©orporate Updates on July 4, 2019
Ø India's trade deficit widened with 25 nations in 3 yrs
Ø Cabinet approves award of 3 out of 6 airports to Adani
Ø Indian cos supplying to Huawei may face US sanctions
Ø Cabinet approves Code on Wages bill
Ø BSNL FY19 loss at over Rs 14,000 crore: Govt
Ø Icra cuts McLeod Russel’s rating to ‘default’ grade
Ø RBI to regulate housing finance firms, review assets
Ø Larsen and Toubro receives promoter's tag in Mindtree with 60% stake
Ø CLP inks deal to buy 3 power assets from Kalpataru for Rs 3,275 cr
Ø Multiple triggers could boost Axis Bank's return ratios, say analysts
Ø NCLAT reserves order on contempt plea filed against Reliance Infratel
Ø Indiabulls Fin to buyback NCDs, masala bonds worth Rs 2,705 cr in Sept
Ø Eris Lifesciences board approves buyback plan of up to Rs 100 cr
Ø Oil India to exit Russian oil block
Ø USFDA issues warning letter to Aurobindo Pharma
Ø Vedanta to spend $245 m to explore 10 OALP blocks
Ø Lupin gets USFDA nod for Cinacalcet tablets and intraocular solution
Ø Blackstone buys stake in L&T Business Park for around ₹700 crore
Ø RBI forms working group to review regulatory framework for core investment cos
Ø Drug regulator warns of hacking risk in Medtronic insulin pumps
Ø India urges Russia to consider energy consuming nations’ interest
Ø Service providers may now opt for GST composition scheme till July 31
Ø Jet suppliers go on merger spree trying to keep up with Boeing and Airbus output
Ø RBI forms working group to review regulatory framework for core investment companies
Ø Rupee edges 6 paise higher at 68.89 against US dollar
Ø SENSEX, Nifty end marginally higher
Ø Govt. neither divesting nor privatising ONGC: Pradhan
Ø MSP of kharif crops raised
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Hon’ble Delhi High Court has issued notice to government in a writ petition filed by Bharti Telemedia Ltd. (W.P.(C) 6293/2019) challenging Section 16(2)(c), Second proviso to Section 16(2)(d), etc. of Central Goods and Service Tax Act, 2017 (‘CGST Act’ or ‘Act’).
Section 16(2)(c) states, “Registered person shall be entitled to Input Tax Credit (‘ITC’) of tax charged by Supplier if tax has actually been paid to the Government, either in Cash or through Utilization of Input Tax Credit (‘ITC’) by Supplier”.
Petitioner’s contends that the Department is vested with all the powers to recover tax, interest and charge penalty as well, owing to non-payment of taxes by erring suppliers. There is no reason to deny ITC to registered recipient for default on part of the supplier.
The matter is listed for next hearing on September, 2019.
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CBIC issues Clarification for processing of Refund Applications which are Wrongly Mapped on Portal [Read Circular]
Read more at: https://www.taxscan.in/cbic-issues-clarification-processing-refund-applications-wrongly-mapped-portal/36782/
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Due Date for Filing form GST ITC-04 Extended [Read Notification]
Read more at: https://www.taxscan.in/due-date-filing-form-gst-itc-04-extended/36788/
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GST AAR Legal updates:
1. Odisha AAAR- Import of Scientific Equipments- Held, for the purpose of exemption, the primary requirement is that the importer must be a Public funded research institution or any other institution as specified in the Notification No-51/1996-Customs. The Rulings pronounced by the Advance Ruling Authority, Odisha is correct and justified. The appeal filed by the Appellant fails as it does not fulfill the requirement of public funded research institution.
2019-VIL-49-AAAR
2. Maharashtra AAR- Place of supply- In the present case, though the location of the service receiver is outside India, the services supplied are in respect of goods which are made physically available by the service receiver to the service provider for the services to be performed. The provisions of S.13 (3)(a) of IGST Act are applicable for supply. When ‘place of supply’ is in taxable territory, the applicant’s supply cannot be considered as Export of Services as per the GST Law. Since the ‘place of supply’ and the ‘service provider’ are in the same State, CGST and SGST are applicable for this transaction.
