Vision Statement...Dinesh M. Tambde Raj P. Shah Hon.treasurer Hon. Jt. Secretaries Aalok K. Mehta...

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GSTPAM to be a Leading Association of Tax Professionals

practising in Indirect Taxes especially GST.

GSTPAM shall educate and enrich members with the

knowledge on Indirect Taxes operative in the State of

Maharashtra and across whole of India.

GSTPAM shall encourage and empower members to be leading

Tax Professionals in the arena of Indirect Taxes.

GSTPAM shall assist and support members to achieve

excellence in Professional Competence leading to a successful

career.

GSTPAM shall spread awareness and knowledge on GST and

other Indirect Taxes to the taxpayers and public at large.

GSTPAM shall make strong representations on legal and

administrative issues arising in implementation of Indirect Tax

Laws to the State and Central Government Authorities.

Vision Statement

THE GOODS AND SERVICES TAX PRACTITIONERS’ ASSOCIATION OF MAHARASHTRA

(Formerly Known as The Sales Tax Practitioners' Association of Maharashtra)

GSTPAM

GST Issues & A Way Forward Amidst

COVID-19

by

MONARCH BHATT, ADVOCATE

The Goods and Services Tax Practitioners’ Association of Maharashtra

GSTPAM

© The Goods and Services Tax Practitioners’ Association of Maharashtra

No part of this publication may be reproduced or transmitted in any form or by any means without the prior written permission of The Goods and Services Tax Practitioners’ Association of Maharashtra.

The views expressed herein are those of the compiler(s) and not necessarily those of The Goods and Services Tax Practitioners’ Association of Maharashtra. Though due care has been taken in compiling this publication, any errors or omissions found may please be excused.

Office of GSTPAM: 8 & 9, Mazgaon Tower, 21, Mhatar Pakhadi Road, Mazgaon, Mumbai-400 010. Tel.: 2375 2267/68

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About the Author

Monarch Bhatt is working as Indirect Tax partner in “FairLaw Consultancy” and as an Associate of “Shri. S. S. Gupta, CA”.

Monarch is exclusively practising into indirect taxes over 14 years and handling advisory, litigation and compliances. He is advising numerous clients with varieties of different issues on GST, Service Tax and Excise on retainership basis. He is arguing across the country’s tribunal and High Courts and has secured landmark judgments in his favour.

Monarch Bhatt is working on GST since 2009, when first discussion paper on GST was issued in the public domain.

Monarch has delivered many lectures on GST, where he has trained more than 10,000 people on GST including government officers, Chartered Accountant, Advocates, industrialist, etc.

Monarch has authored several E-handbooks on the various topics of GST. He is also a columnist for various online portals and print media, where he regularly contributes his articles. He has also authored book on “Sabka Vishwas – Law and Procedure” which is published by Young Global Publications.

He has been awarded by GSTPAM for writing articles on GST and recently he has also been nominated for TIOL award for fiscal columnist.

MANAGING COMMITTEE 2019-20

President Vice-President Dinesh M. Tambde Raj P. Shah

Hon.treasurer Hon. Jt. Secretaries Aalok K. Mehta Sunil G. Khushalani &

Pravin V. Shinde

Ex-officio Member Pradip R. Kapadia

Editor – STR Associate Editor Vikram D. Mehta Talati Dhaval

Managing Committee MembersAditya Seema Pradeep

Badheka Parth R.Chheda Jatin Navin

Gandhi Premal Joshi Sunil D.

Kadam Sudarshan SMadkholkar Mahesh

Mane Amol T.Mhaske Vinod K.Nathani Dilip V.Parekh Gaurav MRao Vivekanand R.Sonawane Narendra K.Surte Aditya S.

Thakar Rahul

Co-opted MembersDr. Dhond Shashank S. • Gandhi Sachin

Parekh Pankaj

Invitees (Local)Acharya Ashvin

Bapat DeepakJadhav PravinParekh ChiragParekh Mayur

Patkar Ishaan V.Patkar Vinayak

Phad D. V.Shah Ashit K.

Shah Hiral S.Shah HitenShirode AmolShivnani AshwinTalati Umang R.Talreja AjayThakkar Deepak Vaghani Janak

Invitees (Outstation)

ChairmanPranav Kapadia

Jt. ConvenorsDilip NathaniParth Badheka

Ex-officioDinesh Tambde

Raj P. Shah

MemberRajat Talati

Premal GandhiAshit Shah

Ankit ChandeC. B. Thakar

D. J. RupareliaDeepak BapatDhaval TalatiIshaan PatkarJanak Vaghani

Hemant D. SaveKantilal JainKiran GarkarRatan Samal

Nikita BadhekaRahul Thakar

Sujata RangnekarSubhash SurteVikram Mehta

The Goods & Services Tax Practitioners Association of Maharashtra

PUBLICATION COMMITTEE ACT, RULES & SHORT PUBLICATION

ON AMENDMENTS – 2019-20

Bafna Mahesh (Dhule)Baheti Arun (Kolhapur)

Berde Abhijit (Ratnagiri)Bhambare R. S. (Parbhani)

Gupta Santosh (Nagpur)Kala Sunil (Aurangabad)Korulkar M. P. (Solapur)

Mehta Ritesh (Nagpur)

Mungatiwar Shripad (Chandrapur)Singh Aloke (Aurangabad)Sisodia Shirish (Jalgaon)Walkar Hemant (Sindhudurg)

Preface

This is the biggest pandemic happening all over the world after a century, where we all are facing new challenges in our life and accordingly, we have changed our life style. Businesses are also not outside this gamut and businesses have almost changed their way of doing the operations. We have seen that government is also working on it and changing the policy to support the businesses.

I have personally experienced through the difficulties being faced by our clients that this are unique issues businesses are facing amidst COVID-19 under Goods and Service Tax. Hence, I have pointed my pen to write this book for the benefits of all.

In this book, I have covered maximum number of issues being faced by the assessee amidst COVID-19. These issues are such where more than one interpretation is possible and I have explained it with the help of legal provisions, case laws, examples and departmental clarifications. Book also covers procedural and compliance issues to be complied by the assessee.

The book also contains, list of important dates for the GST compliance and ready reference of recent notification issued under CGST Acts.

Overall in this book, I have tried to cover everything relating to recent issues being faced by the assessee under GST.

It gives me immense pleasure to present this book. I am sure that this book will benefit Advocates, Chartered Accountants, departmental officers, assessee and all my fellow professionals and readers to understand the legal and procedural nitty-gritties of recent GST issues.

Monarch Bhatt Advocate

IndexChapter

No.Particulars Page

No.

1 Cancellation of Contract 1

1.1 Tax Invoice has been issued – GST has been deposited – Services are not rendered as contract is cancelled

1

1.2 Advances received – Advance Receipt Voucher is issued – GST has been deposited – Contract is cancelled

4

1.3 Advances received – Advance Receipt Voucher is issued – GST has not been deposited and before that contract has been cancelled

6

1.4 Advances received for supply of goods – Contract has been cancelled – Assessee retains certain value and returns balance advances – GST is payable on it?

6

2 Reduction or Waiver of Rent 9

2.1 Lessor reducing rent – By entering into Supplementary Agreement

9

2.2 Lessor reducing rent – Without entering into Supplementary Agreement

10

2.3 Lessor reducing rent – As per force measure clause mentioned in Lease Agreement

12

2.4 Lessor waiving rent – During the lockdown period as announced by the government

12

3 Input Tax Credit 15

3.1 Input Tax credit on Inputs written off 15

3.2 Input Tax Credit on Input Services which has not been directly used to provide output services as contract for output supply got cancelled

16

3.3 Input Tax credit on employee’s Medical Insurance 19

4 Chapter 4 – Reverse Charge Mechanism 22

4.1 Reverse Charge Mechanism on Director’s Fees 22

4.2 Reverse Charge Mechanism on Sponsorship fees 24

5 Leviability of Interest under GST 30

6 Procedural and compliance relief 34

Chapter No.

Particulars Page No.

6.1 Amnesty Scheme for failure to file GSTR 3B – July 2017 to January 2020

35

6.2 GSTR 3B Interest & Late Fees Waiver 35

6.3 GSTR 3B Extension of Due Date - May 2020 43

6.4 GSTR 3B Extension of Due Date – August 2020 44

6.5 GSTR 1 Waiver of Late Fees 45

6.6 Deferment of ITC Restriction - February 2020 to August 2020

46

6.7 E way Bills Extension of Validity 46

6.8 Facility of filing of GSTR 1 and GSTR 3B by EVC for all assessee

47

6.9 Annual Return Extension of Due Date 47

6.10 Revocation of cancellation of registration 47

6.11 Reliefs for Composition Tax Payer 48

6.12 Extension of time for issuance of refund order 49

6.13 Other Due Dates Extension 49

7 Possible GST boosters in near future 52

7.1 Relaxing provisions relating ITC 52

7.2 Free flow of CGST credit 54

7.3 Allowing three months time for availing ITC of 18-19 54

7.4 Allowing three months time for issuance of credit notes for 18-19

55

7.5 GST rate reduction 55

7.6 Abeyance of anti-profiteering clause 57

7.7 Payment of GST on quarterly basis 57

8 List of notifications issued under CGST 59

9 Summary of important due dates for GST compliance 68

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Chapter 1 Cancellation of Contract

It has been seen that due to COVID-19 pandemic effect many of the contracts are getting cancelled. In some of the situations, tax invoice has been issued and taxes have also been paid and in some of the cases advances have been received and accordingly taxes have been paid on it. Where such contracts are getting cancelled under different situations, what is to be done by the assessee under GST has been discussed in this chapter.

