Supply to Duty Free shops will attract gst rules M.P high court
In what could be seen as a set back for the suppliers to duty-free shops at international airports, a High Court has ruled out GST exemption on such supplies by Indian manufacturers.
Though the matter is not related to travellers directly, he/she will have to pay higher prices for goods supplied by Indian manufacturers because it will be factored in the maximum retail price. Besides, it will make duty-free shops in India less attractive than the others across the world.
Duty-free shops at international airports have their own attraction as they offer goods at lesser costs. One can buy alcohol, cigarettes, chocolates and perfumes, among others, by producing passport and boarding pass. “No provision of law has been brought to the notice of this Court under the Central Goods and Services Tax Act, 2017, which grants exemption from payment of taxes,” a two-judge Bench of the Madhya Pradesh High Court said in its order involving a supplier Vasu Clothing Private Ltd. The Bench also said a tax statute has to be strictly construed. In a Tax Act, one has to look merely at what is clearly said. “There is no room for any intendment. There is no equity about a tax. There is no presumption as to tax. Nothing is to be read in, nothing is to be implied,” it said.
Exemption notification
Anita Rastogi, Indirect Tax Partner at PwC, said goods supplied to duty-free shops at airports are charged to GST as currently there is no specific exemption like the pre-GST regime. “Only an exemption notification allowing non-levy of GST can support the point of non-taxability of supplies to duty-free shops as the law otherwise is very clear,” she said.
The petitioner’s contention was that after the enactment of the Central Goods and Service Tax Act, 2017 and the Rules framed there under, it was entitled to supply goods and services to duty-free shops without payment of taxes. Similar supplies from all over the world, except India, are permitted without payment of taxes. The petitioner is a manufacturer and exporter of garments in India and intends to supply goods to Duty Free Operator (DFO), who in turn sells the goods from duty-free shops. It was argued that prior to GST implementation, the duty-free operations in India were exempted from payment of Customs Duty, Countervailing Duty (CVD), Special Additional Customs Duty (SACD), Excise Duty, VAT / Sales Tax, OCTROI, etc. The petitioner also said the principle for exemption from payment of VAT / Sales Tax by an Indian duty-free shop was evolved pursuant to the judgment delivered by the Supreme Court in a matter involving ITDC (one which runs a number of duty-free shops at international airports in India).
Accordingly, the company prayed for a notification to be issued by the government. Its grievance was that in the absence of exemption notification under the relevant GST laws, the DFOs are unable to buy the goods manufactured in India without paying the applicable rate of taxes as provided under the CGST, IGST or SGST as the case may be.
After hearing all, the court made it clear that Indian manufacturer / producer of goods is not entitled for exemption from GST. The Exemption Notifications dated May 23, 2013, issued in respect of payment of exemption of taxes during pre-GST regime are no longer in existence after introduction of GST. The courts do not have the power to legislate, they can only do interpretation of a statute, it clarified.
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A worth thought about GST interest
BENEFICIAL LEGISLATION IS ALWAYS RETROSPECTIVE : Amendment in Section 50 with respect to interest to be charged only on net tax liability basis.
In other words, this would bring down the interest burden on the taxpayer who was earlier being subjected to undue interest liability. A taxpayer can now file even PART-RETURN i.e GSTR-3B. If the tax liability for a taxpayer in the month of December is Rs 3 lakhs and he has ITC worth Rs two lakh in his ledger and can arrange cash only to the tune of Rs 50,000/- he will be allowed to part-file his GSTR-3B and pay only Rs 2.5 lakh of his tax liability through cash and the ITC and whenever he arranges the balance amount, the same can be paid with interest to be charged only on the balance rather than the entire amount of Rs three lakh which has been the case at present. .
LESSON : If you were late in deposit of tax, calculate overdue interest even for past as per new proposal. Department may resist but don't worry.
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IT: Where High Court set aside reassessment proceedings on ground that said proceedings were based on mere audit objection that there was undervaluation of closing stock, SLP filed against said order was be dismissed.
SUPREME COURT OF INDIA
Principal Commissioner of Income-tax. v.
S. Chand & Co. Ltd.
SPECIAL LEAVE PETITION (CIVIL) DIARY NO. 38560 OF 2018
NOVEMBER 16, 2018
Section 145, read with section 147, of the Income-tax Act, 1961 - Method of accounting - (Valuation of stock) - Assessment year 2007-08 - In course of assessment, assessee declared closing stock in respect of work-in-progress - Assessing Officer completed assessment accepting value of stock declared by assessee - Subsequently, assessment was reopened on ground that there was undervaluation of stock - High Court finding that reassessment proceedings were based on mere audit objection, set aside said proceedings - Whether, on facts, SLP filed against order of High Court was to be dismissed - Held, yes [Para 2] [In favour of assessee]
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Supply of food in canteens of office, factory, hospital, college, industrial unit etc. on contractual basis excepting that supply is not event based or on specific occasions, constitute supply of service in terms of amended Notification No.13/2018-Central Tax(Rate) Dated .26.7.18 and is taxable at the rate of 5% and the supplier is not eligible for the input tax credit as per the condition stipulated therein. As Per Serial No 7(i) of notification No. 13/2018-CT (Rate).
