TaxTMI 
TaxTMI 
Minutes of the 48th Meeting of GST Council held on 17th December, 2022
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.... the consideration of the GST Council a) Recommendations made by the Fitment Committee for making changes in GST rates or for issuing clarifications in relation to goods - Annexure-I b) Issues where no change has been proposed by the Fitment Committee in relation to goods - Annexure-II b) Issues where no change has been proposed by the Fitment Committee in relation to goods - Annexure-III d) Recommendations made by the Fitment Committee for making changes in GST rates or for issuing clarifications in relation to services - Annexure-IV e) Issues where no change has been proposed by the Fitment Committee in relation to services - Annexure-V f) Issues deferred by the Fitment Committee for further examination in relation to services - Annexure-VI 4 Report of the Committee on Levy of penal interest on delayed remittances of GST by the Banks to the Government Accounts in RBI during the initial period of GST implementation. 5 Performance Report of the NAA (National Anti-profiteering Authority) for the 1^st quarter (April, 2022 to June, 2022) and 2nd quarter (July,2022 to September. 2022) along with monthly performance report for the months of October and Nove....
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....s in GST Clarification on taxability of No Claim Bonus offered by Insurance Companies Clarification on applicability of e-invoicing w.r.t an entity xiii. Clarification regarding treatment of the difference in ITC availed in GSTR-3B as compared to that available in GSTR-2A for FY 2017-18 and 2018-19 XIV. Clarification regarding the treatment of statutory dues under GST law in respect of the taxpayers for whom the proceedings have been finalised under the Insolvency and Bankruptcy Code, 2016 XV. Amendment in provisions related to OIDAR Services under the IGST Act, 2017 xvi. Amendment in Section 17 of the CGST Act, 2017 regarding ITC in respect of CSR (Corporate Social Responsibility) expenditure xvii. Issues related to place of supply in terms of the proviso to Section 12(8) of the IGST Act, 2017 8 Issues recommended by GSTN: 1. Proposed Changes in HR Policies and Transition Management from GSTN 2. Proposal for Changes in the Revenue Model of GSTN and transition to the new Revenue Model 3. Waiver of Interest on delayed receipt of Advance User Charges (AUC) from a few states and CBIC 4. Data Archival Policy for the GST System 5. Implementation....
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....nd thanked ex Revenue Secretary, Sh. Tarun Bajaj for his contribution. 1.4 With the permission of the Chair, the Secretary to the GST Council welcomed all the Hon'ble Members of the Council and participating officers to the 48th meeting of the GST Council. The Secretary, on behalf of the Council, thanked the following former Hon'ble Members of the Council for their immense contribution - 1. Shri Tarkishore Prasad, ex Member from Bihar 2. Shri Ajit Pawar, ex Member from Maharashtra 3. Shri Sukh Ram Chaudhary, ex Member from Himachal Pradesh He further extended a warm welcome to the incoming Hon'ble Members of the GST Council to the 48th meeting of the GST Council- 1. Sh. Devendra Fadnavis, Hon'ble Deputy Chief Minister, Maharashtra 2. Sh. Vijay Kumar Chaudhary. Hon 'ble Finance and Commercial Tax Minister, Bihar and thanked ex. Revenue Secretary, Sh. Tarun Bajaj for his contributions. 1.5 The Secretary stated that in its 47^th meeting at Chandigarh, the Council had formed a GoM on Goods and Services Tax Appellate Tribunal with Sh. Dushyant Chautala, Hon'ble Deputy Chief Minister of Haryana as the Convener and Hon'ble Ministers from States ....
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....o the upcoming Council meeting to be discussed in physical mode. He explained that due to budget session approaching, Hon'ble Members would be pre-occupied. Hon'ble Members from Telangana, Gujarat, Karnataka, Maharashtra etc. agreed with this suggestion and many States like Gujarat, Haryana, Kerala and Andhra Pradesh suggested that items could be prioritized and the Tribunal agenda could be discussed on priority. Hon'ble Member from West Bengal stated I that she was agreeable with any decision taken by the Council in that regard. 1.12 The Secretary stated that the majority view appears to be that the meeting could be concluded by 01:30p.m. He informed that the officers meeting on 16^th December was concluded by 03:00 p.m. even when the Law Committee agenda was discussed at length. He suggested that a call could be taken around 1:30 p.m. as the meeting progressed. The Hon'ble Chairperson accorded permission to start with the agenda. 2. Agenda Item 1: Confirmation of the Minutes of the 47^th Meeting of the GST Council The first agenda item pertained to confirmation of the minutes of the 47th GST Council meeting held on 28th and 29th June, 2022 at Chandiga....
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....h and sixth Annexures pertaining to the services. 4.2 The Secretary to the Council stated that the recommendations of the Fitment Committee were discussed in detail in the Officer's Meeting on 16.12.2022 and most of recommendations were agreed to by all. Then the Secretary asked JS, TRU to take the Council through a brief presentation on the recommendations of the Fitment Committee. 4.3 Joint Secretary, TRU stated that the agenda note dealt with proposals regarding GST rates and clarifications relating to supply of goods and services. The proposed changes emanated from the recommendations made by the Fitment Committee on the basis of representations received from various stakeholders including Ministries and other offices of Centre and States, seeking changes in GST rates/ issuance of clarifications regarding classification and GST rates applicable on supply of certain goods and services. 4.4 She further informed that the Fitment Committee had examined the representations on 12^th & 23th September, 2022 and 28th October, 2022. After examination, the Fitment Committee had recommended changes in GST rates or issue of clarifications, in relation to certain goods and ser....
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....rates under Chapter 23, in order to have clarity and avoid confusion amongst the concerned suppliers regarding the GST rate on the supply of subject goods and for the ease of administration of the levy, these products could be exempted from GST, irrespective of their end use. Fitment Committee also recommended that a clarification be issued to regularize the matter of the intervening period on as is basis from the date of issuance of the last Circular (that is, consequent to 47th GST Council Meeting) on account of genuine doubts. 4.10 The Hon'ble Member from Madhya Pradesh supported the proposal to exempt the by-products of milling of dal/pulses like Kanda, Churi (also known as Chuni), Chilka from GST, irrespective of their end use. 4.11 The Hon'ble Chairperson suggested that there could be full presentation on agenda 3 (a) and then the floor would be opened for discussion. 4.12 JS, TRU then presented the issue relating to SUV cars wherein doubts had been raised as to whether aU four conditions viz. engine capacity exceeding 1500 cc, popularly known as SUV, a motor vehicle of length exceeding 4000 mm and having ground clearance of 170 mm and above need to be satisfied for ....
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....awat) falls under HSN 1702 attracting 18% GST. 4.16 The next item presented pertained to issuance of clarification regarding products such as fryums manufactured using the process of extrusion. The Fitment Committee recommended to clarify that the item 'fryums' manufactured using the process of extrusion would fall under CTH 1905 attracting GST @ 18%. 4.17 She presented the next issue regarding clarification sought on applicable IGST rate on items imported for petroleum operations under Notification No. 3/2017-Integraied Tax (Rate) wherein the Fitment Committee had noted that the said Notification provided a concessional rate of duty to such products which attracted a higher rate of GST when those goods were imported for petroleum operations. The Fitment Committee recommended that a clarification could be issued that a taxpayer could claim the lower rate for specific items as given in the Schedule. 4.18 The next item presented was for extending concessional rate of 5% on Ethyl alcohol supplied to refineries for blending with motor spirit (petrol). JS TRU stated that the National Policy on Biofuels - 2018 provided an indicative target of 20% ethanol blending under the Ethan....
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....nd also fulfilled remaining three conditions to be classified as a SUV. 4.24 The Hon'ble Member from Haryana further stated that there was a category of cars like Multi Utility Vehicle (MUV), which might also fulfil above conditions, but would not attract a higher rate of tax since that was not called a SUV. 4.25 The Hon'ble Chairperson asked JS TRU from where the definition of SUV was derived. JS, TRU responded that the definition of SUV was carried forward from the Central Excise regime. The Hon'ble Chairperson enquired about how the issue of compensation cess in case of other variants of vehicles like MUV that were available in the market would be addressed, JS, TRU responded that that aspect was yet to be seen. 4.26 The Chairman, CBIC suggested that other types of vehicles could also be included which satisfy the other three conditions as pointed out by the Hon'ble Member from Haryana. The Hon'ble Chairperson further enquired about the treatment of MUVs under that proposal. 4.27 The Chairman, CBIC suggested that MUVs might also be included in the Explanation for levy of higher rate of compensation cess @ 22% like SUVs. The Hon'ble Chairperson enquired whether the su....