2019-VIL-184-AAR
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Welcome decision of AAR on residential property given to Company
AAR Ruling:- NO GST on renting of residential property for residence to company [Read Order]:: http://www.taxknowledge.in/gst/5d171a9e0a84e20948892a43
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Circular No. - 102/2019 dated 28th June, 2019
A circular has been issued on 28th June, 2019 covering following subject :-
Clarification regarding applicability of GST on additional / penal interest
Link for Video :-
https://youtu.be/hiWGdp7ovsA
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CGST : Where applicant, sellers of cigarettes, intends to offer extra quantity of cigarettes (quantity discount) in addition to normal quantity against same consideration as a taxable supply to its distributors, since they are contemplating a promotion scheme for distributors wherein they intend to supply additional packs along with regular supply of cigarettes of a particular quantity without receiving any additional consideration for additional packs, extra packs of cigarettes wouldn't be subject to GST
AUTHORITY FOR ADVANCE RULINGS, MAHARASHTRA
Golden Tobacco Ltd., In re
B. TIMOTHY AND B.V. BORHADE, MEMBER
ORDER NO. GST/ARA/121/2018-19/B-52
MAY 4, 2019
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Tough time for importer since they need to pay RCM on ocean freight even if import on CIF basis as per AAR for FY 2017-18, and can't claimed ITC since time to claim ITC also expired
AAR Ruling:- Importer needs to pay GST on Ocean Freight even if import as CIF as per ruling of AAR. [ Read Order]:: http://www.taxknowledge.in/gst/5d1b41da0a84e20948892a4b
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Over 2 lakh new registrations in Haryana under GST:
READ MORE- https://www.gststation.in/over-2-lakh-new-registrations-in-haryana-under-gst/
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Three Indian nationals fined for Singapore GST fraud:
READ MORE- https://www.gststation.in/three-indian-nationals-fined-for-singapore-gst-fraud/
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Due dates
• 07-07-2019 - Deposit of TDS/TCS for the month of June 2019.
• 07-07-2019 -Equalisation levy deposit which is withheld at the time of payment by the service recipient where the annual payment made to one service provider exceeds Rs.1,00,000 in one financial year for the specified and notified services.
• 10-07-2019 - GSTR 8 for E-Commerce Companies for the m/o June 2019.
• 10-07-2019 - Filing GSTR-7 (for assessee who is required to deduct TDS under GST) for the m/o June 2019.
• 10-07-2019 - Issue of TDS Certificate for salary for the financial year 2018-19.
• 11-07-2019 - GSTR-1 for the month of June 2019 for taxpayers with Annual Aggregate turnover more than 1.50 Crore.
• 13-07-2019 - GSTR-6 for Input Service Distributor.
• 14-07-2019 - Issue of TDS Certificate for tax deducted under section 194-IA/194-IB in m/o May'19.
• 15-07- 2019 - Quarterly statement of TCS for the quarter ending 30 June, 2019.
• 15-07-2019- ESI/PF Payment for m/o June 2019.
• 15-07-2019- FLA Report it is required to be submitted directly by all Indian Companies which have received FDI or made FDI abroad for m/o June 2019.
• 18-07-2019- GSTR-4 Quarterly return for taxpayers opting for composition scheme.
• 20-07-2019 - GSTR-3B for the m/o June 2019.
• 20-07-2019 - GSTR-5 for the m/o June 2019.
• 20-07-2019 - GSTR-5A for the m/o June 2019.
• 25-07-2019- EPF return filing for the month of June 2019.
• 30 -07-2019 -Quarterly TCS certificate in respect of tax collected by any person for the quarter ending June 30, 2019.
• 30-07-2019 - Furnishing challan-cum-statement in respect of tax deducted u/s 194-IA/194IB in month of June'19.
• 31-07-19 - GSTR-1 for June Quarter applicable for taxpayers with Annual Aggregate turnover upto Rs. 1.50/- Crore.
• 31-07- 2019 - Quarterly statement of TDS for the quarter ending 30 June, 2019.
• 31-07- 2019 – Income Tax return for the F.Y 2018-19 (A.Y 2019-20) for all assessee other than (a) corporate-assessee or (b) non-corporate assessee (whose books of account are required to be audited) or (c) working partner of a firm whose accounts are required to be audited or (d) an assessee who is required to furnish a report u/s 92E.
• 31-07-2019- Payment of Professional Tax and Shop and Establishments taxes.
• 31-07-2019- Form 67 Due date for claimimg Foreign Tax Credit,upload statement of Foreign income offered for tax for previous year 2018-19 and of Foreign tax deducted or paid on such incomes.