1.1 Tax Invoice has been issued – GST has been deposited – Services are not rendered as contract is cancelled

In some of the cases, tour is getting cancelled or events got cancelled or banquet function got cancelled due to the lockdown and pandemic situation around the world whereby supplier has already issued tax invoice before the supply of services and as per the provisions tax has also been paid to the government. Now thereafter, where contract is cancelled for supply of such services; Can assessee apply for refund of taxes? or Can he issue credit note? or Can he issue refund voucher?

Section 31 of CGST Act, 2017 provides for issuance of tax invoice. As per the provisions, tax invoice for goods shall be issued at the time of removal of goods, where supply involves movement of goods and in other cases, it is the delivery of goods or making it available to the recipient. In case of supply of services, tax invoice shall be issued before or after the provision of service. Therefore, in some of the cases, supplier of service has issued the tax invoices prior to rendering of service.

In such cases one shall analyse the provisions relating to the issuance of credit note as tax invoice has already been issued by the supplier of service. As per Section 34 credit notes can be issued only in the situations as provided under sub-clause (1) of section 34, which reads as follows:

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| GST Issues & A Way Forward Amidst COVID-19 by Monarch Bhatt, Advocate |

“SECTION 34. Credit and debit notes. —

(1) [Where one or more tax invoices have] been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient [one or more credit notes for supplies made in a financial year] containing such particulars as may be prescribed.”

In view of the above, credit notes can be issued-

A.1. Where tax invoice has already been issued AND

B.1 Excess taxable value has been charged in respect of supply OR

B.2 Excess tax has been charged in respect of supply OR

B.3 Goods which were supplied are returned back by the recipient OR

B.4 There is deficiency in supply of goods or services or both as supplied by the supplier.

In the present case, tax invoice has already been issued and taxes have also been paid on it. Therefore, one of the conditions for issuance of credit note has been satisfied as tax invoice has been issued by the supplier. Further, in my view, cancellation of contract is effectively resulting into excess charging of taxable value on tax invoice. Hence, both the conditions for issuance of credit note has been satisfied. Therefore, in my view where tax invoice has been issued and subsequently due to COVID-19 contract has been cancelled one can issue credit note. In addition, in my view as a documentary evidence, it is advisable that cancellation deed shall be executed between the supplier and recipient.

Similar, issue has also been clarified by board vide circular number 137/07/2020-GST, dated April 13, 2020 where serial number 1 of para. 2 reads as under:

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“Issue: An advance is received by a supplier for a Service contract which subsequently got cancelled. The supplier has issued the invoice before supply of service and paid the GST thereon. Whether he can claim refund of tax paid or is he required to adjust his tax liability in his returns?

Clarification: In case GST is paid by the supplier on advances received for a future event which got cancelled subsequently and for which invoice is issued before supply of service, the supplier is required to issue a “credit note” in terms of section 34 of the CGST Act. He shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim.

However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.”

The second paragraph of the clarification has created another controversy that where assessee is having no output tax liability is it mandatory to apply for refund? or assessee can adjust such excess payment in the subsequent months? It is to be noted that in this regards board has also issued the clarification earlier, where it was clarified that if after adjusting the credit notes issued during the month taxes payable by the assessee goes into negative, assessee shall use such credit notes in subsequent months as return cannot be filed with negative value. The circular dated 13.04.2020 providing clarification to apply for the refund has been issued considering the fact that if assessee does not see any such output tax liability in near future and want that money back, assessee can apply for the refund. However, if assessee want to adjust it against the future month’s liability, assessee can also do so and it is not mandatory to apply for the refund. The similar view shall also be taken even if there is liability and after adjusting the credit notes still there is balance to be adjusted as credit notes value is more than the liability payable during the month and in such situations also balance amount of credit notes can be adjusted against the subsequent

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month’s liability and it is not mandatory to apply for the refund.

In view of above, it is optional for the assessee where assessee can decide whether they want to take refund or they want to adjust such credit notes against the output tax liability of subsequent months.

1.2 Advances received – Advance Receipt Voucher is issued – GST has been deposited – Contract is cancelled

In some of the cases, tour is getting cancelled or events got cancelled or banquet function got cancelled due to the lockdown and pandemic situation around the world whereby supplier has not issued tax invoice but since supplier has received the advances they have issued advance receipt voucher and taxes have also been paid on it. Now thereafter, where contract is cancelled for supply of such services; Can assessee apply for refund of taxes? or Can he issue credit note? or Can he issue refund voucher?

As discussed in para. 1.1 above, credit note can be issued only where tax invoice has been issued by the supplier. However, in the present case tax invoice has not been issued instead advance receipt voucher has been issued as provided under section 31. Therefore, credit note cannot be issued in the present case as tax invoice has not been issued.

The relevant clauses of section 31 for receipt voucher reads as under:

SECTION 31. Tax invoice. —

(1) ……………………………

(2) ……………………………

(3) Notwithstanding anything contained in sub-sections (1) and (2) —

(d) a registered person shall, on receipt of advance payment with respect to any supply of goods or services or both, issue a receipt voucher or any other document,

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containing such particulars as may be prescribed, evidencing receipt of such payment;

(e) where, on receipt of advance payment with respect to any supply of goods or services or both the registered person issues a receipt voucher, but subsequently no supply is made and no tax invoice is issued in pursuance thereof, the said registered person may issue to the person who had made the payment, a refund voucher against such payment;”

In view of the above, where advances have been received and taxes have been discharged but subsequently where supply has not been made and tax invoice has not been issued, assessee shall issue refund voucher.

In the present case, where assessee has received advances and accordingly receipt voucher has been issued and taxes have also been paid but subsequently no supply has been made as contract for such supply has been cancelled. Therefore, in such situation, assessee shall issue refund voucher.

The same has also been clarified by the board vide circular number 137/07/2020-GST, dated April 13, 2020 where serial number 2 of para. 2 reads as under:

“Issue: An advance is received by a supplier for a Service contract which got cancelled subsequently. The supplier has issued receipt voucher and paid the GST on such advance received. Whether he can claim refund of tax paid on advance or he is required to adjust his tax liability in his returns?

Clarification: In case GST is paid by the supplier on advances received for an event which got cancelled subsequently and for which no invoice has been issued in terms of section 31 (2) of the CGST Act, he is required to issue a “refund voucher” in terms of section 31 (3) (e) of the CGST Act read with rule 51 of the CGST Rules.

The taxpayer can apply for refund of GST paid on such advances by filing FORM GST RFD-01 under the category “Refund of excess payment of tax”. “

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1.3 Advances received – Advance Receipt Voucher is issued – GST has not been deposited and before that contract has been cancelled

In some of the cases, assessee might have received advances in the month of March 2020 but due to lockdown, contract is getting cancelled. Therefore, issue is arising for a consideration is that whether assessee shall discharge GST liability while filing March 2020 GST return and thereafter it is to be adjusted in subsequent months? or assessee can adjust it in the month of March 2020 itself? The question arising because, if assessee can adjust it in the month of March 2020 itself, then there is no additional liability on the assessee and assessee can have cash with him in the pandemic situation.

In my view, assessee can issue refund voucher in such situation in the same month in which he has received the advances. Example: If assessee has received advances in March 2020 and event which was to be conducted in March 2020 has been cancelled, assessee can issue refund voucher in the month of March 2020 itself as contract for supply of service itself has been cancelled and no tax invoice has been issued. Further, since assessee is issuing the receipt voucher and refund voucher in the same month. There is no output liability to be discharged by the assessee.

1.4 Advances received for supply of goods – Contract has been cancelled – Assessee retains certain value and returns balance advances – GST is payable on it?

There are cases, where manufacturer had received advances for supply of goods. As per the GST provisions, advances received for supply of goods are not liable for the payment of GST. Hence, liability of GST was not discharged by the assessee on advances. However, before supply of goods contract got cancelled as manufacturer could not manufacture the goods due to lockdown situation and returns the advances after reducing some of the value. Example: contract was for the value of 1 crore for which 25 lakhs was received as advances and assessee returned 15 lakhs and retained 10 lakhs with him as he already incurred certain expenses for manufacturing of such goods.

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The assessee has not supplied the goods and therefore question of GST liability does not arise on supply of goods which is of 1 crore in the given example. The question arising for a consideration is that whether GST is payable on the value which has been retained by assessee which is 10 lakhs in given example? Can it be considered as tolerating an act of receiver for cancelling contract and getting covered under entry 5 (e) of schedule II?

