMAN'S INITIALS SV CHAIRMAN'S INITIALS MINUTE BOOK Agenda 3(XIII): Re-credit of amount in electronic credit ledger through FORM GST PMT-03A Issue: • [Vol 1- Pg. 238-245] Difficulties are being faced by the taxpayers in taking re-credit of the amount in the electronic credit ledger in cases where any excess or erroneous refund sanctioned to them on account of accumulated ITC or on account of IGST paid on zero rated supply of goods or services, in contravention of rule 96(10) of the CGST Rules, 2017, had been paid back by them either on their own or on being pointed by the tax officer. The present provisions provide for re-credit of amount in electronic credit ledger only in two situations, which are rejection of refund of unutilised ITC and sanction of refund of excess payment of tax. GSTN has recently ....
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....r return in FORM GSTR-4 of subsequent tax period, such amount needs to be debited from electronic cash ledger of the concerned taxpayer. However, large number of representations were received from the taxpayers stating that due to the debit made by the system in electronic cash ledger, resulting in negative balance in the said ledger, they were suddenly facing cash crunch for paying the remaining due amount as per GSTR-4 return. The issue was deliberated by the Law Committee in its meeting held on 07.05.2022 and LC recommended that late fee under section 47 may be waived for the period 01.05.2022 till 30.06.2022 for delay in filing FORM GSTR-4 for FY 2021- 22. The said recommendation of the Law Committee was subsequently approved by the GST Implementation Committee (GIC) and implemented vide issuance of Notification No. 07/2022-GST dated 26th May, 2022. A large number of representations are still being received from the taxpayers and various trade associations regarding difficulty being caused due to negative balance in electronic cash ledger. It has also been represented that in some cases, the amount of negative liability has already been paid thr....
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....(1) of the CGST Rules, 2017. provides that Shipping Bill filed by the exporter would be deemed to be an application for refund of integrated tax paid on account of export of goods subject to filling of EGM and return in FORM GSTR-3B. Further, these IGST refunds are processed by the proper officer of customs in completely automated manner as per the provisions of rule 96(3). However, in some cases where the exporter is identified as risky exporter requiring verification by GST officers, or where there is a violation of provisions of Customs Act. the refund claims in such cases are suspended/ withheld and such refunds remain pending for processing, as the proper officer of Customs is not empowered to reject the refund. fully or partially. Proposal: LC Recommendations: To make necessary amendments in rule 96 of the CGST Rules - âš« to provide for transmission of such refunds on the portal in a system generated FORM GST RFD-01 to the jurisdictional GST authorities; and âš« to provide for such refunds to be dealt by jurisdictional GST officer in a manner similar to refunds filed in FORM GST RFD-01 to enable processing of such pending refun....
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.... [Vol 1-Pg. 223-2371 Amendment to rule 21A: At present, centralized suspension of registration is being done by the system. for non-compliance in terms of clause (b) or clause (c) of sub-section (2) of section 29, based on annual turnover (AATO>Rs 50 lakhs). To facilitate centralized suspension in such cases by the system irrespective of turnover threshold, there is a need to have provisions for automatic revocation of suspension, once all the pending retums are filed on the portal by the taxpayer. Accordingly, LC recommended amendment in sub-rule (4) of rule 21A to provide that in cases of centralized suspension of registration for non-compliance of clause (b) or clause (c) of sub-section (2) of section 29, the suspension shall be automatically revoked once all the pending returns are filed on the portal by the taxpayer. Council may also allow for centralized suspension of registration under rule 21A(2A) for non-compliance in terms of clause (b) or clause (c) of sub-section (2) of section 29. irrespective of for annual turnover (below Rs. 50 Lakh also). Amendment to Explanation 1 after rule 43: Duty Credit Scrip (DCS) are transferrable an....