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Agri-warehousing cos seek GST waiver ahead of Union Budget:
READ MORE- https://www.gststation.in/agri-warehousing-cos-seek-gst-waiver-ahead-of-union-budget/
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Gujarat Budget: Amnesty offered on 20,000 pre-GST cases:
READ MORE- https://www.gststation.in/gujarat-budget-amnesty-offered-on-20000-pre-gst-cases/
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GST: Service providers may now opt for composition scheme till July 31:
READ MORE- https://www.gststation.in/gst-service-providers-may-now-opt-for-composition-scheme-till-july-31/
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Realty sector seeks clarity on GST rate for joint development of commercial projects:
READ MORE- https://www.gststation.in/realty-sector-seeks-clarity-on-gst-rate-for-joint-development-of-commercial-projects/
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Possible to merge 12%, 18% GST as revenues rise: Arun Jaitley:
READ MORE- https://www.gststation.in/possible-to-merge-12-18-gst-as-revenues-rise-arun-jaitley/
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👉Govt warns businesses & issues a Strict Warning against generating fake invoices to evade GST, saying tax officers will take strict action in such cases.
👉CBIC issues Detailed Guidelines on the Refund of Taxes paid on Inward Supply of Indigenous Goods by Retail Outlets established at the departure area of the International Airport beyond Immigration Counters when supplied to outgoing International Tourist against Foreign Exchange.
👉MCA notifies 15 Aug, 2019, as the Effective Date/ Commencement Date for Section 81 of the Companies (Amendment) Act, 2017 pertaining to “Nidhi Companies”, i.e. the date on which provisions of such section shall come into force/ effect. MCA also issues Nidhi (Amendment) Rules, 2019.
👉MCA issues Companies (Significant Beneficial Owners) Second Amendment Rules, 2019, to amend Form BEN -2, which has been substituted now.
👉RBI imposes penalties ranging between Rs 25-50 Lakhs on 4 Public Sector Banks, for violating Know Your Customer (KYC) norms and Anti-Money Laundering Standards.
👉3 days after presentation of the Union Budget in Parliament, Finance Minister Nirmala Sitharaman will address Reserve Bank of India's (RBI's) Central Board of Directors in a Customary Post-Budget Meeting on July 8. Issues related to the Overall Economy & Fiscal Policy Decisions taken by the Govt will be taken up during the meeting.
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Latest amendments in GST Rules
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1. Rule 10A has been inserted - Taxpayers are required to furnish bank account information on the portal within 45 days of the grant of registration or the due date of GSTR-3B, whichever is earlier.
Effective date = 28 June 2019;
2.Rule 21 has been amended- GST registration is liable to be cancelled of a person not furnishing the details required as per Rule 10A referred above.
Effective date = 28 June 2019.
3. Rule 32A has been inserted - For the purpose of charging GST, the value of supply of good or services shall not include the value of Kerala Flood Cess charged thereon.
Effective date = 01st July 2019.
4. Rule 46 and Rule 49 has been amended- A proviso has been inserted to provide the requirement of Quick Response (QR) code on tax invoice and bill of supply, subject to certain conditions and restrictions, as may be specified.
Effective date = To be Notified.
5. Rule 66(2), 67(2) and 87(9) has been amended - Rules relating to the procedure of claiming TDS / TCS deducted has been amended.
Effective date = 28 June 2019.
6. Rule 87 has been amended– A new Sub-rule 13 has been inserted to provide that a registered person can transfer any amount of tax/interest/penalty/fee to any other head in the electronic cash ledger, In this regard, form GST PMT-09 has also been introduced.
Effective date = To be Notified.
7. Rule 95A has been inserted - Rule 95A has been inserted to provide the refund mechanism to the retail outlets established in the departure area of an International Airport. In this regard, form GST RFD-10B has also been introduced.
Effective date = 01st July 2019.
8. Rule 128, 129, 132 and 133 have been amended- Rules relating to anti-profiteering has been amended.
Effective date = 28 June 2019.
9. Rule 138(10) and 138 have been amended - Proviso has been inserted to provide that the validity of e-way bill may be extended within eight hours from the time of its expiry. Rule 138E has been amended to provide that taxpayers claiming the benefit of notification number 02/2019-Central Tax dated 07 March 2019 shall not be allowed to fill form GST EWB-01 if the return has not been filed for two consecutive quarters.
Effective date = 28 June 2019
10. Amendment to GSTR-9 format:- Tables of Annual Return has been amended to provide the details from April 2018 to March 2019 instead of April 2018 to September 2018; Instructions of table 8A has been amended to provide that FORM GSTR-2A generated on 1 May 2019 shall be auto-populated in table 8A.
Formats of Forms REG-01, REG-07, REG-12, GSTR-04, RFD-05 and DRC-03 have also been changed to suit the amendments.
Effective date = 28 June 2019.