The relevant entry 5 (e) of schedule II reads as under:

“Schedule II | Activities [or transactions] to be treated as supply of goods or supply of services

5. Supply of services

The following shall be treated as supply of services, namely:—

(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; “

It is to be noted that schedule II is only for classification, whereby activity can be considered as supply of goods or supply of services. It does not per se provides that activity stated under schedule II shall be a deemed supply. Hence, first of all activity must be supply as provided under section 7 of CGST Act, 2017. The retrospective amended section 7(1) and newly inserted sub section (1A) under section (7) reads as under with effect from the introduction of GST i.e. 01.07.2017.

“SECTION 7. Scope of supply. —

(1) For the purposes of this Act, the expression “supply” includes —

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

(b) import of services for a consideration whether or not in the course or furtherance of business; [and]

(c) the activities specified in Schedule I, made or agreed to be made without a consideration; [* * *]

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[(d) * * *]

[(1A) where certain activities or transactions, constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.]”

It is evident from the above that activity must be supply as per subsection (1) of section 7 and to constitute it as supply it must have been agreed to be made for consideration. The term “agreed” shall be analysed by taking into consideration the contract which was entered between the supplier and receiver. In the present case, supplier i.e. manufacturer never entered into a contract to retain or forfeit the amount, contract was entered to supply the goods after manufacturing. Therefore, retaining an amount does not by itself becoming supply under section 7 of CGST act, 2017. Therefore, in my view the same are not alible for the payment of GST. However, one shall take into consideration that in many of the cases advance ruling authority has taken contrary view and held that it is liable for the payment of GST. Some of the decisions which were pronounced prior to such retrospective amendments are as follows:

• Zaver Shankarlal Bhanushali = 2018 (14) G.S.T.L. 429 (A.A.R. - GST)

• Goa Industrial Development Corporation = 2020 (32) G.S.T.L. 403 (A.A.R. - GST - Goa)

• Rashtriya Ispat Nigam Ltd. = 2020 (32) G.S.T.L. 492 (A.A.R. - GST - A.P.)

In view of the above, in the present case, in my view manufacturers are not liable for the payment of GST on the amount retained by them i.e. 10 lakhs as it does not constitute supply as provided under section 7 of CGST Act, 2017.

mmm

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Chapter 2 Reduction or Waiver of Rent

In India now a days, majority of the restaurants, international brands, electronic stores, grocery shops, all are operating their business on rental model and due to lockdown they have discussed with mall owner or landlord or lessor for reduction of rent or for waiver of rent. In this chapter we have discussed about the GST liability arising due to such reduction or waiver of rent.

2.1 Lessor reducing rent – By entering into Supplementary Agreement

In some of the cases, lessor and lessee have mutually decided to reduce the rent for which they have also entered into supplementary agreement.

Under GST, section 2(33) of CGST Act, 2017 provides for the definition of “continuous supply of services” which reads as under:

“SECTION 2 (33)

“continuous supply of services” means a supply of services which is provided, or agreed to be provided, continuously or on recurrent basis, under a contract, for a period exceeding three months with periodic payment obligations and includes supply of such services as the Government may, subject to such conditions, as it may, by notification, specify;”

Therefore, as per section 2(33) of CGST Act, 2017, supply of renting of immovable property which is to be provided for a period of more than 3 months are to be considered as a continuous supply of services.

As per sub section (5) of section 31, in case of continuous supply of service, tax invoice shall be issued and when it shall be issued

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has also been enumerated under the said section, which reads as under.

“31(5) Subject to the provisions of clause (d) of sub-section (3), in case of continuous supply of services, —

(a) where the due date of payment is ascertainable from the contract, the invoice shall be issued on or before the due date of payment;

(b) where the due date of payment is not ascertainable from the contract, the invoice shall be issued before or at the time when the supplier of service receives the payment;

(c) where the payment is linked to the completion of an event, the invoice shall be issued on or before the date of completion of that event.”

Generally, all the contracts for renting of immovable property, which is for more than 3 months provides for the date of payment and accordingly as per the provisions, tax invoices shall be issued on or before the date of payment as mentioned in the agreement. If it has been mentioned that rent is payable on completion of period, tax invoice shall be issued on or before the completion of rental period. In other cases, tax invoice shall be issued before or at the time when he receives the payment.

Therefore, the cases where rent has been reduced assessee shall entered into the supplementary deed and it shall be entered prior to the due date of payment or month or quarter or any period as mentioned in the agreement. Hence in such circumstances, in my view, where supplementary deed has been entered prior to the date on which invoice was supposed to be issued by lessor, then lessor shall charge GST on the reduced value.

2.2 Lessor reducing rent – Without entering into Supplementary Agreement

In some of the cases, lessor and lessee have mutually decided to reduce the rent but they have not entered into any supplementary agreement. In this situation, how GST is to be discharged by the lessor?

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Section 15 of CGST Act, 2017 provides for the value of taxable supply and sub section (3) provides for the discounts which shall not form part of the value of supply. Sub section (3) of section 15 of CGST Act, 2017 reads as under:

“(3) The value of the supply shall not include any discount which is given —

(a) before or at the time of the supply if such discount has been duly recorded in the invoice issued in respect of such supply; and

(b) after the supply has been effected, if —

(i) such discount is established in terms of an agreement entered into at or before the time of such supply and specifically linked to relevant invoices; and

(ii) input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply.”

In view of the above, discounts do not form part of the value of supply in two types of situations. Firstly, when it has been given and duly recorded on the invoice, it does not form part of the value of supply. In other word, discounts which is given before or while issuing the tax invoice is permissible under law and does not form part of the value of supply. Secondly, where it is post sale discount i.e. after issuance of invoice, it is eligible for reduction from the value of supply, when it is as per the agreement, which was entered for the supply as linked with that particular invoice and receiver has reduced the input tax credit to the extent discount has been given post supply. Therefore, discounts do not form part of the value of supply, if it is pre-supply discounts or post supply discounts as discussed above is permissible under section 15 (3).

Therefore, in the present case, where lessor agreed to reduce the rent without entering into supplementary deed but the same has been mentioned on the tax invoice as discounts considering the pandemic situation. In my view such discounts are permissible under the law and GST is payable only on the value after

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reducing the discounts. However, department may object on it which needs to be fight out.

2.3 Lessor reducing rent – As per force measure clause mentioned in Lease Agreement

The cases where landlord is reducing the rent as per the force measure clause as mentioned in the agreement. The first issue arising whether force measure clause is applicable to the present situation or not? In my view, government has already issued order in the month of February 2020 declaring COVID-19 as an act of god and covered under force measure clause. Hence, one can apply the force measure clause. However, one may argue that when discount has been given during the lockdown period it is not covered under force measure clause as it is because of the act of government whereby, lockdown has been announced by the government. Hence, it is highly debatable whether to apply the force measure clause or not but in my view one can apply force measure clause as well, if lessor and lessee have not entered into supplementary agreement.

In my view, applying the force measure clause and determining the rent as per the clause is determination of value of supply during the particular period which is covered and enumerated in the agreement under force measure clause. Therefore, where value itself has been determined as per the clause it becomes the transaction value and GST is leviable only on that particular value.

2.4 Lessor waiving rent – During the lockdown period as announced by the government

There are situations where lessor is waiving the entire rent due to lockdown situation as announced by government. The question arising for a consideration is that whether GST will be payable on it as tolerating an act of lessee for not paying rent and getting covered under entry 5 (e) of schedule II?

The relevant entry 5 (e) of schedule II reads as under:

“Schedule II | Activities [or transactions] to be treated as supply of goods or supply of services

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5. Supply of services

The following shall be treated as supply of services, namely:—

(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; “

It is to be noted that schedule II is only for classification, whereby activity can be considered as supply of goods or supply of services. It does not per se provides that activity stated under schedule II shall be a deemed supply. Hence, first of all activity must be supply as provided under section 7 of CGST Act, 2017. The retrospective amended section 7(1) and newly inserted sub section (1A) under section (7) reads as under with effect from the introduction of GST i.e. 01.07.2017.

“SECTION 7. Scope of supply. —

(1) For the purposes of this Act, the expression “supply” includes —

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

(b) import of services for a consideration whether or not in the course or furtherance of business; [and]

(c) the activities specified in Schedule I, made or agreed to be made without a consideration; [* * *]

[(d) * * *]

[(1A) where certain activities or transactions, constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.]”

It is evident from the above that activity must be supply as per subsection (1) of section 7 and to constitute it as supply it must have been agreed to be made for consideration. The term “agreed” shall be analysed by taking into consideration the agreement which was entered between the supplier and receiver. In the present case, supplier i.e. lessor never entered into an agreement

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to waive the rental amount, contract was entered to supply the property on rental basis. Therefore, waiving an amount does not by itself becoming supply under section 7 of CGST act, 2017. Therefore, in my view the same are not liable for the payment of GST. However, one shall take into consideration that in many of the cases advance ruling authority has taken contrary view and held that it is liable for the payment of GST. Some of the decisions which were pronounced prior to such retrospective amendments are as follows:

• Zaver Shankarlal Bhanushali = 2018 (14) G.S.T.L. 429 (A.A.R. - GST)

• Goa Industrial Development Corporation = 2020 (32) G.S.T.L. 403 (A.A.R. - GST - Goa)

• Rashtriya Ispat Nigam Ltd. = 2020 (32) G.S.T.L. 492 (A.A.R. - GST - A.P.)