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....s specified under Rule 87(3) of CGST Rules. 2017. Law Committee has recommended amendment in rule 87(3), rule 87(5), FORM PMT-06 and FORM PMT-07 so that appropriate action for implementation of new payment mode may be initiated. Page 99 of 155 7/1 CHAIRMAN'S INITIALS MINUTE BOOK Agenda 3(XII): Proposal for amendments to CGST Rules, 2017 (3/3) Amendment to rule 89: • Export Value [Vol 1-Pg. 223-237] • There is persistent confusion among the field formations regarding the meaning of the term "export value" declared in the corresponding shipping bill under the Customs Act-whether the same has to be taken as FOB value or CIF value or invoice value. " Law Committee was of the view that the term export value declared in the corresponding shipping bill under the Customs Act mentioned in the clarification issued vide para 47 of the Circular No. 125/44/2019-GST dated 18.11.2019 refers to FOB value only. Law Committee recommended that to remove any ambiguity in the matter and to ensure uniformity in processing of refunds of unutilised ITC on account of export of goods, an explanation may be inserted under rule 89(4....
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....r section 10 of the CGST Act (composition taxable persons) and UIN holders. Also, there appears to be lack of clarity regarding reporting of information about reversal of ITC as well as ineligible ITC in Table 4 of FORM GSTR-3B. Representations have also been received from States for settlement of IGST amount based on various reversals of ITC. Proposal: LC Recommendations: Issuance of a circular to explain the manner of reporting of the information about inter-state supplies to unregistered persons, UIN holders & composition taxpayers and also about reversals of ITC and ineligible ITC in Table 4 of FORM GSTR-3B, along with illustrations. âš« Settlement of reversals of ITC and ineligible ITC to be done by Department of Revenue & GSTN on the basis of Table 4(B)(1) and 4(D)(2) of FORM GSTR-3B âš«Necessary label changes may be done in FORM GSTR-3B accordingly The proposal will bring clarity and uniformity in reporting of information in return and will also help in settlement of IGST amount based on various reversals ofITC. Page 100 of 155 Shipra Shipra MINUTE BOOK Agenda 3(XI): Comprehensive changes/amendments in FORM ....
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....202] Issue: The Annual Retum in FORM GSTR 9 & Anmial Reconciliation Statement in FORM GSTR 9C were simplified for the FY 2017-18, 2018-19, 2019-20 and 2020-21 21 by making few entries/tables optional. It has been suggested that in a long run, the annual return should cover the features of proposed changes in FORM GSTR-3B. as suggested by the Law Committee and detailed in Agenda 3(XI). However, as the FY 2021-22 is over, there is demand to notify the Annual Return forms for FY 2021-22 at the earliest. A sub-committee of the Law Committee examined the relaxations provided in FY 2020-21 and has recommended modifications/ continuation / discontinuation of such relaxations based on their present relevance as detailed in the agenda note. Proposal: LC Recommendations: â– To continue with most of the relaxations as provided for FY 2020-21. barring a few detailed in agenda note, such as seeking HSN details in Table 17 of GSTR-9, as requirement of reporting HSN in invoices were changed w.e.f. 01.04.2021. AATO threshold for granting exemption from filing annual return in FORM GSTR-9/9A, which was Rs. 2 crores for FY 2020-21. may be continue....
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....payer is to be decided by the jurisdictional tax authority only. (on the issue of various consequential action) The proposal will bring clarity to the field formations about the competent authority to take an action in case of an enforcement action initiated by the Central authorities against a taxpayer assigned to State and vice versa. Agenda 3(XIV): Extension of limitation under section 168A of the CGST Act, 2017 [Vol 2-Pg. 05-06] Issue: ܀ Law Committee deliberated on the problems being faced by the taxpayers as well as tax administration in respect of demands and refunds getting time barred due to long period of lockdown/restrictions on account of Covid-19 pandemic. A request was made to consider extension of timelines in respect of aforementioned proceedings. Proposal: LC Recommendations: limitation under section 73 for FY 2017-18 for issuance of order in respect of recoveries linked with due date of annual return, may be extended till 30th September, 2023, under the powers available under section 168A of CGST Act. Further, no such extension may be allowed for timelines under section 74 of the Act, as the Act provides fo....
