*Some Key GST Points From FAQ*-
1. Would *head offices providing centralized HR, Finance and IT functions* also need to raise invoices to its branch- Yes, if the head office and branches are distinct persons as specified in section 25(4), invoice is required to be issued and GST should also be paid.
2. Where *free replacement is provided to the customers without consideration under warranty*, no GST is chargeable on such replacement. In such cases goods may be sent on delivery challan as provided in rule 55 of the CGST Rule, 2017
3. How the *invoicing should be done for free goods given along with sale* so that corresponding input tax credit is not required to be reversed for products under scheme?- Invoice value would include value of all goods including those supplied free. In such cases, ITC is not required to be reversed
4. How to *send demonstration equipment and instruments to customers or branch offices* with in India on returnable basis? – No sale is involved- As the goods are sent on returnable basis and no transfer of title is involved, it is not a supply of goods. If some element of service is involved, the same will be a taxable supply. The goods may be sent on delivery challan without invoice as it is not a supply of goods.
5. How to *send equipment and instruments to manufacturers’ factory for repairs and calibration* with in India on returnable basis? – No sale is involved.- Challan for movement of goods without supply is to be issued in terms of Rule 55 of CGST Rules.
6. *Mistakes done in GSTR Returns can be corrected in subsequent returns* to be filed through amendment Table (For example Table 11 of GSTR-1). Such mistakes can be corrected till the due date for filing of the return for the month of September subsequent to end of the year or filing of the annual return, whichever is earlier.
7. No ITC is permitted to GTA engaged in providing GTA services which are under RCM and are treated as exempted supplies in the hand of GTA. However, if *GTA is also liable to pay tax under forward charge* as supplier, he is not permitted to avail ITC if he is claiming the concessional rate of 5%. If ITC is claimed, the GST rate for GTA in forward charge will be 12%.
8. The *compensation to employees in the form of money* is not a supply. However, fringe benefits are supply of goods or services and are liable to tax if not exempted. These are transactions in furtherance of business and even if supplied without consideration, the same are deemed supply
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📺 *Updates*
➡1. NCLT dismissed oppression plea as disputes related to forgery and had to be decided in criminal court
Atmaram B. Agarwal v. Supriya Prints (P.) Ltd.
➡2. CBEC directed officers to follow legal provisions during physically verification of premises
➡3. Statement of undisclosed income recorded after date of search couldn’t be said to have evidentiary value: HC.
Commissioner of Income-tax-II, Nagpur v. Shankarlal Bhagwatiprasad Jalan
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No IT Deduction If Assessee purchases Another entities’ Business Unit including plant & Machinery to Form a Separate Industrial Undertaking: Allahabad HC
Read more at: http://www.taxscan.in/no-deduction-assessee-purchases-another-entities-business-unit-including-plant-machinery-form-separate-industrial-undertaking-allahabad-hc/10968/
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*Works Contract to become cheaper*
*GST rate slashed to 12% from 18% on construction services provided to Govt or other authorities*
AT the 21st meeting the GST Council recommended, to reduce tax rate from 18% to 12% on serveral services provided to the Governments, a local authority or a government authority by way of *construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of* –
(a) a civil structure or any other original works meant predominantly for use other than for commerce, industry, or any other business or profession;
(b) a structure meant predominantly for use as (i) an educational, (ii) a clinical, or(iii) an art or cultural establishment; or
(c) a residential complex predominantly meant for self-use or the use of their employees or other persons specified in paragraph 3 of the Schedule III of the CGST Act, 2017 (namely, MPs/Members of State Legislatures, Panchayats, Municipalities, other local authorities, persons holding constitutional posts, chairperson/member/director in a body established by Central Government, State Government or local authorities etc.).
- to exempt services by way of admission to FIFA U-17 Football World Cup- 2017 events from GST
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#Economy:With slowing of luxury housing property sales, major real estate developers are banking on their affordable and premium segments for the coming months.They’re still bearing the brunt of demonetisation, plus the impact of the RERA and the GST. As a result of these, say developers, the luxury residential market is going through consolidation and slowdown. Once that phase is over, they hope, wealthy individuals would again start spending on luxury properties.