Examples Of Above Type Of Services Are-
1. Canteen services provided in organizations like Infosys etc., wherein the food is cooked in the premises of Infosys and "Sold" to the employees of the said organization at a price mutually agreed upon, it is done on a regular daily basis.
2. Applicant also has a kitchen in Miyapur, where food is prepared and transported to some software companies where it is again sold" to the company employees in the dining Hall. The software companies do not have kitchens because of safety reasons, but however, they have dining hall facilities. The Dining Hall/cafeteria runs on a daily basis. A separate food license is obtained by us for selling the food in this organisation issued by GHMC.
In all the above 5 Circumstances the GST will be charged @5% without Input Tax Credit
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No GST applicable on Reimbursement of Salary on behalf of Foreign Entity: AAR [Read Order]
Read more at: http://www.taxscan.in/no-gst-applicable-reimbursement-salary-behalf-foreign-entity-aar/32105/
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NAA dismisses Profiteering Complaint against PEPS Mattress [Read Order]
Read more at: http://www.taxscan.in/naa-dismisses-profiteering-complaint-peps-mattress/32111/
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👉A blow for companies with a presence in multiple states, the Karnataka Appellate Authority for Advance Rulings uphelds the levy of GST on services rendered by one office branch to other centres.
👉CBDT instructs that no coercive measures to recover the outstanding demand would be taken in case of ‘Start Ups’, if additions have been made by the Assessing Officer u/s 56(2)(viib).
👉The Income Tax Dept seizes assets worth Rs 992.52 crore during 2017-18, while 582 search and seizure operations were conducted during the FY, tax-to-GDP ratio improves.
👉CBIC releases updated ready reckoner (Standard Operating Procedure) on TDS under GST including FAQs on December 27, 2018
Download it: https://bit.ly/2Rlcsgp
👉SEBI expands its Offer For Sale (OFS) Framework to all the companies with market cap. of Rs 1,000 crore and above which currently was applicable only to top 200 companies by market cap.
👉Public sector banks approves more than 1.12 lakh loan applications of MSMEs totalling Rs 37,412 crore under the '59 Minutes' loan scheme launched by the Govt in November.
👉The Govt says 6 PSUs, including THDCIL, TCIL and Rail Tel, will come out with IPOs, while KIOCIL will issue follow on public offer (FPO).
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ICAI appoints CA Sanjay Kumar Goyal as head of Disciplinary Directorate [Read Notification]
Read more at: http://www.taxscan.in/icai-sanjay-kumar-goyal-disciplinary/32117/
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CBDT releases Explanatory Notes to Provisions of Finance Act, 2018 [Read Circular]
Read more at: http://www.taxscan.in/cbdt-explanatory-notes-finance-act-2018/32120/
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Recommendations made during 31st Meeting of the GST Council on 22nd Dec, 2018
⛳ Single Cash Ledger.
🌴 All cash ledgers of each tax head (i.e. CGST, IGST, SGST/UTGST) would be combined into a single cash ledger.
Comment- The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities.
⛳ Single Authority for Refund.
🌴 A scheme of single authority for disbursement of the refund amount sanctioned by either the Centre or the State tax authorities would be implemented on pilot basis.
Comment - The modalities for the same shall be finalized shortly.
⛳ Simplified Return System.
🌴 Simplified new return filing system to be introduced on trial basis from 01.04.2019 and on mandatory basis from 01.07.2019.
Comment - GST Council in its 27th meeting held on 4th May, 2018 had approved the basic principles of GST return design. Now in its 28th meeting held on 21st July, 2018, GST Council approved the key features and new format of the GST returns.
⛳ Annual Return & GST Audit – Due Date Extended to 30.06.2019.
🌴 FORM GSTR-9, GSTR-9A, GSTR-9C for F/Y 2017-18 – Due Date 30.06.2019.
Comment - Currently the news is GSTR-9 & GSTR-9C will be available on the portal by 31st Jan 2019.
⛳ Clarificatory changes in the formats/instructions of GSTR-9 & GSTR-9C.
🌴 Amendment of headings in the forms to specify that the return in FORM GSTR-9 & FORM GSTR-9A would be in respect of supplies etc. ‘made during the year’ and not ‘as declared in returns filed during the year’.
🌴 All returns in FORM GSTR-1 & FORM GSTR-3B* have to be filed before filing of FORM GSTR-9 & FORM GSTR-9C
🌴 All returns in FORM GSTR-4 have to be filed before filing of FORM GSTR-9A.