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....ed to standalone petroleum refineries as well for blending with petrol in order to provide a level playing field, keeping in view the implementation of the Ethanol Blending Programme. 4.34 The Secretary to the Council also clarified that the rate on Pencil Sharpener was increased from 12% to 18% on the basis of recommendation of GoM to rectify inverted duty structure and to address the inconsistency. to address the inconsistency. The Hon'ble Chairperson further clarified that the proposal was only for removal of inversion in duty rate structure and to streamline the tax structure on the item. She stated that the inversion scenario on the item, quantum of refunds being given etc. could be examined in detail by the Fitment Committee and then a fresh proposal brought as to whether a lower rate of GST on pencil sharpeners could be considered. 4.35 Further, the Secretary stated that the Council may approve the existing proposals in Agenda-3 (a) whereas the issues raised by the Members regarding the lower tax rate on pencil sharpener; compensation cess on vehicles which were similar to SUV and fulfilling the mandated conditions; and lower GST rate on Rab would be ....
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....A of Notification NO. 12/2017-CTR dated which provides exemption to the service by way of access to a road or a bridge on payment of annuity. • To clarify the applicability of GST on revenue apportioned by Indian Railways (IR) to SPVs and O&M costs charged by Indian Railways from SPVs, • To clarify applicability of GST on Air Force Officers Mess. • To clarify whether GST is applicable on the incentive paid by MEITY to the Banks under the Scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions. • To clarify the applicability of GST when the residential dwelling is rented by a person who is the proprietor of a proprietorship firm in his personal capacity for use as his own residential dwelling, The proposal was to amend the entry as well as insert an Explanation to the entry No. 12 of Notification No. 12/2017-CTR • To specify a positive list of services under Sr. No. 3 & 3A of Notification No. 12/2017-Central Tax (Rate). 4.43 The Secretary informed the Council that on the issue of clarificatory circular regarding applicability of GST on Air Force Officers' Mess, a s....
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....sion. 4.49 The Hon'ble Member from Karnataka suggested that if there were any other additional services then the Council should take that as specific cases. However, all the services which are as per the Constitution should be kept untouched. 4.50 The Hon'ble Member from West Bengal also suggested that there was no requirement to prune the list of services and all functions as listed out in Articles 243G and 243W of the Constitution should be exempted. 4.51 The Hon'ble Member from Uttar Pradesh, Gujarat, Goa, Tripura and Assam supported the proposal of the Fitment Committee to have a positive list of specified Services. 4.52 The Hon'ble Member from Andhra Pradesh requested to exempt pure manpower services which were hired by the Government or Government agencies and that in case of local bodies, entire services mentioned in Eleventh and Twelfth Schedules of the Constitution should be exempted. 4.53 The Hon'ble Member from Kerala suggested to take the issue later as it required more discussion. 4.54 The Secretary stated that in GST regime there were no end use-based exemption in case of supply of goods to Government. However, in case of services during the Service ....
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....with ITC on construction service. The Council approved the proposals in Agenda 3(e). 4.61 JS, TRU further informed the Council that agenda 3(f) was regarding four issues which had been deferred. The Council approved the proposals in Agenda 3(f). 4.62 The Hon'ble Members from Odisha and Telangana requested to exempt the levy of GST of 18% on Tendu leaves because it was a matter involving the livelihood of tribal people. Further, the Tendu leaves were used only in Bidi making which was leviable to GST @ 28% and there was no possibility of inverted duty structure. 4.63 The Hon'ble Chairperson requested the Hon'ble Members from Odisha and Telangana to forward their submissions to the Fitment Committee which in turn would study the issue in detail. 5. Agenda item 4: Report of the Committee on Levy of penal interest on delayed remittances of GST by the Banks to the Government Accounts in RBI during the initial period of GST implementation The Secretary presented the Agenda No. 4 pertaining to the Report of the Committee on Levy of penal interest on delayed remittances of GST by the banks to the Government Accounts in RBI during the initial period of GST implementatio....
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....acing ad-hoc exemption orders issued under Section 25(2) of the Customs Act, 1962 before the GST Council for information could be continued. The Council took note of the ad-hoc exemption orders issued. 8. Agenda Item 7: Issues recommended by the Law Committee for the consideration of the GST Council 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 16^th December, 2022 and there was an agreement in the Officers' meeting on most of the issues. He stated that in the Officers' meeting, concerns were raised on the agenda item pertaining to deletion of clause (d) of sub-rule (14) of Rule 138 of CGST Rules which was proposed for providing a uniform threshold for intra-state movement of goods and it was suggested that the agenda item need not be considered for approval by the Council. He requested Principal Commissioner, GST Policy Wing to make a presentation on the recommendations of the Law Committee and the discussions held in Officers' meeting on 16" December, 2022 on the same. The Principal Commissioner, GST Policy ....
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....only in Gujarat SGST Rules, 2017 and in the CGST Rules, 2017 at this stage. He added that Rule 8(4B) needs to be introduced only in the CGST Rules, 2017 and that Centre will need to issue a Notification under Rule 8(4B) for specifying all States and UTs, except State of Gujarat, where provisions of Rule 8(4A) will not apply. 8.1.3. The Hon'ble Member from Haryana stated that at present, the time limit for verification of registration applications in non-Aadhaar cases is 30 days and he requested that the time limit for such non-Aadhar based verification be raised to 90 days as many fake companies get deemed registered after a period of 30 days. He requested the council to increase the time limit for verification to either 90 days or to 60 days in order to enable the officers to physically verify those companies. 8.1.4 The Secretary clarified that the time limit for processing of the application of registration in cases, where Aadhaar number was not authenticated, had been kept at 30 days in line with ease of doing business for providing registration as quickly as possible. B Incorporation of details of electricity bill and property registration in FORM GST REG-01 8.1.5 P....
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....wever, OTP-based verification in Part-A of FORM GST REG-01 was done to verify only the mobile number and email address provided by the authorized signatory and no intimation was sent to the mobile number and email address of the PAN holder when a GST registration was applied for. It was stated that that communication gap might result in misuse of PAN of a person, without his knowledge, by unscrupulous elements. 8.1.10 The issue was deliberated by the Law Committee and it recommended that PAN-linked mobile number and email address (fetched from CBDT database) might be captured and recorded in FORM GST REG-01 and further, OTP based verification in Part-A of FORM GST REG-01 might be done only on PAN-linked mobile and email address, instead of authorised signatory's self-declared mobile number and email address. 8.1.11 Accordingly, Law Committee proposed amendments in CGST Rules and FORM GST REG-O1 as detailed in the agenda note. The Council agreed with the said recommendations of the Law Committee in agenda item 7(i). 8.2 Agenda Item 7(ii): Refund to unregistered persons 8.2.1 Principal Commissioner, GST Policy Wing stated that representations had been received from unr....
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....mining relevant date in such cases in terms of clause (g) of Explanation (2) under Section 54 of the CGST Act, 2017, date of issuance of letter of cancellation of the contract/ agreement for supply by the supplier might be considered as the date of receipt of the services by the applicant. The Council agreed with the recommendations of the Law Committee detailed in agenda item 7(ii), along with the proposed amendments in CGST Rules, 2017 and the proposed Circular. 8.3 Agenda Item 7 (iii): Decriminalization of the CGST Act, 2017 8.3.1 Principal Commissioner, GST Policy Wing informed that the issue of decriminalization of various laws, including GST law, to reduce compliance burden on the taxpayers, was discussed in the meeting of Committee of Secretaries (CoS) on Decriminalization of existing Acts/Rules. It was also deliberated that there might be a need to examine whether any enhancement was required in the threshold for prosecution of offences under Section 132 of the Central Goods and Services Tax Act, 2017. 8.3.2 Accordingly, Law Committee deliberated on the various provisions pertaining to prosecution and compounding in the CGST Act, 2017, so....