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....ounds, the judgement of Hon'ble High Court of Kerala was also accepted by the government. The issue was deliberated by the Law Committee in respect of apparent anomaly between the law pronounced by the Hon'ble High Courts vis-a-vis the existing legal provisions. Agenda 3(XVI): Refund of accumulated ITC to Duty-Free Shops (2/2) Proposal: [Vol 2- Pg. 11-15] LC Recommendations: To align rules and notifications with the decision of Hon'ble High Courts to treat the supply of goods by Duty Free Shops to outgoing international passengers as zero-rated supply by: rescinding rule 95A of the CGST Rules. 2017 and Circular No. 106/25/2019-GST dated 29.06.2019 ab initio âš« rescinding notification No. 10/2019-Integrated Tax (Rate). notification No. 11/2019-Central Tax (Rate) and notification No. 11/2019-Union territory Tax (Rate) all dated 29.06.2019; For future, there is a need to exclude refund in respect of ITC on inputs/ input services pertaining to DFS at Arrival Terminal by amending Explanation to sub-section (3) of section 17 of CGST Act by including certain transactions under paragraph 8(a) of Schedule III of CGST Act in the value of ex....
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....3 of the Finance Act, 2021 relating to amending section 16 of the IGST Act and to notify the class of supplies and class of persons who can export on payment of IGST (2/2) GOM in its interim report on capacity based taxation and special composition scheme for certain sectors placed before 45th GST Council meeting on 17.09.2021 has recommended that IGST refund route to be closed for Mentha oil as and when amended section 16 is notified and the said recommendation was approved by the GST Council. There are also reports of misuse of facility of IGST refund by a unscrupulous elements in respect of items of HSN Chapter 24, including tobacco and tobacco products. Proposal before the Council: ✓ To notify Section 123 of the Finance Act, 2021 for amendment in Section 16 of the IGST Act. ✓Class of supplies: All supplies of goods and services, except for Mentha oil and goods of HSN Chapter 24 (including tobacco and tobacco products), may be notified as class of supplies under clause (ii) of sub-section (4) of amended Section 16 of IGST Act, 2017. The proposal will help in implementing the decision of GST Council with respect to cl....
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....as already been reduced to Rs 20 crore for all taxpayers, including those supplying gold and precious stones, with effect from 01.04.2022. Levy of GST on RCM basis on Old Gold: â– The issue of levy on GST on reverse charge mechanism (RCM) basis on purchase of old gold by registered dealers/ jewellers from unregistered persons may be referred to Fitment Committee for detailed examination. The recommendations of GoM are placed before GST Council for deliberations and decision. Page 105 of 155 as CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Shipra Issue: Agenda 3(XX): Consent based data sharing GST eco-system captures valuable data in electronic data that has use cases other than tax administration There are some platforms that provide various value added services based on financial data obtained from various sources GST data can be used for such value added services like flow based lending to MSME - TREDS platform and Account Aggregator framework of RBI Currently GST law has a blanket bar on sharing of data submitted by taxpayer Proposal: Law Committee recommendation: â– Law may be ame....
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.... auto-populated values Proposal: Final decision on stopping News Return Development may be taken Page 108 of 155 Capability developed Shipra Shipra MINUTE BOOK Agenda: Extension of T & M for LEAP and REAP GIN GIN · Background: T&M model: Software development under actual identified resources utilization model GST Council 43rd meeting decision: Approved maximum 200 resources till 31st March, 2022 Difference in T&M model and normal CR model ⚫ T&M model payment is calculated in terms of man-days of resources. ⚫ Normal CR model a sizable time gets spent on estimation of efforts and then designing with to and fro movement between GSTN and Infosys till agreement is arrived at the effort estimation. Change Management (Non-T&M Model) involves six stages and intermediate negotiations on effort and estimate BRO SRS 14 Approval Design Development Deploy to UAT and R Finalize Detailed Business requirement business requirement along with Prototypel if reg) Impact Analysis document along with effort estimation Detailed design Approval ( TDD) Devel....