#Every district of the country will soon have at least one trained personnel to assist small taxpayers in filing ITRs, with the I-Tax Dept proposing to appoint 7,600 additional experts whose services will also be available on mobile application.The CBDT, the apex policy-making body of the tax department, has decided to enlarge the ambit of the 2006 Tax Return Preparer Scheme (TRPS) by making the service "digital" and covering all the 708 districts of the country. It is proposed to provide sufficient number of TRPs in every district by scaling up of number of TRPs from a total 5,400 to 13,000 in the country.
#A photo of your shiny new luxury car on Instagram or a costly watch on Facebook may lead the taxman to your door as the tax department from next month will begin amassing virtual information to trace black money. Project Insight', likely to be launched next month, will use big data analytics to match information from social media sites to deduce mismatches between spending pattern and income declaration. The tax dept will analyse mismatches in income declarations and spending patterns to trace tax evasions and black money. The tax department had last year signed a pact with L&T Infotech for implementation of Project Insight, which is designed to strengthen the non-intrusive information driven approach for improving tax compliance.
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Key takeaways from 21st GST Council Meeting*
🗡The due date for filing GSTR-1, GSTR-2 and GSTR-3 has been extended to 10th October, 2017, 31st October, 2017 & 10th November, 2017 respectively;
🗡GSTR-3B to be filed for the months of August, 2017 to December, 2017;
🗡Composition scheme can be opted till 30th September, 2017;
🗡No registration required, where the inter state supply (upto 20 lakhs turnover) of handicraft goods made under the cover of e-way bill;
🗡No registration required, where the inter supply (upto 20 lakhs) of Job work services made to registered persons and goods moves under the cover of e-way bill;
🗡The due date of filing Form TRAN-1 has been extended till 31st October, 2017 and it can be revised once;
🗡Registration for TDS and TCS deductor, would be start from 18th September, 2017, however the date for deduction/collection of TDS/TCS would be notified later;
🗡GST council set up a committee to examine issues related to exports and also constitute a group of ministers to monitor and resolve the IT challenges faced during GST implementation.
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GST Council Outcome: Due Dates of GSTRs Extended, Persons Making Inter-State supplies of handicraft goods Exempted from Registration
Read more at: http://www.taxscan.in/gst-council-outcome-due-dates-gstrs-extended-persons-making-inter-state-supplies-handicraft-goods-exempted-registration/10949/
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Assessment in the Name of Company dissolved by Amalgamation is Void: Delhi HC [Read Order]
Read more at: http://www.taxscan.in/assessment-name-company-dissolved-amalgamation-void-delhi-hc/10962/
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Registration for TDS & TCS to be opened from 18th September: Govt
Read more at: http://www.taxscan.in/registration-tds-tcs-opened-18th-september-govt/10954/
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Limitation Not Applicable in Granting Refund of Tax Collected without Authority: CESTAT Chandigarh [Read Order]
Read more at: http://www.taxscan.in/limitation-not-applicable-granting-refund-tax-collected-without-authority-cestat-chandigarh/10902/
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Receiving Fee from Non-Members can’t be a Ground for Denying Exemption under section 11(1) of IT Act: ITAT Delhi [Read Order]
Read more at: http://www.taxscan.in/receiving-fee-non-members-cant-ground-denying-exemption-section-111-act-itat-delhi/10933/
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#Economy:The Govt is moving ahead with linking Aadhaar with mobile SIM cards and all unlinked phones will be deactivated after February 2018.The Aadhaar mobile linkage is being done as per the orders of Supreme Court passed in February this year in Lokniti foundation case and all SIM cards have to be verified with Aadhaar within a year from the date of judgement, with all unlinked phones to be deactivated after February next year, so criminals, fraudsters and terrorists cannot use the issued SIMs. The Govt had told Supreme Court that it would put in place, within a year, an effective mechanism for the verification of pre-paid mobile users who constitute 90% of the total subscribers.