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....lt to prosecute such bill traders as civil cases and that was much more effective to prosecute them as criminal cases. 8.3.5 The Hon'ble Member from Puducherry stated that they completely agreed with the views of State of Tamil Nadu and added that in small UTs like Puducherry, it would not be possible for them to book cases if the threshold for prosecution was raised to Rs. two crore. 8.3.6 The Hon'ble Member from Goa stated that if the threshold for prosecution was increased to Rs. two crore then many cases would go out of the prosecution net. He stated that the threshold should be maintained at Rs. one crore so that there was some fear in dodging the payment of GST especially in case of trading of invoices. 8.3.7. The Hon'ble Member from Kerala stated that the limit for prosecution should continue at the present threshold, especially with regard to the bill trading. He suggested that the existing provisions could be continued as of now and the enhancement of threshold might be considered at a later stage. 8.3.8 The Hon'ble Member from Punjab stated that it would be desirable if the limit for prosecution for fake invoices cases could be ....
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.... item and that there were voices on both sides. 8.3.12 The Hon'ble Member from Maharashtra stated that they totally supported the proposal made by the Law committee as statistics given by the Secretary held true even for the State of Maharashtra. The Hon'ble Member further elaborated that that was often seen that although that had deterrence value, that was impractical to prosecute so many people. He further stated that when the whole country was moving towards decriminalization, that was a very valid decision to raise the threshold for prosecution in GST to Rs. two crore. 8.3.13 The Hon'ble Member from Chhattisgarh stated that that was a very wise decision for the Chairperson to call for unanimity and he stated that they would go by the decision of the Hon'ble Chairperson. 8.3.14 The Hon'ble Member from Goa stated that there were valid points on both sides and the decision on the said agenda could be left to the decision of the Chairperson of the Council. 8.3.15 The Hon'ble Member from Kerala stated that the Council could continue with the present threshold and in future the matter could be relooked at. He further stated that their State was....
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....mittee also recommended amendment in Rule 94 of the said Rules for prescribing the manner of computation of period of delay for purpose of calculation of interest payable on delayed refund. The Council agreed with the recommendation of the Law Committee in agenda item 7(iv). 8.5 Agenda Item 7 (v): Clarifying the manner of re-determination of demand in terms of sub-section (2) of Section 75 of the CGST Act, 2017. 8.5.1 Principal Commissioner, GST Policy Wing informed that in cases where the Appellate Authority/Appellate Tribunal/Court held that the notice under sub-section (1) of Section 74 of CGST Act, 2017 was not sustainable for the reason that the charges of fraud or wilful misstatement or suppression of facts to evade tax had not been established against the person to whom the notice was issued and directed the proper officer to determine the tax payable by such person deeming the notice to be issued under sub-section (1) of Section 73 of CGST Act, 2017, field formations were seeking clarification regarding the time limit within which the proper officer was required to re-determine the amount of tax payable considering notice to be issued under sub-sectio....
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....om trade that there was no option available for an e-commerce operator having TCS registration to apply for cancellation of TCS registration in case of the closure of the operations of e-commerce operator. It has been requested to provide an option to cancel TCS registration. Similarly, there was also no option presently for a TDS registrant to apply for cancellation of TDS registration. 8.6.3 The Law Committee deliberated on the issue and recommended for amendment in subrule (3) of Rule 12 to provide an option to the TCS and TDS operators to apply for cancellation of their registration. The Council agreed with the recommendation of the Law Committee. II. Amendment in sub-rule (1) of Rule 37 8.6.4 Principal Commissioner, GST Policy Wing informed that the second proviso to Section 16 (2) of the CGST Act, 2017 provides for cases where a recipient fails to pay to the supplier the amount towards the value of supply along with tax payable thereon within a period of 180 days. 8.6.5 He mentioned that such recipients had to follow the procedure prescribed in Rule 37(1) of the CGST Rules, 2017. However, the said Rule had been amended with effect from 01.10,2022 vide Notificat....
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.... clause (f) of Rule 46 of CGST Rules, 2017 to ensure mandatory recording of address of unregistered recipients of service along with the PIN code when the said services were provided through online platform by a registered person even if the value of taxable supply was less than fifty thousand rupees. 8.6.9 The Hon'ble Member from Telangana welcomed the amendment to the tax invoice rules under Rule 46, but he stated that they had some concerns on the said issue especially in relation to Telecom sector. He added that in case of telecom services, the addresses of consumers were not provided by telecom operators to their distributors such as PhonePe, Paytm, BillDesk etc. He further stated that when the consumers purchased data from the said distributors, those distributors were not allowed to collect the address and the operators did not provide those details to distributors due to TRAI Rules. The Hon'ble Member stated that the TRAI Rules neither allowed the collection of details of addresses nor did that allowed sharing of addresses. He added that the State of Telangana received about Rs. 600 crore on such business transactions and therefore, requested intervention of the C....
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....hat Rule 46A needed to be amended accordingly to make that obligatory on the part of a registered person, who was supplying taxable as well as exempted goods or services or both to an unregistered person, to include the relevant particulars as prescribed in Rule 46 or Rule 49 or Rule 54, as applicable, while issuing a single "invoice-cum-bill of supply". The proposed amendment to Rule 46A is detailed in the agenda note. The Council agreed with the recommendation of the Law Committee. VI. Insertion of proviso in sub-rule (8) of Rule 87 8.6.13 Principal Commissioner, GST Policy Wing informed that in cases where bank fails to communicate the CIN details of taxes paid through e-payment mode to GST System for updating the Electronic Cash Ledger (ECL), the ECL of such taxpayers are updated next day on the basis of RBI e-Scroll file containing the successful payment made against the CINs as shared by banks with RBI. However, there is presently no provision in the CGST Rules, 2017 providing for such updation of ECL based on e-Scroll of RBI. In this regard, CAG has highlighted the need for having a specific provision in law for updation of ECL on the basis of e-Scroll....
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....tified copy of such an uploaded order to vouch for its authenticity, pales into insignificance considering that the order has been uploaded by the adjudicating authority using his Digital Signature Certificate and the same is available for viewing or downloading by the appellate authority on the portal. However, in cases where the decision or order has been passed manually and has not been uploaded on the common portal, the same is not available to the Appellate Authority on the common portal. In such cases, non-submission of the certified copy by the appellant restricts the Appellate Authority from entertaining the same. 8.6.19 Law Committee accordingly recommended that to provide clarity on the requirement of submission of certified copy of the order appealed against and the issuance of final acknowledgment by the appellate authority, an amendment might be made in sub-rule (3) of Rule 108 and in Rule 109 of the CGST Rules, 2017 and Form GST APL-02. The details of the same are provided in the agenda note. The Council agreed with the recommendation of the Law Committee. VIII. Insertion of Rule 109C 8.6.20 Principal Commissioner, GST Policy Wing informed....
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....e (14) of Rule 138 of the CGST Rules, 2017 so as to exclude imitation jewellery from the exemption from the generation of e-way bill for its movement. The Council agreed with the recommendation of the Law Committee. XI. Substitution of FORM GST REG-19 8.6.25 Principal Commissioner, GST Policy mentioned that Rule 22(3) of CGST Rules, 2017 provides for an order of cancellation of registration under FORM GST REG-19. The Form contains a list of options to choose from to bring out reason for cancellation of registration. However, it was felt that there could be more scenarios based on whether the reply to the show cause notice had been submitted or not and whether the concerned person had appeared for personal hearing or not to include more scenarios. Further, FORM GST REG-19 also provided for a table for "Determination of amount payable pursuant to cancellation", which may create confusion if no amount was filled in the said table by the officer. 8.6.26 The Law Committee deliberated on the issue and recommended that FORM GST REG-19 may be substituted to include a more elaborate list of options to clarify the order of cancellation and also to include cer....
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....47^th meeting held on 28-29" June had given in-principle approval for relaxation in the provisions for supplies by unregistered person and composition dealers making supplies through e-commerce Operators (ECOs), as detailed in the agenda. The Council had also mandated Law Committee to work out the details of the scheme. 8.7.2. The Law Committee deliberated on the requisite legal changes required to implement the recommendations of the Council. It recommended that for unregistered persons, Notification may be issued under Section 23(2) of the CGST Act, 2017 for exempting unregistered persons from obtaining mandatory registration for supplying goods through e-commerce operators, subject to certain conditions. Further, two separate notifications needed to be issued under Section 148 of the CGST Act, 2017 for providing special procedure to be followed by the electronic commerce operators, one in respect of supplies of goods through them by unregistered persons and second, in respect of supplies of goods through them by composition taxpayers. Law Committee also recommended that FORM GSTR-8 might be amended for capturing the information of supplies made by unregistered su....