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Clarification regarding Annual Returns and Reconciliation Statement via Press Release, Ministry of Finance , 03rd July 2019
Key points:-
📍Role of CA is made clear. It is confined only to reconciliation of GSTR 9 and books and nothing beyond books.
📍Expenses reco - Details of expenses on which ITC has been availed need to be given.
📍Turnover for audit is to be reckoned from July 2017 to March 2018 and not for full financial year.
📍Table 8 is only for settlement purpose and will not be reckoned adversely.
📍Table 16A (Information on supplies from composite suppliers) and 18 (HSN summary of inward supplies) also for informative purpose only.
Clarification in detail
The Government of India has been receiving a number of representations regarding Annual Return (FORM GSTR-9 / FORM GSTR-9A) and Reconciliation Statement (FORM GSTR-9C). In this regard the following clarifications are issued for information of all stakeholders: -
👉a) Payment of any unpaid tax: Section 73 of the CGST Act provides a unique opportunity of self – correction to all taxpayers i.e. if a taxpayer has not paid, short paid or has erroneously obtained/been granted refund or has wrongly availed or utilized input tax credit then before the service of a notice by any tax authority, the taxpayer may pay the amount of tax with interest. In such cases, no penalty shall be leviable on such tax payer. Therefore, in cases where some information has not been furnished in the statement of outward supplies in FORM GSTR-1 or in the regular returns in FORM GSTR-3B, such taxpayers may pay the tax with interest through FORM GST DRC-03 at any time. In fact, the annual return provides an additional opportunity for such taxpayers to declare the summary of supply against which payment of tax is made
👉b) Primary data source for declaration in annual return: Time and again taxpayers have been requesting as to what should be the primary source of data for filing of the annual return and the reconciliation statement. There has been some confusion over using FORM GSTR-1, FORM GSTR-3B or books of accounts as the primary source of information. It is important to note that both FORM GSTR-1 and FORM GSTR-3B serve different purposes. While, FORM GSTR-1 is an account of details of outward supplies, FORM GSTR-3B is where the summaries of all transactions are declared and payments are made. Ideally, information in FORM GSTR-1, FORM GSTR-3B and books of accounts should be synchronous and the values should match across different forms and the books of accounts. If the same does not match, there can be broadly two scenarios, either tax was not paid to the Government or tax was paid in excess. In the first case, the same shall be declared in the annual return and tax should be paid and in the latter all information may be declared in the annual return and refund (if eligible) may be applied through FORM GST RFD-01A. Further, no input tax credit can be reversed or availed through the annual return. If taxpayers find themselves liable for reversing any input tax credit, they may do the same through FORM GST DRC-03 separately.
👉c) Premise of Table 8D of Annual Return: There appears to be some confusion regarding declaration of input tax credit in Table 8 of the annual return. The input tax credit which is declared / computed in Table 8D is basically credit that was available to a taxpayer in his FORM GSTR-2A but was not availed by him between July 2017 to March 2019. The deadline has already passed and the taxpayer cannot avail such credit now. There is no question of lapsing of any such credit, since this credit never entered the electronic credit ledger of any taxpayer. Therefore, taxpayers need not be concerned about the values reflected in this table. This is merely an information that the Government needs for settlement purposes. Figures in Table 8A of FORM GSTR-9 are auto-populated only for those FORM GSTR-1 which were furnished by the corresponding suppliers by the due date. Thus, ITC on supplies made during the financial year 2017-18, if reported beyond the said date by the corresponding supplier, will not get auto-populated in said Table 8A. It may also be noted that FORM GSTR-2A continues to be auto-populated on the basis of the corresponding FORM GSTR-1 furnished by suppliers even after the due date. In such cases there would be a mis-match between the updated FORM GSTR-2A and the auto-populated information in Table 8A. It is important to note that Table 8A of the annual returns is auto-
populated from FORM GSTR-2A as on 1st May, 2019.
👉d) Premise of Table 8J of Annual Return: In the press release on annual return issued earlier on 4th June 2019, it has already been clarified that all credit of IGST paid at the time of imports between July 2017 to March 2019 may be declared in Table 6E. If the same is done properly by a taxpayer, then Table 8I and 8J shall contain information on credit which was available to the taxpayer and the taxpayer chose not to avail the same. The deadline has already passed and the taxpayer cannot avail such credit now. There is no question of lapsing of any such credit, since this credit never entered the electronic credit ledger of any taxpayer. Therefore, taxpayers need not be concerned about the values reflected in this table. This is information that the Government needs for settlement purposes.