In view of the above, in the present case, in my view lessor is not liable for the payment of GST on the waiver of rent as it does not constitute supply as provided under section 7 of CGST Act, 2017.

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Chapter 3 Input Tax Credit

There are number of issues have arisen with respect to the eligibility of various supplies received by the assessee during the pandemic situation. The same has been discussed in this chapter.

3.1 Input Tax credit on Inputs written off

It has been seen that due to lock down and global shut down of almost all industry has affected the consumption of raw materials and stock of inputs have been damaged to large extent during the lockdown period. Now, when assessee is no longer able to use such raw material in further manufacturing of goods question arises for consideration is whether assessee is also required to reverse such input tax credit paid on such inputs?

Section 16 of CGST Act, 2017 provides for the Eligibility and conditions for taking input tax credit. The sub section (1) of section 16 reads as under:

SECTION 16.Eligibility and conditions for taking input tax credit.

(1) Every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business and the said amount shall be credited to the electronic credit ledger of such person.

In view of the above, input tax credit used or intended to be used in the course or furtherance of business is eligible as input tax credit. In the present case also, inputs were procured with intention to use it in the manufacturing of finished goods. Hence, it is definitely in the course or furtherance of business and eligible as input tax credit as provided under section 16. However, section 17 of CGST ACT, 2017 provides for the

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apportionment of credit and blocked credits, where sub clause (5) of section 17 provides for non obstante clause where input tax credit is not eligible to the assessee. The relevant part of section 17(5) reads as under:

“SECTION 17. Apportionment of credit and blocked credits

(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following, namely:—

(h) goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples;”

In view of the above non obstante clause which is having over ridding effect over section 16, clause (h) specifically disallowing the input tax credit of “goods” lost or stolen or destroyed. Further, “goods” written off or disposed of by way of gift or free samples is disallowed. Therefore, on plain reading of section one can say that input ax credit is not eligible to the assessee.

Assessee can also take aggressive view, whereby assessee can challenge it on two primary grounds stating that clause (h) of section 17 (5) is bad in law. Firstly, it is disallowing the input tax credit of only goods and does not talk about similar situations with respect to the services. Secondly, loss incurred by such goods are going to be absorbed by sale of another lot of finished goods and under GST there is no requirement of availing one to one credit and therefore, such restricting provision is bad in law and needs to be struck down.

In my view, assessee shall not reverse the input tax credit in books as government may come up with the amendment or removal of difficulty order to allow the input tax credit of goods damaged during the COVID-19 pandemic situation.

3.2 Input Tax Credit on Input Services which has not been directly used to provide output services as contract for output supply got cancelled

In chapter 1 of this book we have analysed various situations, where contract for the supply of services have got cancelled. Now, the contract for supply of output services are cancelled

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and supplier of services have either not received any amount or he has received the amount and refunded the same or he has retained certain amount with him and further he has undertaken certain input services to provide such output services. Therefore, question arises for consideration is that where contract for output supply is cancelled but assessee has already received many of the services to provide that service but due to COVID-19 contract got cancelled so assessee is entitled to avail and utilise such credit or not? To simplify the issue let us understand with the help of example. Example: Assessee engaged into providing event management services for which he had booked banquets and decorator’s services. However, due to COVID-19 event got cancelled and hence assessee has not provided any output supplies. But assessee has booked banquets for which he had also paid advances but assessee did not used that banquet as event got cancelled where he did not get refund and hotel issued tax invoice to the extent advances received from assessee. Assessee paid to the decorator to the extent pre-decoration services such as 3D images of decoration, flex banner services, movie clip preparation, etc. provided by the decorator. In this situation, whether assessee is entitled to avail and utilize the input services received from hotel and decorator though it has not been used to provide that services as event got cancelled?

As per section 16 of CGST Act, 2017, input tax credit used or intended to be used in the course or furtherance of business is eligible as input tax credit where assessee shall also satisfy the following conditions:

• Assessee shall be in possession of tax invoice or debit note, and

• Assessee have received the goods or services or both, and

• Tax charged in respect of the supply has been actually paid to the government, and

• It has reflected in electronic credit ledger of the receiver, and

• Assessee has filed the return under section 39, and

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• The same is not covered under blocked credit as provided under section 17(5).

In the present case, input services were booked with intention to use it for further supply of output services. Hence, it is definitely in the course or furtherance of business. As stated assessee is also in possession of tax invoice and receiver will also discharge the tax liability and filed their returns. Therefore, the same will also get reflected in the electronic credit ledger of the assessee.

The restriction has also not been imposed under section 17(5) for such type of credit with respect to the input services. We have seen in para. 3.1 above that restriction is there with respect to the goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples. However, similar restriction is not there for input services. Therefore, the case is also free from blocked credit and not covered under section 17(5).

One of the conditions is that assessee must have received the goods or services. Hence, in case of banquet services, in the present case, one can say that assessee has not received the banquet services from hotel as assessee has not received any banquet facility as event got cancelled. However, charge by the hotel itself shows that assessee has received the banquet services as it was available for the assessee and arrangement were made by the hotel for assessee. Hence, services were availed by the assessee though it was not occupied by the assessee on the event day. In my view, in every services there are certain services which takes place even prior to provision of actual services and once value has been charged it is substantial evidence that there was an element of services which were supplied by the hotel. Therefore, the same has also been received by the assessee. With respect to the decorator’s services, he has charged to the extent services were already provided by him and received by the assessee. Hence, assessee has also received the services from the decorator.

In view of the above, in my view, where contract is cancelled for the supply of output services, assessee is entitled to avail and utilise the credit of input services received by them. Hence, in the present case, event management company is entitled to avail and utilise the credit of GST charged by hotel and decorator.

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3.3 Input Tax credit on employee’s Medical Insurance

During COVID-19, many of the states have made it mandatory for the companies to obtain medical insurance of their employee. Therefore, it has become mandatory by companies situated in those states to obtain health insurance of their employees. In other states, many of the companies willingly on their own getting medical insurance for their employee. The issue arising for a consideration is that whether GST paid by the company on the medical insurance of their employee is eligible as input tax credit or not?

In this case, to determine the eligibility of input tax credit for the company important aspect to be analysed is whether it is falling under the blocked credit as provided under section 17 (5) of CGST Act, 2017? The relevant provisions of Section 17 (5) reads as under:

“SECTION 17. Apportionment of credit and blocked credits

(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following, namely:—

(b) the following supply of goods or services or both —

(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance :

Provided that the input tax credit in respect of such goods or services or both shall be available where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;

(ii) membership of a club, health and fitness centre; and

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(iii) travel benefits extended to employees on vacation such as leave or home travel concession:

Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.”

In view of the above, input tax credit on life insurance and health insurance are falling under clause (i) of sub section 5(b) of section 17. Hence, it is covered under the blocked credit. However, proviso to clause (i) and another proviso applicable to entire clause (b) is excluding life insurance and health insurance services from getting covered under blocked credit. Therefore, input tax credit on the following life insurance and health insurance services are eligible and not covered under blocked credit.

The cases where life insurance and health insurance services, have been used for providing further supply of life insurance or health insurance services are eligible for input tax credit. Therefore, if one insurance company is procuring the life insurance or health insurance services from another, such insurance company is eligible for the input tax credit.

As per the other proviso, where it is obligatory for an employer to provide life insurance and health insurance services to its employees under any law for the time being in force, it is eligible as input tax credit. Therefore, the cases, where it is mandatory for the company to provide insurance to their employee, company is eligible for the input tax credit of GST paid on it. Further in my view, it should be obligatory under any other law and not necessary to be under GST law only.

In view of the above two proviso, especially as the proviso which is applicable to entire clause (b) input tax credit of GST paid on the medical insurance of employee is eligible to the tax payer, where it has been made mandatory by the order of the state government and in my view, medical insurance is well covered under the term ‘health insurance’. Further, where health insurance is obtained as per the requirement under the factories

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act, Input Tax Credit can also be claimed by such factory as it is covered under the proviso. However, the tax payer for whom it is not mandatory as per the factories act and not made mandatary by the state government, Input Tax credit is not eligible to such tax payer and it will get covered under blocked credit.

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Chapter 4 Reverse Charge Mechanism

As per section 9 sub section (3) and sub section (4) of CGST Act, 2017, GST is payable under reverse charge mechanism i.e. by receiver of supply. Sub section (3) of section 9 provides for the payment of GST under reverse charge mechanism only on the specified supplies whereas, sub section (4) was for all supplies received from the unregistered suppliers. The said sub-section (4) was in effect only for a limited period of initial 3 months and from 13.10.2017 exemption was granted and thereafter it was in obeyance and later it got amended. Therefore, currently reverse charge is applicable only on the specified supplies received by the receiver. Notification number 13/2017-Central Tax (Rate) provides for the specified supply of services, which are liable for the payment of GST under reverse charge mechanism by receiver of supply. Out of this, the “services from director” and “sponsorship services” are most complex especially due to divergence view by advance ruling authority. The same have been discussed in this chapter.