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.... GSTR-1/2B/3B return filing system as detailed in the agenda. The Council agreed with the recommendation of the Law Committee. B. Amendment to Section 23 to provide overriding effect over Sections 22(1) & 24 8.8.2 Section 22 of CGST Act, 2017 provides for persons liable for registration and Section 24 provides for compulsory registration in certain cases. On the other hand, Section 23 provides for persons not liable for registration and exemption of specified categories of persons from obtaining registration. However, existing Section 23 does not have any clause overriding the registration requirement imposed vide Section 24 and Section 22(1). Therefore, it was discussed that doubts had arisen as to whether provisions of compulsory registration under Section 24 prevail over the exemption under Section 23. 8.8.3 Accordingly, the Law Committee deliberated on this issue and recommended that to avoid any conflict within the said provisions and to provide more clarity, Section 23 may be amended retrospectively w.e.f. 01.07.2017 as detailed in agenda. The Council agreed with the recommendation of the Law Committee. C. Amendments in CGST Act, ....
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.... 8.8.7 Accordingly, it was proposed that as the provision relating to availment of input tax credit on provisional basis has been done away with, the words "excluding the amount of input tax credit provisionally accepted," in sub-section (6) of Section 54 of the CGST Act might be omitted. The Law Committee deliberated on this issue and recommended the proposed amendment in sub-section (6) of Section 54 of the CGST Act. The Council agreed with the recommendation of the Law Committee. 8.9 Agenda Item 7(ix): Amendment in the tables of GSTR-1 for reporting ECO Supplies made under Section 9(5) of CGST Act and attracting TCS under Section 52 of CGST Act, 2017. 8.9.1 Principal Commissioner, GST Policy Wing mentioned that as per current notified format of FORM GSTR-1, the supplies made by a registered person through e-commerce operators (ECOs) attracting TCS under Section 52 of CGST Act, 2017 are to be reported in various tables of FORM GSTR-1 i.e. 4C, SB, 7A(2), 7B(2), 10A(1) & 10B(1). The details are to be provided invoice-wise and e-commerce operator-wise. However, these tables have not yet been made functional on GST Portal. 8.9.2 Further, amendment has been made in FORM G....
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....all of which are activities to be treated as neither supply of goods or services, with effect from 01.02.2019, should be made applicable with effect from 01.07.2017. The detailed discussion is provided in the agenda. 8.10.2 Law Committee deliberated on this issue and felt that to avoid unnecessary litigation and doubts, there is a need to provide clarity in the GST law with respect of treatment of the transactions covered by Paras 7, 8(a) and 8(b) of Schedule III of CGST Act, 2017 for the period from 01.07.2017 to 31.01.2019, i.e. before the said paras were inserted in Schedule III of CGST Act. The Law Committee recommended that Paras 7, 8(a) and 8(b) in Schedule IIT should have retrospective effect w.e.f. 01.07.2017. The Law Committee also recommended that in cases where any tax has already been paid in respect of transactions/supplies covered under Paras 7, 8(a) and 8(b) of Schedule III of CGST Act during the period 01.07.2017 to 31.01.2019, no refund shall be available in respect of such tax paid. The Council agreed with the recommendations of the Law Committee. 8.11 Agenda Item 7 (xi):- Mechanism to deal with differences in liabilities between GSTR-1 and ....
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....d that Law Committee would be formulating a separate procedure for examination of such cases by the proper officer, where the taxpayer deposits the differential tax liability only partly, with or without an explanation for such short payment, and for further action for recovery of the unpaid amount in accordance with the provisions of Section 79, to the extent no satisfactory explanation has been provided by the taxpayer for such differential unpaid amount. 8.11.5 The Hon'ble Member from Haryana stated that the issue of FORM GST DRC-01B was also discussed in the Officers' Meeting. He thereafter stated that there is provision for blocking the filing of GSTR-I if the differential amount involved is more than Rs. 25 Lakh and 20% and requested that the filing of GSTR-1 might be unblocked only after verification by the officer. He further stated that there may be scenarios wherein the filing of GSTR-1 for subsequent tax period could be allowed even if the taxpayer uploads a blank paper without proper details. He proposed that such cases should be verified by a GST officer as there may be a possibility that the registration can be used for claiming more Input Tax Credit in the ....
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....ough a Circular that NCB is not a consideration in respect of any service rendered by the insured to the insurance company, rather it is an upfront discount from the premium payable by the insured for the supply of insurance services by the insurance company to the insured; and therefore, NCB is deductible for the purpose of calculation of value of supply of insurance services under Section 15 of CGST Act, 2017. B. Clarification on applicability of e-invoicing with respect to an entity 8.12.4 Principal Commissioner, GST Policy Wing presented the agenda item before the Council and stated that Notification No. 13/2020-Central Tax dated 21.03.2020, as amended, provides the class of registered persons for whom e-invoicing shall be applicable under Rule 48(4) of the CGST Rules, 2017. SEZ units, government departments, local authority and those referred in sub-rules (2), (3), (4) and (4A) of Rule 54 of the CGST Rules, 2017 have been exempted from e-invoicing. 8.12.5 Representations had been received from banking companies for clarifying the matter as banks were being subject to investigation by some tax authorities on grounds that e-invoices were required to be gen....
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....ier for the said financial year exceeded Rs 5 lakh, the proper officer shall ask the registered person to produce a certificate for the concerned supplier from the Chartered Accountant (CA) or the Cost Accountant (CMA), certifying that supplies in respect of the said invoices of supplier had actually been made by the supplier to the said registered person and the tax on such supplies had been paid by the said supplier in his return in FORM GSTR 3B. Certificate issued by CA or CMA shall contain UDIN. In cases where difference between the ITC claimed in FORM GSTR-3B and that available in FORM GSTR 2A of the registered person in respect of a supplier for the said financial year was upto Rs 5 lakh, the proper officer shall ask the claimant to produce a certificate from the concerned supplier, to the effect that said supplies had actually been made by him to the said registered person and the tax on said supplies had been paid by the said supplier in his return in FORM GSTR 3B. 8.13.4 Law Committee had recommended issuance of a Circular for detailing the procedure for verification of ITC availed by the registered persons in such cases and for providing clarity to the trade and....
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....T DRC-25 by Commissioner under Section 161 of CGST Rules, 2017 for reducing the said dues. Law Committee also recommended amendment in Rule 161 to align the same with Section 84 of the CGST Act, 2017 and also recommended that FORM GST DRC-25 be amended, to specifically include the authorities under IBC in the said form. The Council agreed with the recommendation of the Law Committee. 8.15 Agenda Item 7(xv): Amendment in provisions related to OIDAR Services under the IGST Act, 2017. 8.15.1 Principal Commissioner, GST Policy Wing presented the Agenda item before the Council and stated OIDAR services are digitally supplied services, the nature of which renders their supply impossible in the absence of Information Technology. With the growth of digital economy, the OIDAR services are expected to grow immensely in volume and accordingly, more measures would be required to be taken in due course for improving compliance under GST for OIDAR services supplied by persons located in non-taxable territory. 8.15.2 To ensure compliance under GST by OIDAR service providers, the Law Committee opined that amendments were required in existing provisions of law so as to red....
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.... for the purposes of business or profession. 8.16.2 Law Committee had recommended that ITC in respect of CSR expenditure incurred by Companies under section 135 of Companies Act may not be allowed. Further, it recommended that to unambiguously state such position, such CSR expenditure may be included in the list of blocked credits under Section 17(5) of the CGST Act, 2017. The Council agreed with the recommendation of the Law Committee. 8.17 Agenda Item 7(xvii): Issues related to place of supply in terms of the proviso to Section 12(8) of the IGST Act, 2017. 8.17.1 Principal Commissioner, GST Policy Wing presented the agenda item before the Council and stated that Place of supply (PoS) of services by way of transportation of goods, including by mail or courier, where location of supplier and recipient is in India, is specified in Section 12(8) of the IGST Act, 2017. Further, Proviso to the section 12(8), inserted w.e.f. 01.02.2019, provides that where the transportation of goods is to a place outside India, the PoS shall be the place of destination of such goods, i.e. foreign country. Accordingly, IGST would be payable on the said supply. As the PoS....