🌴 HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies.
🌴 Additional payments, if any, required to be paid can be done through FORM GST DRC-03 only in cash.
🌴 ITC cannot be availed through FORM GSTR-9 & FORM GSTR-9C.
🌴 All invoices pertaining to previous FY (irrespective of month in which such invoice is reported in FORM GSTR-1) would be auto-populated in Table 8A of FORM GSTR-9.
🌴 Value of “non-GST supply” shall also include the value of “no supply” and may be reported in Table 5D, 5E and 5F of FORM GSTR-9.
🌴 Verification by taxpayer who is uploading reconciliation statement would be included in FORM GSTR-9C.
Comment - Whether GSTR-1 to amend or not of previous FY. Lets wait for the Notification.
⛳ FORM GSTR-8 by e-commerce operators.
🌴 The due date for furnishing FORM GSTR-8 by e-commerce operators for the months of October, November and December, 2018 shall be extended till 31.01.2019.
⛳ FORM GST ITC-04 (Job Work)
🌴 The due date for submitting FORM GST ITC-04 for the period July 2017 to December 2018 shall be extended till 31.03.2019.
⛳ ITC for FY 2017-18 – can be availed upto filing of GSTR-3B of March’2019
🌴 Input Tax Credit w.r.t invoices of F/Y 2017-18 may be availed by recipient till the due date of furnishing FORM GSTR-3B for the month of March 2019. (Subject to conditions as may be specified).
Comment - Relief to avail it on or before 31.03.2019.
⛳ Documents/invoices in FORM GST RFD-01A - uploaded electronically.
🌴 All the supporting documents/invoices in relation to a claim for refund in FORM GST RFD-01A shall be uploaded electronically on the common portal at the time of filing of the refund application itself, thereby obviating the need for a taxpayer to physically visit a tax office for submission of a refund application. GSTN will enable this functionality on the common portal shortly.
⛳ Types of refunds available through FORM GST RFD-01A
🌴 Refund on account of Assessment/Provisional Assessment/Appeal/Any Other Order;
🌴 Tax paid on an intra-State supply which is subsequently held to be inter-State supply and vice-versa;
🌴 Excess payment of Tax; and
🌴 Any other refund.
⛳ One more window for completion of migration process.
🌴 The due date for FORM GST REG-26 but received only a Provisional ID (PID) till 31.12.2017 for furnishing the requisite details to the jurisdictional nodal officer shall be extended till 31.01.2019.
🌴 The due date for FORM GSTR-3B and FORM GSTR-1 for the period July, 2017 to February, 2019/quarters July, 2017 to December, 2018 by such taxpayers shall be extended till 31.03.2019.
⛳ Late Fee Waiver on delay filing of Returns.
🌴 Late fee shall be completely waived for all taxpayers in case FORM GSTR-1, FORM GSTR-3B & FORM GSTR-4 for the months / quarters July, 2017 to September, 2018, are furnished after 22.12.2018 but on or before 31.03.2019
Comment - Question is those who had paid the late fee till 22.12.2018, whether reversal would be made or not. Most probably Late Fee would be waive of for those return filed after 22.12.19 to 31.03.2019 but not for others.
⛳ Restriction on Generation of E-Way Bill – for Return Defaulters.
🌴 Taxpayers who have not filed the returns for two consecutive tax periods shall be restricted from generating e-way bills.
Comment- This provision shall be made effective once GSTN/NIC make available the required functionality.
⛳ Clarifications shall be issued on certain refund related matters like refund of ITC accumulated on account of inverted duty structure, disbursal of refunds within the stipulated time, time allowed for availment of ITC on invoices, refund of accumulated ITC of compensation cess etc.
⛳ Changes in CGST/IGST/SGST & Other Acts would be notified w.e.f. 01.02.2019*.
⛳ The requisite Notifications/Circulars for implementing the above recommendations of the GST Council shall be issued shortly.
⛳ Constitution of Centralized AAAR.
🌴 Creation of Centralized Appellate Authority for Advance Ruling to deal with conflicting decisions between two or more State AAAR on the same issue.
⛳ Changes/clarification regarding tax rate & exemption of several goods & services have also been recommended during the meeting.
⛳ RCM proposed on Security services (supply of security personnel) provided to a registered person.
⛳ Taxation of Residential Property in Real Estate Sector – Issue referred to Law Committee and GST Council Meeting would take a view in its next meeting.
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UDIN deferred for a month to 1st Feb19
Central Council of ICAI has decided to mandate UDIN w.e.f 1st Feb., 2019 as against the earlier announced date of 1st Jan., 2019 in a phased manner
As you are aware that to secure the certificates/documents attested/certified by practicing Chartered Accountants and for tracing forged/wrong documents prepared by any third person misrepresenting himself as a Chartered Accountant, ICAI had implemented an innovative concept of UDIN i.e. Unique Document Identification Number.