4.1 Reverse Charge Mechanism on Director’s Fees

Serial number 6 of notification number 13/2017-Central Tax (Rate) dated 28.06.2017 provides for the services from director. The same reads as under:

Sl. No

Category of Supply of Services

Supplier of service

Recipient of Service

(1) (2) (3) (4)

6 Services supplied by a director of a company or a body corporate to the said company or the body corporate.

A director of a company or a body corporate

The company or a body corporate located in the taxable territory.

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In view of the above, services received from the director are liable for the payment of GST under reverse charge mechanism. However, what are those services liable under reverse charge? Whether all the service received from director are covered under reverse charge? All those question needs to be analysed.

Authority of Advance Ruling in the case of M/s. Alcon Consulting Engineers India Private limited reported in 2019-TIOL-378-AAR-GST held that remuneration paid to the director is liable for the payment of GST under reverse charge mechanism. In another advance Ruling in the case of M/s. Clay Craft India Private Limited reported in 2020-TIOL-64-AAR-GST issue came up before the authority was whether directors working in the company and looking into the various activities such as procurement of raw materials, production, quality checks, dispatch of finished goods, accounting, etc. for which they are getting regular salary and other allowances as per the employment contract, then company is liable for the payment of GST under reverse charge on such payments to the director or not? In such case, companies were also deducting TDS on their salary and PF laws were also applicable. The Authority of Advance Ruling held that consideration paid to the directors is against the supply of services provided by director to the company and are not covered under entry 1 of schedule III of the CGST Act, 2017. Further, director are not employees of the company and as per entry 6 of notification number 13/2017-Central Tax (Rate), services rendered by the director to the company for which consideration is paid under any head is liable for the payment of GST under reverse charge mechanism. Therefore, it was held that company is liable for the payment of GST under reverse charge mechanism.

In view of the decisions, advance ruling authority is of the consist view in 2019 and even in 2020 that all the amount paid to the director are liable for the payment of GST under reverse charge mechanism. However, in my view, authority has not discussed in detail that in many of the cases, directors also work as an employee of the company and as per entry 1 of schedule III of CGST Act, 2017 services by an employee to the employer in the course of or in relation to employment are neither supply of services nor supply of goods. Hence, outside scope of supply

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itself. Therefore, once it is outside the scope of supply, again by virtue of notification entry it cannot attract the GST liability. At the same time, notification entry shall also get the meaning as every word under the statute has meaning to it and it cannot simply become redundant by one interpretation. Therefore, in my view, notification entry will cover the cases, where director is supplying the services in his professional capacity.

The issue to some extent has also been clarified by CBIC by issuance of circular number 139/09/2020‐GST dated 10.06.2020 that all amounts paid to the director are not liable for the payment of GST under reverse charge mechanism. Circular says that the cases where company is paying salary and deducting TDS under section 192 of Income Tax Act, 1961 are not liable for the payment of GST under reverse charge mechanism as it is consideration for services by an employee to the employer in the course of or in relation to his employment in terms of Schedule III of the CGST Act, 2017. The cases where director is receiving fees as per the contract for service where even TDS has been deducted under section 194J of the Income Tax Act, 1961 are covered under notification entry and liable for the payment of GST by company as receiver of service.

4.2 Reverse Charge Mechanism on Sponsorship fees

Serial number 4 of notification number 13/2017-Central Tax (Rate) dated 28.06.2017 provides for the sponsorship services. The same reads as under:

Sl. No

Category of Supply of Services

Supplier of service

Recipient of Service

(1) (2) (3) (4)

4 Services provided by way of sponsorship to any body corporate or partnership firm.

Any person Any body corporate or partnership firm located in the taxable territory.

In view of the above, “Sponsorship” services are liable for the payment of GST under reverse charge mechanism by body

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corporate or partnership firm located in the taxable territory. Sponsorship services and advertisement services often gets over lapped upon each other as there is very thin difference between the term “Sponsorship” and “Advertisement” but for the GST prospective both are having different treatments. “Sponsorship” services attract liability in the hands of receiver if recipient is body corporate or partnership firm whereas “Advertisement” services are liable for the payment of GST by supplier of service as forward charge. Therefore, applicability of GST is different for both of these and once it is identified whether it is to be classified as ‘sponsorship’ or ‘advertisement’? One can easily determine the applicability under GST. Hence, it is necessary to understand what could be the distinguishing factor to identify the services as ‘sponsorship service’ or ‘advertisement service’?

4.2.1. Sponsorship Service

The term sponsorship has not been defined under the GST provisions. However, the same was defined under the service tax provisions and as per the service tax provisions sponsorship includes naming an event after the sponsor, displaying the sponsor’s company logo or trading name, giving the sponsor exclusive or priority booking rights, sponsoring prizes or trophies for competition or similar services. Under GST in the absence of any specific definition it will also include the services as covered under service tax regime, where the definition of supply is wide enough to cover all types of supply in the form of sale, transfer, barter, exchange, license, lease, rental or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. Hence in my view, sponsorship will include not only transactions in money but will also include barter transactions or transactions in the form of exchange which is commonly used in sponsorship service. Few of the examples for sponsorship as covered under HSN code 998397 are as follows:

(a) Naming an event after the sponsor. Example: DLF IPL, Jio Filmfare Awards, Lux Zee Cine Awards, Standard Chartered Marathon, etc.

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(b) Displaying the sponsor’s company logo or trading name. Example: Displaying logo of DLF at all the prominent places during IPL matches, displaying DLF on entry tickets of IPL matches, entry gates, on ground, on sitting chairs, etc.

(c) Giving the sponsor exclusive or priority booking rights. Example: Jio will get free entry passes for an entry to Filmfare awards, DLF will get one stand in each of the IPL matches, etc.

(d) Sponsoring prizes or trophies for competition. Example: IPL winner will get the DLF IPL trophy, DLF man of the match award, DLF player of the tournament, Jio best actor award, Jio best film award, etc.

4.2.2. Advertisement Service

Advertisement services has not been defined under GST act or rules but is has been provided under Notification Number 12/2017-CT (Rate) dated 28.06.2017, where definition is only applicable for that notification but in the absence of any specific definition under GST the same shall also be taken into consideration. The definition of “advertisement” as provided in that exemption notification for services reads as under:

(a) “advertisement” means any form of presentation for promotion of, or bringing awareness about, any event, idea, immovable property, person, service, goods or actionable claim through newspaper, television, radio or any other means but does not include any presentation made in person;

Advertisement services are covered under HSN code 99836 under the heading Advertising services and provision of advertising space or time. Therefore, combine reading of scope as provided under HSN code as well as provided under definition shall be taken into consideration.

Advertisement services and few examples of advertisement services includes-

(a) Planning, concept development and execution of the full range of services for an advertising campaign, including

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creating the basic idea for an advertisement, writing the words and scenarios for advertisements, selection of media to be used, design of ads, illustrations, posters, etc., writing of scenarios for advertising movies, placement of advertisements in media. Example – Creating advertisement for soft drink called “Mountain Dew” where wording will be to promote it as “Daar ke aage jeet hai” creating scenes as adventures activity, creating posters with same tag line and so on.

(b) Development and organization of direct marketing advertising campaigns rather than via mass media. Example - Sending advertising and promotional messages directly to consumers through direct mail or by doing calls, etc.

(c) Delivery services of free samples and other advertising material. Example – Free discount coupons with newspaper or Free sample of hair conditioner with any beauty related magazines.

(d) Demonstration and presentation of advertising services at point of sale. Example – Lakme is advertising their products with free trials of lipsticks at Shoppers Stop or lifestyle at their beauty products counter, Advertising about the benefits of Yakult and giving it free to drink at Big Bazar or Dmart.

(e) Advertising also includes purchase or sale of advertising space or time in print media, television, radio, internet. Example - front page advertisement in newspaper, back cover advertisement in journals or magazines or periodicals, sale of advertising space on billboards, buildings, vehicles, sale of advertising space during broadcasting of movies, serials, award functions in TV or theatres or radio.

4.2.3 Sponsorship Versus Advertisement

In view of the above, I am of the view that sponsorship concentrates on the brand building as whole and does not mention about the advantages or disadvantages of products or services whereas, advertisement directly concentrates on the products display and not as such on the display of brand as

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whole. The same can be further analyse with one classic example of beauty contest like Miss India or Mr India contest, which also gets broadcasted on television and on internet as well.

Miss India which is beauty pageant contest has entered into an agreement to name their event as “Lakme Miss India” and even winning title will be given to female as “Lakme Miss India”. In turn, Lakme will provide all the cosmetics required during the entire contest without any charge. Further, all the contestants need to be brought to one venue which needs transportation facility. Kingfisher is becoming transportation partner, where Kingfisher will not get any payment for the traveling tickets offered to the contestants but their name will be displayed on tickets and they will get free entry in the event. Now, when show will be broadcasted on television or on internet Lakme and Kingfisher want to display some clips about their products for which they will be making monetary consideration.