👉e) Difficulty in reporting of information not reported in regular returns: There have been a number of representations regarding non-availability of information in Table16A or 18 of Annual return in FORM GSTR-9. It has been observed that smaller taxpayers are facing a lot of challenge in reporting information that was not being explicitly reported in their regular statement/returns (FORM GSTR-1 and FORM GSTR-3B). Therefore, taxpayers are advised to declare all such data / details (which are not part of their regular statement/returns) to the best of their knowledge and records. This data is only for information purposes and reasonable/explainable variations in the information reported in these tables will not be viewed adversely.
👉f) Information in Table5D(Exempted), Table 5E (Nil Rated) and Table 5F (Non-GST Supply): It has been represented by various trade bodies/associations that there appears to be some confusion over what values are to be entered in Table 5D,5E and 5F of FORM GSTR-9. Since, there is some overlap between supplies that are classifiable as exempted and nil rated and since there is no tax payable on such supplies, if there is a reasonable/explainable overlap of information reported across these tables, such overlap will not be viewed adversely. The other concern raised by taxpayers is the inclusion of no supply in the category of Non-GST supplies in Table 5F. For the purposes of reporting, non-GST supplies includes supply of alcoholic liquor for human consumption, motor spirit (commonly known as petrol), high speed diesel, aviation turbine fuel, petroleum crude and natural gas and transactions specified in Schedule III of the CGST Act.
👉g) Reverse charge in respect of Financial Year 2017-18 paid during Financial Year 2018- 19: Many taxpayers have requested for clarification on the appropriate column or table in which tax which was to be paid on reverse charge basis for the FY 2017-18 but was paid during FY 2018- 19. It may be noted that since the payment was made during FY 2018-19, the input tax credit on such payment of tax would have been availed in FY 2018-19 only. Therefore, such details will not be declared in the annual return for the FY 2017-18 and will be declared in the annual return for FY 2018-19. If there are any variations in the calculation of turnover on account of this adjustment, the same may be reported with reasons in the reconciliation statement (FORM GSTR-9C).
👉h) Role of chartered accountant or a cost accountant in certifying reconciliation statement: There are apprehensions that the chartered accountant or cost accountant may go beyond the books of account in their recommendations under FORM GSTR-9C. The GST Act is clear in this regard. With respect to the reconciliation statement, their role is limited to reconciling the values declared in annual return (FORM GSTR-9) with the audited annual accounts of the taxpayer.
👉i) Turnover for eligibility of filing of reconciliation statement: It may be noted that the aggregate turnover i.e. the turnover of all the registrations having the same Permanent Account Number is to be used for determining the requirement of filing of reconciliation statement. Therefore, if there are two registrations in two different States on the same PAN, say State A (with turnover of Rs. 1.2 Crore) and State B (with turnover of Rs. 1 Crore) they are both required to file reconciliation statements individually for their registrations since their aggregate turnover is greater than Rs. 2 Crore. The aggregate turnover for this purpose shall be reckoned for the period July, 2017 to March, 2018.
👉j) Treatment of Credit Notes / Debit Notes issued during FY 2018-19 for FY 2017-18: It may be noted that no credit note which has a tax implication can be issued after the month of September 2018 for any supply pertaining to FY 2017-18; a financial/commercial credit note can, however, be issued. If the credit or debit note for any supply was issued and declared in returns of FY 2018-19 and the provision for the same has been made in the books of accounts for FY 2017-18, the same shall be declared in Pt. V of the annual return. Many taxpayers have also represented that there is no provision in Pt. II of the reconciliation statement for adjustment in turnover in lieu of debit notes issued during FY 2018-19 although provision for the same was made in the books of accounts for FY 2017-18. In such cases, they may adjust the same in Table 5O of the reconciliation statement in FORM GSTR-9C.
👉k) Duplication of information in Table 6B and 6H: Many taxpayers have represented about duplication of information in Table 6B and 6H of the annual return. It may be noted that the label in Table 6H clearly states that information declared in Table 6H is exclusive of Table 6B. Therefore, information of such input tax credit is to be declared in one of the rows only.
👉l) Reconciliation of input tax credit availed on expenses: Table 14 of the reconciliation statement calls for reconciliation of input tax credit availed on expenses with input tax credit declared in the annual return. It may be noted that only those expenses are to be reconciled where input tax credit has been availed. Further, the list of expenses given in Table 14 is a representative
list of heads under which input tax credit may have been availed. The taxpayer has the option to add any head of expenses.
All the taxpayers are requested to file their Annual Return (FORM GSTR-9 / FORM GSTR-9A) and Reconciliation Statement (FORM GSTR-9C) well before the last date of filing, i.e. 31st August, 2019.