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....hat the GST data would be shared among the Centre/State Departments and agencies. 9.7. The Hon'ble Member from Puducherry raised concerns about the leakage of GST Data in case the same was shared with multiple departments and agencies. 9.8 The Hon'ble Chairperson clarified that the GST data sharing would be with State and Central Government Departments and their agencies only. 9.9 The Hon'ble Member from Andhra Pradesh supported sharing of GST data base but requested for sharing of other data base from Income Tax Department, Customs and NHAI Toll Data base. 9.10 The Hon'ble Chairperson clarified that GST Council had authority to share State/Centre GST data but the data sharing of Income Tax and Customs was outside the purview of Council. 9.11 The Hon'ble Member from Delhi stated that both the Centre and State were performing survey and investigations. In situations when any investigation is going on in one state for example in Uttar Pradesh and any lead related to other states like Delhi emerges from that investigation, then this data might be shared between the States through GSTN. There should be a mechanism in GSTN that such refe....
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....Shri Rajeev Rai Bhatnagar Lieutenant Governor, UT of 11 Jharkhand Dr Rameshwar Oraon J&K Minister for Planning cum Finance, Commercial Taxes and Food, Public Distribution and Consumer Affairs Chief Minister CHAIRMAN'S 12 Karnataka Shri Basavaraj Bommai INITIALS Page 50 of 131 Shipra Shipra MINUTE BOOK 13 Kerala Shri K N Balagopal 14 Madhya Pradesh Shri Jagdish Devda 15 Maharashtra Shri Devendra Fadnavis 16 Manipur Dr. Sapam Ranjan Singh 17 Meghalaya Shri James K Sangma 18 Odisha Shri Niranjan Pujari 19 Punjab Finance Minister Minister for Finance, Commercial Tax, Planning and Statistics Deputy Chief Minister Minister for Medical, Health & Family Welfare Department and Publicity & Information Department Taxation Minister Finance and Parliamentary Affairs Minister Finance Minister 20 20 Puducherry 21 Rajasthan 22 Sikkim Shri Harpal Singh Cheema Shri. K. Lakshminarayanan Shri Shanti Kumar Dhariwal Shri B. S. Panth 23 Tamil Nadu Dr.Palanivel Thiaga Rajan 24 Telangana ....
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....t Secretary 17 Government of India Shri S.S. Nakul PS to FM 18 Government of India Shri Deepak Kapoor OSD to Revenue Secretary 19 Government of India Shri D. P. Misra OSD to Chairman, CBIC 20 Government of India Dr Puneeta Bedi Additional Commissioner 21 Government of India Shri Alok Kumar Additional Commissioner 22 Government of India Shri Pramod Kumar Director 23 Government of India Shri Rakesh Dahiya Deputy Secretary 24 Government of India Ms. Amreeta Titus Deputy Secretary 25 Government of India Shri Nitesh Gupta Deputy Commissioner 26 Government of India Ms. Rajni Sharma Deputy Commissioner 27 Government of India Shri Amit Samdariya At Deputy Commissioner Page 53 of 131 CHAIRMAN'S INITIALS MINUTE BOOK 28 Government of India Ms. Neha Yadav 29 29 Deputy Commissioner Government of India Shri Rahul Kumar Under Secretary 30 Government of India Shri Rajeev Ranjan Under Secretary 31 Government of India Shri Gaurav Shukla Under Secretary 32 Government of India Ms. Smita Roy T....
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....r, State Tax (Commercial Tax) 62 62 Chhattisgarh Shri T.L. Dhruw Additional Commissioner of State Tax 63 Delhi Shri Ashish Chandra Verma Pr. Secretary Finance and Secretary to Deputy Chief Minister 64 Delhi Dr. S. B. Deepak Commissioner DT & T 65 555 Delhi Shri. Awanish Kumar Special Commissioner DT & T 99 66 Goa Ms. Sarita Gadgil Additional Commissioner of State Tax 67 67 Goa Shri Saba Krishna Parab Nodal Officer GST 68 Gujarat Shri. J.P. Gupta Principal Secretary, Finance Department 69 Gujarat Shri. Milind Torawane Chief Commissioner of State Tax 70 70 Gujarat Shri Dilip Thaker Deputy Secretary(Tax) 71 Gujarat Shri Milind Kavatkar Joint Commissioner (Legal) 72 12 Haryana Shri Anurag Rastogi Addl. Chief Secretary to Government, Excise and Page 56 of 131 Taxation Department. Shipra Shipra MINUTE BOOK 73 Haryana Shri Ashok Kumar Meena 74 Haryana Shri Siddharth Jain 75 Himachal Pradesh Shri Subhasish Panda 76 Himachal Pradesh Shri Yunus 77 Himachal....
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....retary, Excise, Registration, Taxation and Stamp Department Additional Commissioner of State Taxes Shipra Shipra - MINUTE BOOK 103 Meghalaya Shri. B Wahlang Deputy Commissioner of State Taxes 104 Meghalaya Shri. JL Kharwanlang Assistant Commissioner of Taxes 105 Meghalaya Shri MC Sangma Assistant Commissioner of Taxes 106 Meghalaya Shri. V R Challam Assistant Commissioner of Taxes 107 Meghalaya Shri. M K Phanbuh Assistant Commissioner of Taxes 108 Meghalaya Shri. Tryster Sangma Superintendent 109 Meghalaya Shri. Bhuto Marak Superintendent 110 Mizoram Shri Vanlal Chhuanga Principal Secretary, Taxation Department 111 Mizoram Shri R. Zosiamliana Additional Commissioner of State Taxes 112 Mizoram Shri Hrangthanmawia Assistant Commissioner of Taxes 113 Nagaland Shri. C Lima Imsong Additional Commissioner of State Taxes 114 Nagaland Ms. N Areni Patton Joint Commissioner of State Tax 115 Odisha Shri Sanjay Kumar Singh Commercial Tax and GST Commissioner of 116 Punjab Shri A....
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....ner of State Taxes 143 Uttarakhand Shri S.S. Tiruwa Deputy Commissioner of State Taxes Assistant Commissioner 144 Uttarakhand Shri Ranjit Singh of State Taxes 145 Uttar Pradesh Shri Nitin Ramesh Gokaran 146 Uttar Pradesh Ms. Ministhy S Page 61 of 131 Principal Secretary, State Tax Commissioner of State Tax CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK 147 Uttar Pradesh Shri Harilal Prajapati 148 Uttar Pradesh 149 West Bengal Shri Paritosh Kumar Mishra Shri Rajib Sankar Sengupta Joint Commissioner(GST), State Tax HQ Deputy Commissioner(GST), State Tax HQ Senior Joint Commissioner of State Taxes 150 West Bengal Shri Joyjit Banik Senior Joint Commissioner of State Taxes 151 West Bengal Shri Barun Gayen Assistant Commissioner of State Taxes 152 West Bengal Shri Shantanu Naha OSD to Minister Page 62 of 131 Shipra Document 3 Shipra MINUTE BOOK Annexure-3 Recommendations of Fitment Committee on Goods and Services (Agenda item 3) 48th GST Council Meeting 17th December 2....
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.... intervening period on "as is" basis from the date of issuance of last circular (3.08.2022) on account of genuine doubts. CHAIRMAN'S INITIALS Page 65 of 131 MINUTE BOOK Agenda 3(a) (contd.) 3. Issue Clarification for applicability of higher rate of compensation cess of 22% on supply of SUV:(Volume 1, Pages 195-199) • The GST Council in its 21st Meeting held in Sept, 2017 had recommended a higher rate of compensation cess of 22% for SUV. "Sports Utility Vehicles(SUVs) (of length more than 4-metre, engine capacity more than 1500cc and ground clearance 170 mm): To increase the rate of cess from the present 15% to 22%." ⚫To clarify that the higher rate of compensation cess of 22% is applicable on motor vehicle fulfilling all four conditions, namely, it is popularly known as SUV, has engine capacity exceeding 1500 cc, length exceeding 4000 mm and ground clearance of 170 mm or above (entry 52B of notification no. 1/2017-CC). 4. RCM for Mentha arvensis : • To include Mentha arvensis supplied by unregistered person to registered person under RCM as has been done for Mentha Oil. Agenda 3(a) (contd.): 5. GST r....