In the above situation, where at all the places beauty pageant contest will be name as “Lakme Miss India” where the brand name has been given to the contest, it is to be considered as sponsorship service provided to Lakme and Lakme as recipient of service liable for the payment of GST on the value of cosmetics provided during the contest. Therefore, here it is sponsorship service through barter transactions. Similarly, Kingfisher providing transportations to contestants and putting Kingfisher name on contest ticket is sponsorship service and kingfisher is liable for the payment of GST as receiver of sponsorship service. However, when Lakme displays their product on television shows before, during or after, Lakme Miss India contest, it will be considered as advertisement service and not sponsorship service as in that Lakme will displays their products such as lipsticks, compact and various range of cosmetic products to their customers. Even during internet broadcasting, it will be the same as advertising service.

4.2.3 In view of the above, one can say that under sponsorship the responsibility ends once event has been named or prizes are distributed with the name of sponsors whereas, advertisement is much more than sponsorship and it includes right from the concept, creativity, preparation and execution of advertisement

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till the display of brand’s products or services on television, newspaper, magazines, video, internet, etc. However, whether the service to be treated as “sponsorship” or “advertisement” is very subjective and solely depends on the contract entered between the party. Hence, this are the few parameters or basics, one can take into consideration while analysing the contracts which requires thorough examinations of contract as now a day company spending crores of rupees on marketing where, sponsorship and advertisement is very common and it’s applicability under GST needs to be identified.

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Chapter 5 Leviability of Interest under GST

Central Board of Indirect Taxes (CBIC) had issued series of tweets and internal circular on 10th February, 2020 to Principal Chief Commissioners and Chief Commissioners for recovery of interest on gross tax liability. As per the circular, contention of the revenue is that interest shall be paid on 100% of the tax payable by assessee before reducing the Input Tax Credit (ITC) available with them. GSTIN wise details of assessee, who have not filed the returns on time and interest has not been paid on the gross tax liability has also been provided to each of the Principal Chief Commissioners and Chief Commissioners for recovery of interest. As per system calculated report, interest due in such cases is amounting of 45,900 crores.

In view of this circular, revenue is asking interest on the gross amount of tax and accordingly, assessees have received notices for payment of interest on the input tax credit which was already available with them even on the due date of filing of GST returns. Example: Company has not filed return for the month of August 2019 on the due date (20.09.2019) and it has been filed on 30.10.2019, where tax liability was of 10,00,000/- and as on 20.09.2019 for the month of August 2019 ITC amounting of 4,00,000/- was already available with company. Hence, company discharged the interest only on 6,00,000/- which was paid by cash while filing GSTR 3B on 30.10.2019. Now revenue, is issuing notices to such assessee for payment of interest on balance 4,00,000/- as interest is payable on the entire 10,00,000/- of the tax liability.

Revenue for their contention to demand the interest on gross tax liability is relying on the decision of Telangana High Court dated 18th April 2019 pronounced in the case of Mega Engineering & Infrastructure Limited Versus Commissioner of C. T., Hyderabad reported in 2019-TIOL-893-HC-TELANGANA-GST

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whereby it was held that interest is payable on the gross tax liability without reducing the ITC. It is to be noted that during this decision, the recommendation of the 31st GST council for introduction of proviso to subsection (1) of section 50 was already there and under para. 41 and 42 of the judgement it clearly speaks about the proposed amendment to be added by way of proviso to section 50 whereby, court has observed that “But, unfortunately, the recommendations of the GST Council are still on paper. Therefore, we cannot interpret Section 50 in the light of the proposed amendment.”

The relevant recommendations of 31st GST council as per the press release dated 22nd day of December, 2018 reads as under:

“2. Amendment of section 50 of the CGST Act to provide that interest should be charged only on the net tax liability of the taxpayer, after taking into account the admissible input tax credit, i.e. interest would be leviable only on the amount payable through the electronic cash ledger.”

In view of the above, Telangana High Court in the case of Mega Engineering has not taken into consideration proviso to be added under sub section (1) of section 50. Hence, at that particular time, it was pronounced without considering the proposed amendment under section 50 and the decision of mega engineering was prior to such amendment.

In another case of Daejung Moparts Pvt. Ltd. reported in 2019-TIOL-1289-HC-MAD-GST revenue attached the bank account of the petitioner for recovery of interest on the gross tax liability, whereby single member bench on 13th day of June, 2019 held that bank shall pay an amount as admitted by the petitioner and interest shall be paid only on the cash component of the demand belatedly paid and interest liability is not payable on the ITC available with the Department.

Against the said order revenue went into appeal and matter came before the division bench whereby, on 23rd day of July, 2019 reported in 2019-TIOL-1802-HC-MAD-GST both the judges were having difference of opinion about the applicability of interest. Whether it is on the gross tax liability or on net tax liability? Therefore, matter was referred to Hon’ble Chief Justice.

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As per the order of Hon’ble Chief Justice matter was placed before Hon’ble Mr. Justice K Ravichandrabaabu, J as a third judge. In his order dated 19th day of December, 2019 reported in 2020-TIOL-358-HC-MAD-GST it mentions that reference to third Judge has to be made only when two different views are expressed by the Judges in the Division Bench. In this case, except the view on the maintainability of writ appeals, the issue regarding automatic interest liability is not the issue, where two different or contra views are expressed by the Judges. However, specific reference has been made to answer the said two issues and accordingly it was held that though interest liability is automatic, arithmetical exercise needs to be done. The relevant text of para. 29 of the order reads as under:

“…………………….Therefore, in my considered view, though the liability fastened on the assessee to pay interest is an automatic liability, quantification of such liability certainly needs an arithmetic exercise after considering the objections if any, raised by the assessee. It is to be noted that the term “automatic” does not mean or to be construed as excluding “the arithmetic exercise”. In other words, though liability to pay interest arises under section 50 of the said Act, it does not mean that fixing the quantum of such liability can be unilateral, especially, when the assessee disputes the quantum as well as the period of liability. Therefore, in my considered view, though the liability of interest under section 50 is automatic, quantification of such liability shall have to be made by doing the arithmetic exercise, after considering the objections of the assessee.”

Therefore, specifically whether the interest liability is payable on the gross tax liability or on the net tax liability (after reducing the ITC) was not dealt in the decision of Daejung Moparts Pvt. Ltd. but it was held that liability of interest is not automatic. The quantification needs to be done and notice shall also be issued to the assessee, so that objections of the assessee can be taken into consideration.

Recently, in the case of Refex Industries Ltd reported in 2020-TIOL-358-HC-MAD-GST it has been held that decision given by Hon’ble justice in the case of Daejung Moparts Pvt. Ltd. is on factual basis and relates to disputed questions of fact

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whereas, the issue raised in the present case is purely of legal issue. Under para. 12 it has been held that ITC was always available with the department and therefore payment by way of adjustment can neither be termed as belated nor delayed. The proper application of Section 50 is one where interest is levied on a belated cash payment but not on ITC available all the while with the department to the credit of the assessee.

Further under para. 15 of the judgement she has relied on the proviso to sub section (1) of section 50 stating that it has been inserted with effect from 01.08.2019 and while pronouncing the decision of Mega Engineering & Infrastructure Limited by the Telagana High Court, the same was not available as it was only proposed by the GST council.

It is to be noted that till the date of publication of this book i.e. 01.07.2020, proviso to subsection (1) of section 50 has not come into effect. On 01st day of August, 2019 only The Finance (No. 2) Act, 2019 has been enacted but said proviso has not come into effect. The same is yet to be made effective under the central and states / union GST Act from the date to be notified by issuance of notification.

In the lights of above, even after Hon’ble Madras High Court’s decision in the case of Refex Industries Limited interest story is not yet over and day by day pronouncements of new decisions making it more interesting. In my view, assessees shall contest such issues as it is a good case to argue. However, department is consistently mentioning that amendment to section 50 would be prospective amendment and therefore, in near future, it would be a real tug of war between assessees and revenue on recovery of interest.

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Chapter 6 Procedural and Compliance Relief

Various GST compliance related reliefs have been announced on 24.03.2020 for which notifications have been issued on 03.04.2020. Thereafter, again series of notifications have been issued to grant procedural and compliance relief. In this chapter, major relief related to compliances and procedural aspects have been discussed which are as follows:


6.2 GSTR 3B Interest & Late Fees Waiver

6.3 GSTR 3B Extension of Due Date - May 2020

6.4 GSTR 3B Extension of Due Date – August 2020

6.5 GSTR 1 Waiver of Late Fees


6.7 E way Bills Extension of Validity


6.9 Annual Returns Extension of Due Date

6.10 Revocation of cancellation of registration

6.11 Reliefs for Composition Tax Payer

6.12 Extension of time for issuance of refund order

6.13 Other Due Dates Extensions

In this chapter, we are not discussing about the powers under which such notifications have been issued as all these are beneficial notifications. Each of these relief are discussed in detail below.