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....f operation 1st October, 2022 4 Ernst & Young LLP NIC Proposal for IRP 2 received ⚫ GSTC may agree for IRP 2 of NIC 04.07.2022 THANK YOU!! GIN Goods And Services Tax Network Go on 657 system Reforms Page 111 of 155 CHAIRMAN'S INITIALS Document 5 CHAIRMAN'S INITIALS MINUTE BOOK Amendments in provisions relating to GSTAT Annexure-5 Triggers for amendments ⚫ Judgment of Madras High Court • Composition of each Bench with one judicial member but two technical members dilutes judicial balance ⚫ Judgement of Supreme Court in various cases leading to Tribunal Reforms Act, 2021 • Related to composition of Search and Selection Committee - to be headed by Chief Justice of India or a Judge of Supreme Court nominated by him • Removal etc on recommendation of the Committee • Tenure, retirement age, salary allowances etc. ⚫ GSTAT Rules, 2019 are already under challenge for being not in line with these judgements. Page 112 of 155 Shipra Shipra MINUTE BOOK Bench Composition ⚫ Currently, one Judicial Member, two Technical Members - one from Centr....
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.... Existing Term Retirement Three years Seventy years Three years Five Years Sixty-five years Proposed Term Four years Retirement Seventy Years Sixty-seven years Page 115 of 155 CHAIRMAN'S INITIALS Document 6 CHAIRMAN'S INITIALS MINUTE BOOK Group of Ministers (GoM) on Rate Rationalization 47th GST Council Meeting 28th-29th June, 2022 Contents ■Background ■Terms of reference ■Proceedings of the GoM 。 Inverted duty correction o Review of exemptions ■Interim report of the GoM Future road map Page 116 of 155 Annexure-6 2 Shipra Shipra MINUTE BOOK Background & constitution of the Group of Ministers Deliberations during the 45th GST Council Meeting ■Agenda 17: Review of Revenue position ■Agenda 18: Compensation- Scenario post June, 2022 Revenue dip during two pandemic waves 。 Although recovery post second wave has been robust. ■Need for measures to augment revenue • Corrective steps for inversion correction in mobile phones, footwear, etc already taken ■GST Council directed t....
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....ific Fitment Committee proposals related to IDS correction and review of exemptions were discussed in detail â– Proposals where there was general agreement were taken forward â– In the third meeting, proposals related to above 2 Terms of Reference were finalised by the GOM, to be included in an Interim Report for consideration of the Council â– For remaining issues, GoM felt that further discussion is needed before a view can be taken Page 119 of 155 CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Inverted Duty correction Inverted Duty in GST rate structure What is Inverted Duty Structure (IDS)? Instances of IDS Why is IDS undesirable? GST on Value Addition only Tax paid on inputs available as Credit (ITC) ITC set off with output tax liability Fertilizers Mobiles Footwear Manmade yarn, fabrics If Output Tax liability > ITC, IDS exists Renewable energy devices Tractors Unutilized ITC becomes a cost to the manufacturer To correct the anomaly, refund of unutilized ITC must be given This causes cash-flow issues for trade Rs. 20,000 Crore refund i....
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.... and grinding machines including chakki and Wet grinder 5% 18% Restriction on IDS refund on edible oil and coal Inverted duty structure - Services â– The GoM examined the inverted duty structure in following services - - Services provided by a foreman of a chit fund - Works contract service supplied to government, local authorities and for construction of roads bridges etc. - Services by way of job work in relation to i. processing of hides, skins and leather; ii. manufacture of leather goods or footwear; iii. manufacture of clay bricks; iv. textile & textile products and tailoring services. Page 122 of 155 13 14 Shipra Shipra MINUTE BOOK Inverted duty structure - Services ... â– Services supplied by foreman to chit fund may be increased from 12% to 18% â– GST on job-work in relation to processing of hides, skin, leather and manufacture of footwear on job work may be increased from 5% to 12% 。 GST rate on footwear has been increased to 12% w.e.f 1.1.2022 • Leather goods are already at 18%. â– Manufacture of clay bricks on job work may be increased from 5% to 12% â....
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....ide, plug revenue leakages • Higher GST paid by the states will flow back to them in the next month • Financial devolution would ensure positive net flow to states at higher GST • GST Council may take final view on increasing GST rate on WCS supplied to government and local authority Page 125 of 155 Review of Exemptions 19 CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Review of exemptions - Goods: 'Branded' items • A number of items (mostly food grains, cereals, etc) when supplied unbranded are exempt from GST Condition for exclusion from exemption is that the corresponding items must be put up in unit container and - a) bearing a brand name; or b) bearing a brand name on which actionable claim or enforceable right in a court of law is available (other than where any actionable claim or enforceable right in respect of such brand name has been voluntarily foregone.) (i.e. such items when put up in unit container and satisfying condition (a) or (b) above are being taxed at applicable rates) 21 Review of exemptions - Goods: 'Branded' items ... ■Subjective term 'bran....