#Finance:The Council cut rates on around 30 items of mass consumption such as batter for idli, dosa, incense sticks, plastic raincoats, and rubber band, some categories of handicrafts, khadi fabric sold from the Khadi Village and Industries Corporation has been exempted from the GST. A composition scheme, which allows those up to Rs 75 lakh of turnnover a year to opt for flat rate of GST, has been extended till September 30.
#The CBI has registered a case against 19 companies which have sent over Rs 424 crore in foreign remittances through about 700 transactions, suspecting it to be a case of money laundering through shell companies. It is alleged that during the year 2015, unidentified officials of PNB, Mint Street branch, Chennai, entered into a criminal conspiracy with 19 accused co's which were account holders in the branch. In furtherance of the conspiracy, the above said companies were sending foreign exchange to Hong Kong without any genuine business transactions.The modus operandi was that the customers got remittances from various other banks to their accounts by way of RTGS . The customer presented their request with a quotation issued by foreign suppliers for 100% advance remittances. The remittance amount was kept in such a way that it would not exceed the threshold limit of USD 1 lakh for each remittance in order to circumvent the regulatory requirements and applicability of the RBI. The bank had found that none of units were functioning at the available address.
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Summary of 21 meeting of the GST Council.
# Due date of GSTR1 for July extended to *October 10*. Confirmed by FinMin Arun Jaitley. New timetable is as follows.
- For registered persons with turnover in a state more than Rs. 100 crores, due date for GSTR-1 for July 2017 will be 03.10.2017
- For others, due date for GSTR - 1 July 2017 will be 10.10.2017
- GSTR-2 (for the month of July 2017) 31.10.2017
- GSTR-3 (for the month of July 2017) 10.11.2017
- GSTR-4 (for the quarter July-sep 2017) 18.10.2017
- GSTR-6 (for the month of July 2017) 13.10.2017
# Time table for next month to be announced later on
# *TRAN - 1 extended by 1 month*. Single revision option to be provided.
# *GSTR 3B* to be continued for 4 more months - *Sept, Oct, Nov and Dec*
# Window for *Composition option* to be re-opened. Due date 30th Sept.
# Inter-ministerial panel to be formed to look at the technical issues around GST Network to address issues pertaining to uploading of the returns on GSTN
# Council widens the definition of *'Brand'*. If product carries a trademark which is registered on 15.5.2017 or even if unregistered but mark/name allows exclusivity on account of any reason. Rate for branded goods reduced to 5% from 12%.
# No registration for inter-state sale upto Rs. 20 lakhs for artisans, folk artists, tribal art and for specified job work. Khadi sold through KVIC stores exempted.
# *Tax rates reviewed* and reduced for 30 items.
# Review of tax rates after 6 months if healthy collection continues.
# GST on Works Contract for Govt reduced to 12%
# No change in *Cess on Cars* with engines less than 1200cc petrol or 1500cc diesel. Cess on Mid segement cars increased by 2%. Cess on Large cars increased by 5%. Cess on SUV increased by 7%. No change for Hybrid cars.
# Despite robust collection of GST (Rs. 95000 Crore), on account of *unrealised IGST* (Rs. 37000 Crore), State Govts are facing liquidity issues.
# Officer's committee to be formed to look on *embedded taxes in exports*.
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*Labour Law Knowledge Capsule 5:*
Date: September 9, 2017
*Will non-payment of the remuneration to the Directors will amount to the non-compliance under Minimum Wages Act and Payment of Wages Act?*
Lot of the start-ups and newly incorporated companies have started waiving off the rights of the remuneration to be paid to the Directors, due to non-availability of the funds with the company. Many a times, promoter directors are not willing to take the salary and infuse the funds in the expansion of the business. Companies Act, 2013 have not expressed any provision for company or director to waive off the receipt of the salary, but due to non-availability of the funds, the same can be done by the director.