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In December 2018, notification number 76/2018-Central Tax dated 31.12.2018 was issued for reduction of late fees under GST. As per the notification, late fees for delayed filing of GSTR 3B was reduced to Rs. 25 per day, where there is a tax payment and in case tax payment is nil, late filing fees was reduced to Rs. 10 per day. Hence, effectively late fees are Rs. 50 (25 CGST + 25 SGST) where there is tax payment and Rs. 20 (10 CGST + 10 SGST) for nil tax payment. Further, in the same notification one-time amnesty scheme was announced for complete waiver of late fees for those who have not filed their GSTR 3B for the period July 2017 to September 2018 but filing their returns during the period 22.12.2018 to 31.03.2019.

The notification number 52/2020-Central Tax dated 24.06.2020 has amended notification number 76/2018 and fourth proviso has been inserted whereby, second time amnesty scheme has been announced for those assessee who have not filed their GSTR 3B for the period July 17 to January 2020 by the specified due dates but filing their GSTR 3B between 01.07.2020 to 30.09.2020. The benefit of the scheme are as follows:

Particulars Benefit if GSTR 3b filed between 01.07.2020 to

30.09.2020

Tax Payable under GSTR 3B is “NIL”

100% waiver from late fees

Other than “NIL” Tax payable Maximum late fees Rs. 500/-

(Rs. 250 CGST + Rs. 250 SGST)

(Reference Notification Number 52/2020-Central Tax dated 24.06.2020)

6.2 GSTR 3B Interest & Late Fees Waiver

In December 2018, notification number 76/2018-Central Tax dated 31.12.2018 was issued for reduction of late fees under GST. As per the notification, late fees for delayed filing of GSTR 3B was

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reduced to Rs. 25 per day, where there is a tax payment and in case tax payment is nil, late filing fees was reduced to Rs. 10 per day. Hence, effectively late fees are Rs. 50 (25 CGST + 25 SGST) where there is tax payment and Rs. 20 (10 CGST + 10 SGST) for nil tax payment.

On 03.04.2020 by issuance of notification number 32/2020-Central Tax, third proviso was added for conditional waiver of late fees for the period February 2020, March 2020 and April 2020, where waiver was granted based on the aggregate turnover of the previous year.

Thereafter, again on 24.06.2020 notification number 52/2020-Central Tax has substituted third proviso to the original notification number 76/2018 and therefore as of now (till the date of publication of this book on 01.07.2020) the conditional waiver of late fees is applicable as discussed below under 6.2.1 and 6.2.2.

Similarly, for interest payment by notification number 31/2020-Central Tax dated 03.04.2020 first proviso was added to original notification number 13/2017-Central Tax dated 28.06.2020. The said first proviso has again been substituted by issuance of notification number 51/2020-Central Tax dated 24.06.2020.

Therefore, notification number 51/2020 and 52/2020 have been issued for waiver or reduction of Late fees and interest for the month of February 2020, March 2020 and April 2020 for the assessee whose aggregate turnover in the preceding financial year is more than 5 crore and it has waived or reduced late fees and interest for the months of February 2020 to July 2020 for the assessee whose aggregate turnover is upto 5 crore in the preceding financial year. Hence, due date has not been extended for the mentioned period. The bifurcation has been made into two categories based on the aggregate turnover of previous year. The term “aggregate turnover” has not been defined under the notification and therefore same meaning shall be given as it has provided under section 2 (6) of CGST Act, 2017 which reads as under:

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“2(6) “aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess;”

Hence, aggregate turnover is PAN India turnover of the assessee and includes all taxable supplies, exempt supplies, export of goods, export of service but excludes CGST, SGST, UTGST, IGST and Cess. It is to be noted that it includes PAN India turnover and not GSTIN wise turnover.

The two categories for which different conditions are provided for waiver of late fees and interest or reduced rate of interest is based on the aggregate turnover are as follows:

6.2.1 Tax payer having aggregate turnover of MORE THAN 5 CRORE in the preceding financial year

6.2.2 Tax payer having aggregate turnover of UPTO 5 CRORE in the preceding financial year

It is necessary to discuss frequently asked questions with respect to the “aggregate turnover” considering the practical difficulties faced by the assessee.

Query 1: Company having presence across the country and their total turnover of all state cumulatively is exceeding INR 5 crore but individually in few states company’s turnover is less than 5 crore.

Company is falling under which category?

Reply: As per the definition of aggregate turnover, PAN India turnover shall be taken into consideration and not the turnover as per GSTIN wise. Hence, in all the states for all GSTIN company shall follow the conditions of the assessee having turnover more than 5 crore.

Query 2: Total turnover of the company as per their financial is 4.50 crore but as per GST their turnover is INR 5.50 Crore which

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includes stock transfers and cross charge to a branch situated in other states.


Reply: The definition of aggregate turnover has been provided under CGST Act, 2017 which is applicable under GST and as per GST provisions branch transfer and cross charge is taxable supply. Hence, while determining the category in the present case turnover including the stock transfer and cross charge shall be taken into consideration which is more than 5 crore. Therefore, company shall follow the conditions of the assessee having turnover more than 5 crore.

Query 3: Company is having two business verticals in same state for which they are having two separate registrations as business verticals. The total turnover of one business vertical is INR 4 crore and the total turnover of other business vertical is INR 1.50 crore.


Reply: As per the definition of aggregate turnover PAN India turnover shall be taken into consideration and not the turnover as per GSTIN wise even when it is a separate business vertical. Hence, in the present case total turnover of the company including both the business vertical is more than 5 crore and therefore, company shall follow the conditions of the assessee having turnover more than 5 crore.

The conditional waiver of late fees and or reduced rate of interest as provided under all the two categories are as follows:

7.5.1 Tax payer having aggregate turnover of MORE THAN 5 CRORE in the preceding financial year

It is applicable for GSTR 3B to be filed for the month of February 2020, March 2020 and April 2020. It is to be noted that due date for filing of GSTR 3B has not been extended. 100% relief has been provided on the applicability of interest for the first 15 days, which is to be computed from the original due dates and thereafter, interest is applicable at the rate of 9%, only if return is filed on or before the specified dates. If GSTR 3B has not been

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filed within the specified dates, interest is applicable at the rate of 18% from the original due dates as due date for filing of GSTR 3B remains same. Further, benefit of 100% waiver from late fees is eligible to the tax payer, only if return has been filed within the specified dates.

The same has been explained in the table below:

Month Due Date 100% Interest Waiver

Concessional rate of interest

100% waiver of late fees

(1) (2) (3) (4) (5)

Feb 20 20.03.2020 04.04.2020 9% (05.04.20 to 24.06.20)

24.06.2020

Mar 20 20.04.2020 05.05.2020 9% (06.05.20 to 24.06.20)

24.06.2020

Apr 20 20.05.2020 04.06.2020 9% (05.06.20 to 24.06.20)

24.06.2020

Note 1: If assessee does not file GSTR 3B on or before 24.06.2020 as stated above in the last column, he will not be entitled for 100% waiver of late fees.

Note 2: If assessee is filing GSTR 3B after 24.06.2020, interest will be payable @ 18% from the original due dates as mentioned in column 2.

Note: If assessee does not file GSTR 3B as stated above in the last column, he will not be entitled for any waiver of late fees as well as interest will be payable @ 18% from the due date as due dates has not been extended only late fees has been waived.

It is to be noted that as per notification number 57/2020-Central Tax, assessee whose aggregate turnover is more than 5 Crore is also entitled for the concessional or waiver of late fees for the period May 2020 to July 2020. If such assessee is filing his GSTR 3B after the specified dates but files it on or before 30.09.2020, assessee is liable for the payment of Rs. 500 (250 CGST + 250 SGST) as maximum late fees, where there is a tax payment and in case tax payment is nil, late filing fees has been completely waived.

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Frequently asked questions in respect of delay in compliances in various situations have been discussed below.

Query 1: What are the benefits or consequences, if company is filing GSTR 3B for the month of March 2020 on 05.05.2020?

Reply: In this case company is filing GSTR 3B within 15 days from the due date (20.04.2020) of filing of GSTR3B for the month of March 2020. Hence, company is entitled for the 100% waiver on interest and 100% waiver on delayed filing of GSTR 3B for the month of March 2020.


Reply: In this case company is filing GSTR 3B on 16th day from the due date (20.04.2020) of filing of GSTR3B for the month of March 2020. Hence, company is entitled for 100% waiver on interest for the first delay of 15 days but from 16th day it is to be considered as 1st day for computation of interest and instead of 18% interest is payable at the rate of 9% for one day. Further, as company is filing GSTR 3B on or before 24.06.2020, company is entitled for 100% waiver on delayed filing of GSTR 3B.


Reply: In this case company is filing GSTR 3B after 24.06.2020, which is primary condition for availment of concessional rate of interest and waiver of late fees. Company is not complying this primary condition by filing it on 25.06.2020. Therefore, company is liable for the payment of interest at the original rate of 18% from due date (20.04.2020) till 25.06.2020. Further, company is also required to pay late fees for delayed filing of GSTR 3B from due date (20.04.2020) till 25.06.2020.