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....leum operations: (Volume 1, Pages 201-202) Based on GoM report, 5% concessional rate of GST for goods of all chapters imported for petroleum operations was increased from 5% to 12% (Notification no. 3/2017-ITR) ⚫ However, certain goods including those used for petroleum operations attract 5% GST by virtue of their entry in Schedule I of notification no. 1/2017 of the ITR. • To clarify that if any goods imported for petroleum operations fall in specified list of goods eligible for 12% GST under notification no. 3/2017-ITR but are also eligible for a lower rate under Schedule I of notification no. 1/2017-CTR or any other notification, the importer may claim the lower rate. Agenda 3(a) (contd.) 9. Extend GST rate of 5% on ethanol supplied for blending with Motor Spirit to petroleum refineries: (Volume 1, Pages 202-203) ⚫In line with the National Policy on Biofuels - 2018, to promote blending, concessional GST rate of 5% on ethyl alcohol has already been provided to Oil Marketing Companies (OMCs) like IOCL, BPCL and HPCL for blending with Motor Spirit (petrol) under Schedule I of Notification No. 1/2017- Central Tax ....
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.... Entry 23A of Notification No. 12/2017-CTR exempts services, by way of providing access to a road or a bridge, against consideration in the form of annuity. • Based on recommendations of the 43rd GST Council, it was clarified that entry 23A of said notification does not exempt GST on the annuity (deferred payments) paid for construction of roads. However, the Hon'ble Karnataka High Court has held that entry 23A of said notification covers services of construction of road where consideration is paid in the form of annuity. • Access to road or bridge is allowed against consideration in the form of toll which is already exempt under entry at Sr. No. 23. ⚫Entry 23A may be omitted to prevent its misuse. Agenda 3(d) (contd.) 3. Taxability of revenue apportioned by Indian Railways (IR) to Special Purpose Vehicles (SPVs) and O&M costs charged by Indian Railways from SPVs: (Volume 1 Page no 213) • Indian Railways and the SPV are distinct persons. Supply of services by SPV to Indian Railways by way of allowing Indian Railways to use infrastructure built and owned by them during the concession period against considerat....
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....17) • As recommended by 47th GST Council, renting of residential dwelling to a business entity for use of its employees etc. has been made taxable and the present entry in the notification reads as under "Services by way of renting of residential dwelling for use as residence except where the residential dwelling is rented to a registered person". • An issue has arisen whether GST would be payable on renting of a residential dwelling by the proprietor of a proprietorship firm in his personal capacity for use as his residence when the firm is a registered person. • Where the residential dwelling is rented by a person who is the proprietor of a proprietorship firm who rents it in his personal capacity for use as his own residential dwelling, (and such renting is not on account of its business, i.e., not accounted for in the books of account of the firm but is on personal account) the exemption should be available to him. Agenda 3(d) (contd.) • To avoid litigation on this matter, it is proposed that the entry at Sr. no. 12 of notification no. 12/2017-CTR be amended as An explanation may be inserted that if a re....
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....ic parks and garden, burial ground and crematorium 5. Renting of motor vehicles for carrying out functions listed at Sr. No. 1 to 4 above; 6. Supply of manpower service for carrying out functions listed at Sr. No. 1 to 4 above Agenda 3(d) (contd.) ⚫ Views were sought from the States of Telangana, Andhra Pradesh and Delhi, as per decision of 47th GST Council meeting. • Based on the inputs from the states, the following positive list of services is proposed to be specified in in Sl. No. 3 and 3A of notification No. 12/2017-CTR as follows: 1. Water treatment and/or supply; 2. Public Health activities, Sanitation Conservancy and Solid or Liquid Waste management; 3. Slum Improvement and Up gradation; 4. Maintenance and operation of street lights, bus stops, public conveniences, public parks and gardens, burial ground and crematorium; 5. Education, including primary and secondary schools; Page 75 of 131 CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Agenda 3(d) (contd.) 6. Technical training and vocational education; 7. Adult and non-formal education; 8. Libraries; 9. Social Forestry and Farm....
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.... 77 of 131 MINUTE BOOK . Agenda 3(e)(contd.) Proposal for granting exemption to the services supplied by electricity transmission utilities by way of construction and erection of transmission assets for providing power supply to the pump houses which are constructed under a Lift Irrigation Scheme (LIS). • To remove exemption limits on renting of premises by a religious/charitable trust. • Formulating a Margin Scheme for Tour Operators in consultation with stakeholders. • GST on economy class fare may be increased to 12% and on business class to 18% provided ATF is brought under ambit of GST. • To bring parity between express and transport sector. • To exempt GST on All India Permit fee paid for grant of authorization or permit for plying Tourist Vehicles throughout India w.e.f 01.04.2021. Agenda 3(f): Issues deferred for further examination (volume 1, page no 257-260) Committee deferred following issues for further examination: ⚫ To notify a mechanism for availment of ITC where AC bus services are supplied through e-commerce operator (ECO) or to shift the onus of discharging GST on the regis....
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....itory Tax Notifications issued (No. 03/2022 to 04/2022) & Nine (09) Union Territory Tax (rate) Notifications issued (No. 03/2022 to 11/2022) 4 amendments to CGST Rules carried out, notifications to implement various decisions of GST Council taken in 47th meeting & to implement other GIC decisions. Some of the important decisions are: i. To notify the provisions of the Finance Act, 2022. ii. To exempt taxpayers having AATO upto Rs. 2 crores from the requirement of furnishing annual return for FY 2021-22. iii. To extend due date of furnishing FORM GST CMP-08 for the quarter ending June, 2022 till 31.07.2022. iv. To extend the waiver of late fee for delay in filing FORM GSTR-4 for FY 2021-22. v. To extend dates of specified compliances in exercise of powers under section 168A of CGST Act. vi. To implement e-invoicing for the taxpayers having aggregate tumover exceeding Rs. 10 Crore from 1st October, 2022. vii. To empower the Competition Commission of India to handle anti- profiteering cases under CGST Act, 2017 w.e.f. 01.12.2022. Notifications to implement various decisions of GST Council taken in 47th meeting ....
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....ng/revising TRAN-1/TRAN-2 in terms of order dated 22.07.2022 & 02.09.2022 of Hon'ble Supreme Court in the case of Union of India vs. Filco Trade Centre Pvt. Ltd. Issuance of guidelines for verifying the Transitional Credit in light of the order of the Hon'ble Supreme Court in the Union of India vs. Filco Trade Centre Pvt. Ltd., SLP(C) No. 32709-32710/2018, order dated 22.07.2022 & 02.09.2022. Notifying the provisions of Finance Act, 2022 and consequential amendment of CGST Rules, 2017. 4 To settle IGST amount of Rs. 22.000 crores for the Financial Year 2022-23 on ad-hoc basis. " B " " Extension of the due date for filing FORM GSTR-3B for the month of September, 2022. by registered person from 20th October, 2022 to 21st October, 2022. Amendment in instructions to FORM GSTR-9. Issuance of clarification regarding the issues relating to refund of umutilised ITC on account of inverted rated structure. To empower the Competition Commission of India to handle anti-profiteering cases under CGST Act, 2017 w.e.f. 01.12.2022 (as per decision of GST Council in 45th meeting). Extension of due date of filing FORM GSTR-1 for month of Novemb....
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.... GST is a discount given by insurance companies on the premium payable by the customer/insured for a particular year, if the insured has not made any claim during the previous year. Some field formations investigation agencies are treating NCB as a supply by the customer to the insurance company. Doubts are being raised as to whether " NCB is a consideration paid to the customer by the insurer for agreeing to the obligation to refrain from the act of lodging insurance claim during the policy period and therefore tax is payable by the insurance company on the gross amount without deducting NCB from the premium amount, or Alternatively, whether it should be treated as a discount by insurance company, to be deducted from the gross premium, for the purpose of calculation of value of supply made by insurer to the insured. " Proposal: â–LC has recommended that it may be clarified through a circular that NCB is not a consideration in respect of any service rendered by the insured to the insurance company, rather it is an upfront discount from the premium payable by the insured for the supply of insurance services by the insurance company t....