*Question arise whether the same will lead to non-compliance under Minimum Wages Act and Payment of Wages Act?*
Both the said Act expressly define “employer” and that the Promoter Directors gets classified as employer under the Act and that the said Act get out of the ambit for the promoter directors as they are the owner of the business, but definition of “employer” will not cover all the Director under its shelter. Further, intent of the Labour Law is to cover the employees and workers, so will it cover the other directors under its ambit?
*Giving example of the judgement of Punjab & Haryana High Court,* in the matter of ESIC, even Managing Director and other Directors, if they draw the salary, will come under the ambit of the definition of “employee” u/s 2(9) of ESIC Act, and the said Director is to be included for counting the number of employees for the applicability of ESIC Act. Further, if the Director are drawing salary, then they are liable to pay the Profession Tax under the respective state law.
The plan reading of definition “wages” under Payment of Wages Act never distinguish Directors from other employees and that it includes remuneration be payable to a person in respect of his employment.
So, whether not to draw salary from the Company by choice, for the service rendered by the Director will tantamount the non-compliance under Labour Law?
*Important question to be addressed*
Link to access the High Court order:https://indiankanoon.org/doc/1406830
*Disclaimer:* Views expressed in this write up are my personal views and that may differ with the views of others.
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: Penalty can’t be levied when Assessee collected TDS on the Gross Billing Amount including Service Tax by Mistake: ITAT Delhi
Read more at: http://www.taxscan.in/penalty-cant-levied-assessee-collected-tds-gross-billing-amount-including-service-tax-mistake-itat-delhi/10910/
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# *GST*: GTA can opt for 12% GST with full ITC or alternatively 5% GST payable under RCM by the Service Recipient. In both the cases, the recipient is entitled for full ITC.
# *GST*: Petitioner cannot urge and / or seek directions to the respondents to postpone the decision to implement GST with effect from 01.07.2017 for simple reason that herein levy and collection of taxes on goods and services has sanction of law - Dr. Kanagasabapathy Sundaram Pillai Vs Union Govt. of India (CBEC) (2017 (9) TMI 389 - Bombay High Court).
# *MCA* has issued Circular to clarify the provision w.r.t Exemption to certain unlisted public companies under the Companies (Appointment and Qualification of Directors) Rules, 2014 from the appointment of Independent Directors.
# *MUDRA*: The Pradhan Mantri MUDRA Yojana (PMMY), which provides access to institutional finance to small business units, has helped in creating 5.5 crore jobs with industrialised states being major beneficiaries.
*IT* unearths Rs.246 crore deposit made in a single transaction, in benami account of 'Tamil Nadu neta'.
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: CBEC Issues Norms for Filing of GST Returns
Read more at: http://www.taxscan.in/cbec-issues-norms-filing-gst-returns/10924/
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Govt. has now set its sights on overhauling the 56-year-old direct taxes law covering income and corporation tax as it seeks to make the Indian regime more contemporary and tailor it to current requirements.
Jewellery sales have declined by around 50 per cent over the past four weeks, due to consumers’ deferring of orders amid fear of future action against them under the Prevention of Money Laundering Act.
GST @5% on GTA Service will be paid by Service Receiver under RCM. Service Receiver can take full credit of GST so Paid on GTA. GTA can opt for 12% GST with ITC or 5% GST with no ITC.
It has come to our knowledge that Govt. of India decides to extend the dates of Forms GSTR 1, GSTR-2 and GSTR-3 for the month of July to 20th, 25th and 30th September 2017 respectively. Dates for August Returns extended to 5th, 10th and 15th October respectively. Official notification is awaited.
The Central Government delegates powers to Regional Directors to make representations in case of Reduction of Share Capital by the Company.
MCA has issued list of disqualified Directors on the below given Link:
http://www.mca.gov.in/MinistryV2/disqualifieddirectorslist.html
MCA has issued List Of Directors Associated With Struck Off Companies U/S 248
http://www.mca.gov.in/MinistryV2/directorsstruck248.html