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....the suppliers: reversals of ITC ■GST exemptions on B2B supplies such as the following may be withdrawn: o Transportation of railway equipment and material ⚫ Services provided by common bio-medical waste treatment facility 。 Fumigation in a warehouse of agricultural produce. 。 Storage or warehousing of goods which attract GST (spices, copra, sugarcane, jaggery, cotton, unmanufactured tobacco etc.) ■Exemption on reinsurance of exempted insurance services may not be withdrawn 。 Exempted insurance schemes meant for poor and farmers 。 Premium mostly borne by Centre or State governments CHAIRMAN'S INITIALS 25 Review of exemptions - Services... ■Exemptions to Regulators o Like other entities, regulators should pay GST on their supplies 。 No exemption has been given to Lok Sabha Secretariat and Rajya Sabha Secretariat also • No exemption on services supplied by Government or Local Authority to business entities o Exemption may be withdrawn on services supplied by RBI, IRDA, SEBI, FSSAI, GSTN ■Exemptions prone to misuse o Exemption on hotel accommoda....
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....xemptions in Goods- 31 Review of memption condition from 'brandnt to page and labelled 3.2 Withdrawal of exemption in Goods Review of exemptions in Services- 41 Exemptions on services which mostly are B2B supples 8.2 Exemptions to Regulators... 4.3 Exemptions prone to misuse 44 Exemptions not warranted as recipient could afford to pay 45 Rationalization of tax structure on services supplied by Department of Post- 46 Miscellaneous Exemptions Annexure-B Constitution of Group of Ministers on Rate Rationalization Annexure-C Press Release on recommendations of the GST Council Meeting 29 Future Roadmap â– GOM felt that issue of GST rate slab re-structuring requires further deliberation â– Inversion in Textiles sector referred to GoM by 46th GST Council Meeting â– Few miscellaneous issues forwarded by Fitment Committee also to be examined. â– Extension of three months sought for completing deliberations on remaining Terms of Reference and submission of final report Page 130 of 155 Shipra Shipra MINUTE BOOK THANK YOU 31 Page 131 of 155 CHAIRMAN'S INITIALS Document 7 CHAIRMAN'S IN....
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....g. 2) B. Physical Verification mandated by System Officer shall undertake verification compulsorily Reg. Y/N REG 06 Page 133 of 155 2/2 CHAIRMAN'S INITIALS 仆 MINUTE BOOK Risk Assessment of New applicants using Machine Learning (ML)) - (Agenda 2A) Issue #: Risk Assessment of New applicants/registrants using Machine Learning (ML) and to carry out Mandatory Physical Verification as Assigned by the System (Item2A) GIN Solution #: AIML and Risk Based risk assessment of new registrations for mandatory physical verification GOM Decision #: GoM approved identifying risky behaviour of the new registrants/applicants using AI/ML and place the information on the back office for the field officer to carry out mandatory physical verification of these taxpayers. Risk Assessment of New Applicants using Machine Learning (Diagram 2) GIN Applicant coming on GST Portal for New Application GST REG-01 Processing application based on risk parameters including AIMI Risk Assessment High Risk Aadhaar opted "Yes" Biometric Authentication done+ Site verification- M....
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....-Coding and for officers to carry out physical verification of high-risk taxpayers or getting correct address filed by the taxpayers. Online Address verification of New and Existing Taxpayers with help GIN of Geocoding(Agenda 2C) application provided by Map My India (MMI) using comparison with Geo-Coded Value âš« In case of major gap, mandatory physical verification shall be undertaken:- âš« Either by departmental officer or . Through any other agency as required by the state, before approval of such application. âš« MIS of such applications and outcome of physical verification may be given to the senior officers. Residential Address 1390 GOL Maruti Su HALLMATA, VLCC tute of Beauty Comfors Hyundai ADARSHNAGAR Kerala Transpor Sl No Field Name 4 5 6 The Golden Campany Ocak chool ICICLATM Arispensary Complete Match Mandir OLD EA Scivestave Technology & Management As-Is Value Geo-Coded Value Country Pincode State District City/Town/Village Locality/Sub-Locality India 831001 Jharkhand East Singhbhum Jamshedpur, Agrico India 831....