We wish to inform that for this prestigious project of UDIN, ICAI has engaged Tata Consultancy Services (TCS) who is also automating and will maintain the life cycle of CA Members and Students making them largely online on a digital platform.
To enable TCS do the huge data migration and data audit which will require around 30 days before the UDIN Platform becomes mandatory, Central Council of ICAI has decided to mandate UDIN w.e.f 1st Feb., 2019 as against the earlier announced date of 1st Jan., 2019 in a phased manner
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# ICAI: Revised Implementation Guide to SA 230, “Audit Documentation” issued by the Auditing and Assurance Standards Board - https://resource.cdn.icai.org/52985aasb42474.pdf
# UDIN : Central Council of ICAI has decided to mandate UDIN w.e.f 1st Feb., 2019 as against the earlier announced date of 1st Jan., 2019 in a phased manner
#File your Income Tax Return before 31st December 2018 to avoid higher Late fee of up-to Rs.10,000 if not filed yet.
#CA can be held guilty of professional Misconduct for his act although unrelated to profession but which brings disrepute to the profession or ICAI - Council of the ICAI Vs Shri Gurvinder Singh & Anr. (Supreme Court of India)
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👉The Gujarat High Court quashes a list of disqualified directors published by MCA. Justice Bela M. Trivedi held that Section 164(2) of the Companies Act is prospective in nature and will take effect only from its date of notification, viz, April 1, 2014.
👉National Anti-profiteering Authority imposes a penalty of Rs. 233 crore on the HUL for not passing GST rate cut benefit to the consumers after the large-scale cut last November.
👉CBDT extends the due date for furnishing of Country-by-Country Report under Section 286(4) of Income Tax Act, 1961 to March 31, 2019.
👉CBIC releases Latest FAQ’s on GST updated upto 15th Dec 2018
Download it: https://bit.ly/2Age1Cv
👉For the first time in 2 decades, India is getting more foreign investment than China. In 2018, India saw more than $38 billion of inbound deals compared with China’s $32 billion.
👉ED files prosecution complaint against Vadodara-based Diamond Power Infrastructure Ltd. (DPIL) before the special PMLA court in an alleged bank fraud case of Rs2,654 crore.
👉Govt decides to infuse Rs 2,159 crore in United Bank of India as part of Rs 28,615 crore capital infusion to be done in about half a dozen banks.
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GST Dept attaches Bank Accounts of Actor Mahesh Babu
Read more at: http://www.taxscan.in/gst-bank-accounts-actor-mahesh-babu/32069/
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Charges for cheque bounce collected by an entity from its customers are liable to be taxed with the applicable Goods and Services Tax (GST) rate, the Authority for Advanced Ruling (AAR).
You may soon get separate bills for taxable and non-taxable components in bills that include services exempt under GST regime. The GST Council has decided to extend the unbundling of bills beyond healthcare for all categories of services currently exempt from the tax, such as education
Gujarat tops the list of States in number of violations of the e-Way bill system, introduced in April. The highest amount of tax evasion, meanwhile, took place in Tamil Nadu. The data, presented by the Ministry of Finance to the Lok Sabha.
31st Dec Last Date - ROC (Form AOC-4/4 CFS, Form MGT-7) & XBRL (E-form AOC-4 & CRA-4) without Additional Fee.
RBI has formed an expert committee under former governor Bimal Jalan to decide the appropriate level of reserves that the regulator should hold. This comes more than a month after the bank’s central board proposed the panel’s formation following a dispute between then governor Urjit Patel
UDIN: Central Council of ICAI has decided to mandate UDIN w.e.f 1st Feb., 2019 as against the earlier announced date of 1st Jan., 2019 in a phased manner.
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CBDT asks to remit TDS on Rent Over 50,000 per Month
Read more at: http://www.taxscan.in/cbdt-tds-rent-50000/32074/
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CBIC issues Guidelines for processing Applications for Financial Assistance under Seva Bhoj Yojna [Read Circular]
Read more at: http://www.taxscan.in/cbic-guidelines-financial-assistance-seva-bhoj-yojna/32079/
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GST Bail Cancellation Case: Delhi HC dismisses Petition, Upholds Sessions Courts Order
Read more at: http://www.taxscan.in/gst-bail-cancellation-delhi-hc-dismisses-petition/32100/
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CBIC issues Guidelines for processing Applications for Financial Assistance under Seva Bhoj Yojna [Read Circular]
Read more at: http://www.taxscan.in/cbic-guidelines-financial-assistance-seva-bhoj-yojna/32079/
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GST Bail Cancellation Case: Delhi HC dismisses Petition, Upholds Sessions Courts Order
Read more at: http://www.taxscan.in/gst-bail-cancellation-delhi-hc-dismisses-petition/32100/