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.... 132(1) of CGST Act is Rs One Crore. However, as per section 69 of CGST Act, arrest for offences under GST can be made only in cases involving minimum amount of tax evaded of Rs Two crore. It is felt that that the provisions of prosecution under GST need to be reviewed so as to align the threshold for prosecution with the threshold of arrest, and also to review some of the offences to decriminalize them. There is also a need to review provisions of compounding of offences under section 138 of CGST Act to make compounding provisions more attractive. ж Page 91 of 131 CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(iii): Decriminalization of CGST Act, 2017(2/2) Proposal: LC recommended the following: [Vol 1- Pg. 297-303] ■Deletion of the offences mentioned in clause (g), (j) and (k) of sub-section (1) of section 132 of CGST Act and consequential amendment in clause (/) of sub-section (1) and clause (iv) of sub- section (1) of section 132 of CGST Act. The minimum threshold for launching prosecution to be increased to Rs two crore from the current Rs one crore and accordingly, the clause (iii) of sub-section (1) of Sectio....
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....ms of proviso to section 12(8) â– PoS is to be declared in FORM GSTR-1 on the common portal under the state code "96- Foreign Country" (and not under "97-Other Tenitory"). LC has also recommended for omission of the proviso to section 12(8) of IGST Act, 2017, as no useful purpose is being served by the proviso to section 12(8) of IGST Act. 2017 inserted w.e.f. 01.02.2019. > This would provide clarity to the trade and field formations and remove ambiguities on the issue. Page 93 of 131 2 CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(xiii): Clarification for treatment of the difference in ITC availed in GSTR-3B vis a vis that available in GSTR-2A for FY 2017-18 and 2018-19 [Vol 1- Pg. 385-390] Issue: During the initial period of implementation of GST, especially during the financial years 2017-18 and 2018-19, many suppliers failed to furnish the correct details of outward supplies in their FORM GSTR-1. Because of such discrepancies. FORM GSTR-2A of their recipients remained incomplete. However, the concerned recipients may have availed input tax credit on the said supplies in their returns in FORM GSTR-3B, as restrictions in av....
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....š« in case the govemment dues under CGST Act are extinguished or reckiced in IBC proceedings, an intimation may be issued by Commissioner under section 161 of CGST Rules for reducing the said dues. â– amendment to Rule 161 of CGST Rules to align the same with Section 84 of CGST Act and amendment to FORM GST DRC 25 to specifically include the authorities under IBC. This would provide clarity to the trade and field formations on the issue. Page 95 of 131 ох CHAIRMAN'S INITIALS CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(x):: Retrospective applicability of para 7, 8(a) and 8(b) of Schedule III of CGST Act (1/2) [Vol 1-Pg. 365-373] Issue Para 7, para 8(a) and para 8(b) were inserted in Schedule III of the CGST Act vide CGST (Amendment) Act, 2018 and were made applicable vide Notification No. 02/2019-Central Tax dated 29.01.2019 with effect from 01.02.2019, to provide that: â– supply of goods from a place in the non-taxable territory to another place in the non- taxable territory without such goods entering into India, is an activity which is to be treated as neither supply of goods or services - para 7 sup....
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....ions during the period 01.07.2017 to 31.01.2019. CHAIRMAN'S INITIALS Page 97 of 131 CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(vii): Supplies by unregistered person and composition dealers through e-commerce operators (1/2) [Vol 1-Pg 335-343] Issue: GST Council in its 47th meeting gave in-principle approval for the following relaxations for suppliers making supplies through E-Commerce Operators (ECOs): â– Waiver of requirement of mandatory registration under section 24(ix) of CGST Act for person supplying goods through ECOS. subject to certain conditions, such as, aggregate fumover not exceeding the turnover specified under section 22(1) of the CGST Act and notifications issued thereunder, and the said person not making any inter-State taxable supply. " Composition taxpayers to be allowed to make intra-State supply through ECOS subject to certain conditions. â– The details of the scheme to be worked out by the Law Committee. The scheme to be tentatively implemented with effect from 01.01.2023, subject to preparedness on the portal as well as by ECOS. Proposal: LC has recommended that: âš« in respect ....
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.... of MSMEs, thus facilitating trade. CHAIRMAN'S INITIALS Page 99 of 131 MINUTE BOOK Agenda 7(vi): Proposal for amendments to CGST Rules, 2017 (1/11) [Vol 1- Pg. 319-320] Amendment of Rule 87 of CGST Rules 2017: On payment of taxes by taxpayers through e-payment mode, the banks generate CIN for each payment and send the same to GST System, based on which GST System updates payment in Electronic Cash Ledger (ECL) of the taxpayer. In a few cases, the bank fails to share CIN details with GST System, but may share the CIN details and payment of such transaction with RBI subsequently. RBI after reconciliation of payment with CINS received from the banks, shares such transaction details with GST System and ECL of such taxpayers are updated by GST system based on e-Scroll of RBI. There is, however, no provision in GST law presently providing for such updation of ECL of taxpayers in such cases based on e-Scroll of RBI. LC recommended insertion of a new proviso to sub-rule (8) of Rule 87 in CGST Rules, 2017 to provide for the process of updating ECL on the portal on the basis of e-Scroll data received from the RBI in cases, where ....
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.... recommended to ⚫ insert Rule 109C in CGST Rules, 2017 to provide for withdrawal of appeal. ■introduce FORM GST APL-01/03W in CGST Rules, 2017, to enable the appellant to file application for withdrawal of appeal application. > This will reduce litigation at the level of appellate authorities by allowing the appellants to withdraw their appeal upto a specified stage. Page 102 of 131 Shipra Shipra MINUTE BOOK Agenda 7(vi): Proposal for amendments to CGST Rules, 2017 (4/11) [Vol 1- Pg. 320-323] Amendment in Rule 108 and rule 109: ܀ Sub-rule (3) of rule 108 and sub-rule (2) of rule 109 of the CGST Rules mandate submission of a certified copy of the decision or order appealed against within seven days of filing the appeal in FORM GST APL-01/ FORM GST APL-03. On receipt of such certified copy, the appellate authority is required to issue a final acknowledgment in FORM GST APL-02. ✰ Doubts are being raised on the requirement of submission of a certified copy of the decision or order appealed against for admissibility of appeal by an Appellate Authority. LC observed that: When the copy of the order, w....
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.... (6/11) [Vol 1- Pg. 313-314] Amendment in sub-rule (3) of rule 12 of CGST Rules: Rule 12 of CGST Rules provides for procedure for registration and cancellation of registration of Electronic Commerce Operators (required to collect TCS under section 52) and the persons, who are required to deduct tax under section 51 of CGST Act. Though rule 12(3) provides for cancellation of such registration by proper officer, but there is no mechanism for the said person to apply for cancellation himself. LC recommended that sub-rule (3) of rule 12 of CGST rules may be amended to provide for an option to the TCS and TDS operators to apply for cancellation of their registration. ➤ This amendment would provide facility for cancellation of registration to TDS and TCS operators. CHAIRMAN'S INITIALS Page 105 of 131 CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(vi): Proposal for amendments to CGST Rules, 2017 (7/11) [Vol 1-Pg. 314-316] Amendment in rule 37: 2nd proviso to section 16(2) of the CGST Act provides for payment of amount of ITC if the payment towards the value of supply along with tax payable is not made by the recip....
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....hall be reversed by the registered person in a return in FORM GSTR-3B on or before 30th November of the next financial year. failing which such amount shall be payable along with interest under section 50. â– The registered person can re-avail the said credit in a subsequent return in FORM GSTR-3B when the concerned supplier files his return in FORM GSTR-3B for the corresponding tax period of the said invoice. This amendment would ease the process for complying with the condition for availment of ITC under section 16(2)(c) of CGST Act and thus facilitate a large number of taxpayers. Page 107 of 131 A\ CHAIRMAN'S INITIALS MINUTE BOOK Agenda 7(vi): Proposal for amendments to CGST Rules, 2017 (9/11) [Vol 1- Pg. 326-327] Deletion of clause (d) of sub-rule (14) of rule 138: E-way bill is not required to be generated for intra-state movement of goods where the consignment value of goods being transported is less than the threshold value as notified by the respective Commissioner of State Tax as per the provisions of clause (d) of sub-rule (14) of the rule 138 of the respective SGST or UTGST Rules. Consequently, different....