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....ould highlight the high-risk category of taxpayers on a near real-time basis, for taking action by the tax officers This system would highlight the high-risk category of taxpayers on a near real-time basis, for taking action by the tax officers Input from GSTN Validation from NPCI Header Reference No. PAN IFSC Code Account number IFSC Bank Account validity Primary Account holder PAN Primary Account Holder Name. Account Number Parameter Type, Account ID, name State Code Sample OTH1038710 AAQFG7471F BNPA0009008 3002133454545 V Null verified Not avialble Null Not avialble V Verified CHAIRMAN'S INITIALS Page 138 of 155 Shipra Shipra MINUTE BOOK Lead based dashboard, Task & Case Creation and Feedback Mechanism GIN in Back Office (Agenda 7) Issue #: Task & Case Creation and Feedback Mechanism in Back Office Solution #: Action on ITC surge leads of BIFA GOM Decision #: GoM approved development of BI-BO Feedback Mechanism for capturing the feedback of leads generated by BIFA (and provided to tax officers in BO systems) GIN Feed....
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....arh ° Schema of the Presentation Constitution of the GoM Considerations made by the GoM ⚫ Challenges ⚫ Deliberations by the GoM Recommendations Page 141 of 155 2 Annexure-8 CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Constitution of the GoM on Casinos, Race Courses and Online Gaming In May 2021, the GoM on Casinos, Race courses and Online Gaming was constituted with following Terms of Reference: To examine the issue of valuation of services provided by Casino, Race course and online gaming portals and taxability of certain transactions in a casino, with reference to the current legal provisions and orders of Courts on related matters. ■To examine whether any change is required in the legal provisions to adopt any better means of valuation of these services ■To examine the administration of such valuation provisions if an alternative means of valuation is recommended ■To examine the impact on other similarly placed services like lottery. 3 Constitution of the GoM ■Meanwhile, GST Council in its 45th meeting held on 17.09.2021 agreed to defer v....
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....cifically provide Value of supply as follows: i. Lottery 100/128 of face value of ticket ii. Betting, gambling- 100% of face value of bet iii. Horse racing: Amount paid to the totalisator [Rule 31 A] Page 144 of 155 H Shipra Shipra MINUTE BOOK Provisions of the GST Law GST Rate: Actionable claim involved in betting, gambling, or horse racing in race club has been kept in 28% rate slab [Notfn 1/2017-Rates] Recreational, cultural and sporting services of: -Admission to Casino/Race Club/ events like IPL -Services provided by Race club -Gambling are also placed in 28% slab [Notfn 11/2017-rates] Provisions of the GST Law Clarification has also been issued that 28% rate would apply on entry to casinos as well as on betting/gambling on the total bet value âš« Further, GST would be leviable on entire bet value, that is, total of face value of any or all bets paid into the totalisator or placed with licensed bookmakers [Circular No. 27/01/2018-GST dated 04.01.2018] Page 145 of 155 10 CHAIRMAN'S INITIALS MINUTE BOOK Jurisprudence Sunrise Associates (2006) The Constitution Bench of t....
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.... Court. It should not be re-opened. Page 149 of 155 12 CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK â– The actionable claim provision is common and should be equally treated in all such cases. â– The GoM also felt that any different view on actionable claim for casino, online gaming, horse racing will also have implication on lottery. â– Simplification of GST principles to be kept in mind. 18 Deliberations by the GoM â– All these activities are to be uniformly taxed and because of their nature and negative externalities, should be levied a higher incidence of tax â– GST being a pass-through tax, the incidence of entire GST is borne by the players, and its incidence does not fall on the suppliers involved in these activities â– Recommendations regarding valuation should be made in conformity with the statutory & legal framework and the jurisprudence in similar matters. Page 150 of 155 19 Shipra Shipra MINUTE BOOK Deliberations by the GoM Legislative Intent: â– Law does not differentiate between game of chance or game of skill: In valuati....