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....(f) of rule 46 provides that in case of supply by a registered person to an unregistered recipient with value of taxable supply being less than Rs 50,000/-, tax invoice shall contain the name and address of the recipient and the address of delivery. along with the name of the State and its code. if such recipient requests that such details be recorded on the tax invoice. Sub-section (2) of section 12 of the IGST Act provides that the place of supply of services made to an unregistered person shall be the location of the recipient, where the address on record exists, and the location of the supplier of services, in other cases. LC recommended insertion of proviso in clause (f) of rule 46 to provide for mandatory recording of address of unregistered recipients of services, along with PIN code, when the said services are provided through the online platform by a registered person, even if value of taxable supply is less than Rs 50,000/- Amendment to rule 46A: Rule 46A of the CGST/SGST Rules provides that, notwithstanding anything contained in rule 46 or rule 49 or rule 54, a registered person supplying taxable as well as exempted goods or services o....
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....t of complete application of refund There are cases where the payment of refund to the applicant gets delayed due to the reasons attributable to the applicant. There is a need to exclude this amount of delay, attributable to the applicant, from the period for payment of interest on delayed refunds. CAG has also made a recommendation in the matter in its report No. 5 of 2022, as below: "The provisions regarding payment of interest on delayed refunds need to be amended to exclude the period of delays that is attributable to the taxpayers such as delay in reply to SCN or incorrect bank details for payment." Proposal LC recommended the following: To make an amendment in section 56 of the CGST Act to provide for prescribing the manner of computation of period of delay for calculation of interest payable on delayed refund in CGST Rules. â– To make an amendment in rule 94 of the CGST Rules to provide for exclusion of period of delay attributable to taxpayer for computation of time period of delay for payment of interest on delayed refunds. This will ensure that interest is not required to be paid on delayed refunds if the delay is due to....
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....ssue 2: Incorporation of details of electricity bill and property registration in FORM GST REG-01 The Group of Ministers on GST System Reforms also approved the proposal for inclusion of Electricity Bill Meta data (CA No.) as a data field during registration by new taxpayers. CA Number shall be verified to improve the quality of registered addresses in GST System. The State of Maharashtra agreed to carry out the pilot project in this regard. The State of Madhya Pradesh also volunteered for the same as well as for the validation of property registration details from Land Revenue Department and Urban Administration Department. Proposal: LChas recommended that- B Details of electricity consumer account number (CA Number) and Property registration may be sought under State Specific Information at S. No. 24 of FORM GST REG-01. Details of Electricity CA Number may be notified under S. No. 24 by the State of Maharashtra. Details of Electricity CA Number and Property registration may be notified under S. No. 24 by the State of Madhya Pradesh. CHAIRMAN'S INITIALS Page 115 of 131 MINUTE BOOK Agenda 7(i): Biometric-based Aadhaar authent....
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....ertain cases. Section 23 provides for persons not liable for registration and exemption of specified categories of persons from obtaining registration. Existing section 23 does not have any clause overriding the registration requirement imposed vide section 24 and section 22(1), creating doubts whether section 23 prevails over section 24 and 22(1) or not. Proposal: LC has recommended that to avoid any conflict within the said provisions and to provide more clarity. section 23 of CGST Act may be amended retrospectively w.ef. 01.07.2017 to provide section 23 an overriding effect over sections 22(1) & 24 of CGST Act. CHAIRMAN'S INITIALS Page 117 of 131 MINUTE BOOK Agenda 7(viii): Proposal for amendments in the CGST Act(2/3) [Vol 1- Pg. 345-346] Issue 3: Amendments in CGST Act, 2017 to restrict filing of returns / statements after completion of specified time in view of data archival policy Huge data size is putting an excessive load on the server of GST system and compromising performance. Keeping massive data available online slows down the GST system applications and impacts return filing, especially during peak filing days. ....
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....stered person through ECO, on which ECO is required to pay tax under sub-section (5) of section 9 of CGST Act, are required to be reported by both the registered person as well as ECO in their respective returns in FORM GSTR-3B ܀ ➤ However, there is no separate table in FORM GSTR-1 to furnish details of the aforementioned details. Proposal: ܀ LC has recommended certain changes in FORM GSTR-1 to provide for reporting of supplies made through ECO by the supplier in respect of section 52 and section 9(5) supplies as well as by ECO in respect of section 9(5) supplies. This proposal would ensure correct reporting and matching of supplies made through ECOS under section 52 of CGST Act as well under section 9(5) of CGST Act. Page 120 of 131 Shipra MINUTE BOOK Shipra Agenda 7(xi): Manner of dealing with difference in liability reported in statement of outward supplies and that reported in return (1/2) [Vol 1- Pg. 374-377] 1 Issue: Law Committee deliberated upon ways to safeguard revenue by finding suitable manner of handling and controlling the difference in liabilities reported between FORM GSTR-1 and FOR....
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....differential amount or explain the reasons for the same, without intervention of tax officers. Page 122 of 131 Shipra Shipra MINUTE BOOK Agenda 7(xvi): Amendment of section 17 of CGST Act regarding ITC in respect of CSR (Corporate Social Responsibility) expenditure Issue: [Vol 1-Pg. 402-405] ✰ Doubts have been raised by trade as well field formations in respect of availability of input tax credit on CSR expenditure incurred by companies in accordance with the provisions of Companies Act, 2013 due to various contradictory advance rulings. ܀ One view is that CSR expenditure is incurred to meet the obligations under section 135 (5) of the Companies Act, and non-compliance on this count attracts penal action. Accordingly, input tax credit should be available in respect of inputs and input services for CSR activities in terms of section 16(1) of CGST Act. However, another view is that CSR does not include activities undertaken in pursuance of nommal course of business of the company and input tax credit may not be available to the registered person on CSR expenditure under section 16(1) of CGST Act. Explanation 2 to secti....
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.... MINUTE BOOK THANK YOU Page 125 of 131 CHAIRMAN'S INITIALS Document 6 CHAIRMAN'S INITIALS MINUTE BOOK STC GOODS AND SERVICES TAX COUNCIL Annexure-5 Agenda Item: Report of the committee on Levy of penal interest on delayed remittances of GST by the Banks to the Government Accounts in RBI during the initial period of GST implementation CONTENTS STC GOODS AND SETvices Background OIssue Constitution of Committee Proceedings of Committee Recommendation of Committee Views of States Page 126 of 131 EAR COUNCE Shipra Shipra MINUTE BOOK Background 25 banks (21 Public Sector Banks and 04 Private Sector Banks) were authorized to collect GST on behalf of Government of India. Principal Chief Controller of Accounts, CBIC is designated as Chief Accounting Authority (CAA) for the purpose of accounting & reporting of Central Goods & Services Tax (GST). . • The Business Logic and Workflow Designs for the authorized banks are duly documented by CAA in the form of detailed document called BARM (Banking Authorization Reference Model) It stipulates that IT systems of the banks should be....
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....PI/CBIC/GBA/194-200 dated 08.02.2019 comprising the following members to examine the requests of the banks and to decide on the issue of waiver of penal interest Custraler Gevel of Mishery of Plance Departments E Bock, INA, New Delh Ema No. 5-118123CHCGRA/1-20 Offer Meta paring the al pred of GST C As the "ting of Ae Can Grofting O e CA, CC of Principal Chief Controller of Accounts Central Board of indirect Taxes and Custo Join Control General of Accents (GBA O COA Dyskr Carmen Member Proceedings of Committee The Committee had held three meetings as under: 1st Meeting was held on 12th March, 2019 2nd Meeting was held on 10th April, 2019 3rd Meeting was held on 11th June, 2019 Page 128 of 131 PCCA, CIC, New De CORAL O me CCA, Cone Pey Wag Calc, Depannent of D Otal Man, DBA, KBL Man Cher Canal Mg (fndia New De STC 516 GOODS AND SERVICE TAX COUNC Shipra Shipra MINUTE BOOK Recommendations of Committee: Challenges faced by the banks:- That remittance of funds could not be made timely as the IT system and the integration process was not robust initially. Failures ....