7.5.2 Tax payer having aggregate turnover of UPTO 5 CRORE in the preceding financial year

It is applicable for GSTR 3B to be filed for the month of February 2020 to July 2020. It is to be noted that due date for filing of GSTR 3B has not been extended. 100% relief has been provided on the applicability of interest, if it is filed within the specified

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dates and thereafter till 30.09.2020 interest is applicable at the rate of 9%. If GSTR 3B has not been filed by 30.09.2020, interest is applicable at the rate of 18% from the original due dates as due date for filing of GSTR 3B remains same. Further, benefit of 100% waiver from late fees is eligible to the tax payer, only if return has been filed within the specified dates.

The monthly dates have been announced in staggering manner for this category of tax payers. Therefore, the same has been explained by way of two different table as per the states.

CLASS B.1 - Tax payer having an aggregate turnover of UPTO 5 CRORE in the preceding financial year whose principal place of business is in the state of Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh or Union territories of Daman & Diu & Dadra & Nagar Haveli, Puducherry, Andaman & Nicobar Islands and Lakshadweep




(1) (2) (3) (4) (5)

Feb 20 22.03.2020 30.06.2020 9% (01.07.20 to 30.09.20)

30.06.2020

Mar 20 22.04.2020 03.07.2020 9% (04.07.20 to 30.09.20)

03.07.2020

Apr 20 22.05.2020 06.07.2020 9% (07.07.20 to 30.09.20)

06.07.2020

May 20 12.07.2020 12.09.2020 9% (13.09.20 to 30.09.20)

12.09.2020

Jun 20 22.07.2020 23.09.2020 9% (24.09.20 to 30.09.20)

23.09.2020

Jul 20 22.08.2020 27.09.2020 9% (28.09.20 to 30.09.20)

27.09.2020

Note 1: If assessee does not file GSTR 3B as stated above in the last column, he will not be entitled for 100% waiver of late fees.

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However, if assessee is filing GSTR 3B after the dates mentioned in the last column but files on or before 30.09.2020, assessee is liable for the payment of Rs. 500 (250 CGST + 250 SGST) as maximum late fees, where there is a tax payment and in case tax payment is nil, late filing fees has been completely waived.

Note 2: If assessee is filing GSTR 3B after 30.09.2020, interest will be payable @ 18% from the original due dates as mentioned in column two.

CLASS B.2 - Tax payer having an aggregate turnover of UPTO 5 CRORE in the preceding financial year whose principal place of business is in the state of Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha or the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi




(1) (2) (3) (4) (5)

Feb 20 24.03.2020 30.06.2020 9% (01.07.20 to 30.09.20)

30.06.2020

Mar 20 24.04.2020 05.07.2020 9% (06.07.20 to 30.09.20)

05.07.2020

Apr 20 24.05.2020 09.07.2020 9% (10.07.20 to 30.09.20)

09.07.2020

May 20 14.07.2020 15.09.2020 9% (16.09.20 to 30.09.20)

15.09.2020

Jun 20 24.07.2020 25.09.2020 9% (26.09.20 to 30.09.20)

25.09.2020

Jul 20 24.08.2020 29.09.2020 9% (30.09.20 to 30.09.20)

29.09.2020

Note 1: If assessee does not file GSTR 3B as stated above in the last column, he will not be entitled for 100% waiver of late fees.

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However, if assessee is filing GSTR 3B after the dates mentioned in the last column but files on or before 30.09.2020, assessee is liable for the payment of Rs. 500 (250 CGST + 250 SGST) as maximum late fees, where there is a tax payment and in case tax payment is nil, late filing fees has been completely waived.

Note 2: If assessee is filing GSTR 3B after 30.09.2020, interest will be payable @ 18% from the original due dates as mentioned in column two.

In view of the above, it is to be noted that due date for GSTR3B to be filed for the month of February 2020, March 2020 and April 2020 has not been extended only conditional waiver of late fees and waiver / reduced rate of interest benefit has been granted to the assessee.




6.3 GSTR 3B Extension of Due Date - May 2020

The due date for filing of GSTR 3B for the month of May 2020 has also been extended as per the aggregate turnover and for the tax payer whose turnover is upto 5 crore has been extended in staggered manner which has been stated above in the above table B.1 and B.2 of para. 6.2.2. Therefore, extension with conditional waiver of late fees and interest for the tax payer upto 5 crore has already been discussed above in 6.2.2.

The due date for the tax payer having an aggregate turnover of more than 5 crore are required to file their GSTR 3B on or before 27.06.2020 which is applicable to all the tax payer across the country. In this case, it is not waiver of late fees but due date itself has been extended.

It is to be noted that as per notification number 57/2020-Central Tax, assessee whose aggregate turnover is more than 5 Crore is also entitled for the concessional or waiver of late fees. If such

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assessee is filing his GSTR 3B after 27.06.2020 but files on or before 30.09.2020, assessee is liable for the payment of Rs. 500 (250 CGST + 250 SGST) as maximum late fees, where there is a tax payment and in case tax payment is nil, late filing fees has been completely waived.



6.4 GSTR 3B Extension of Due Date – August 2020

The due date for filing of GSTR 3B for the month of August 2020 has been extended for the small tax payers whose aggregate turnover in the preceding financial year is upto 5 crore. The same has been extended in staggered manner as per the states in which principal place of business of the tax payer is located. The extended due dates for each of the states are as follows:

Due of Filing of GSTR 3B

Location of Principal place of Business of tax payer whose Aggregate Turnover is upto 5 crore

01.10.2020 Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, Union territories of Daman & Diu & Dadra & Nagar Haveli, Puducherry, Andaman & Nicobar Islands or Lakshadweep

03.10.2020 Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha, the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi

The due date for the tax payer having an aggregate turnover of more than 5 crore are not extended and it remains same which is

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20th of the following month i.e. 20.09.2020 for all the tax payers across the country.


6.5 GSTR 1 Waiver of Late Fees

In January 2018, notification number 04/2018-Central Tax dated 23.01.2018 was issued for reduction of late fees for delayed filing of GSTR 1. As per the notification, late fees for delayed filing of GSTR 1 was reduced to Rs. 10 per day, where there are no outward supply and in other cases it was reduced to Rs. 25 per day. Hence, effectively late fees are Rs. 50 (25 CGST + 25 SGST) where there is outwards supply in a month or quarter and Rs. 20 (10 CGST + 10 SGST) where there is no outward supply in a month or quarter.

On 03.04.2020 by issuance of notification number 33/2020-Central Tax, fourth proviso was added for waiver of late fees for the quarter ending March 2020 and for the months of March 2020, April 2020 and May 2020 if GSTR 1 is filed on or before 30.06.2020.

Thereafter, again on 24.06.2020 notification number 53/2020-Central Tax has substituted fourth proviso to the original notification number 04/2018 and therefore as of now (till the date of publication of this book on 01.07.2020) the late fees for filing of GSTR 1 for the following months or quarter has been waived if it has been filed on or before the dates mentioned in the table below:

Dates Month or Quarter

10.07.2020 March 2020

24.07.2020 April 2020

28.07.2020 May 2020

05.08.2020 June 2020

17.07.2020 January 2020 to March 2020

03.08.2020 April 2020 to June 2020

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Hence, the due date for the filing of all the above GSTR1 has not been extended but late fees has been waived, if returns are filed on or before the said mentioned dates.



As per Rule 36 (4) of CGST Rule, 2017 Input Tax Credit for availment of unmatched invoices / debit notes has been restricted and only 10% of ITC can be availed in excess of matched invoices / debit notes to the extent it has been unmatched. This is required to be done while availing the ITC on monthly basis.

The relief has been provided and this provision has been deferred till September 2020. Therefore, relief has been provided from this provision during the period February 2020 to August 2020 and assessee can avail the ITC available with him without matching it with GSTR 2A report on monthly basis.

The same is required to be matched cumulatively while filing GSTR 3B for the month of September 2020. In other words, while filing GSTR 3B of September 2020, assessee is required to match the ITC for the period February 2020 to September 2020 with GSTR 2A and unmatched ITC needs to be reversed, if it goes beyond 10% of matched ITC of the said period.


6.7 E way Bills Extension of Validity

The validity of all the E way bills generated on or before 24.03.2020 and whose validity is expiring on or after 20.03.2020, have been extended upto 30.06.2020.


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As per the GST provisions, tax payer who is a registered assessee as company are required file their GSTR 1 and GSTR 3B by use of DSC. Such assessee were not allowed to file GSTR 1 and GSTR 3B returns by use of Electronic Verification Code (EVC). The proviso has been added to rule 26 of CGST Rules, 2017 whereby, tax payers registered under Companies Act, 2013 are allowed to file their GSTR 3B by use of EVC facility during the period 21.04.2020 to 30.09.2020 and GSTR 1 by use of EVC facility during the period 27.05.2020 to 30.09.2020.


6.9 Annual Return Extension of Due Date

Under GST, as per section 44 of CGST Act, 2017 assessee are required to file their annual returns for each of the financial year. The filing of annual return for the financial year 2017-2018 and 2018-2019 is optional for registered assessee whose turnover is upto Rs. 2 Crore. The aggregate turnover limit has been enhanced to Rs. 5 Crore for filing of GSTR 9C i.e. reconciliation statement which is to be certified by Chartered Accountant for the financial year 2018-2019.

The due date for filing of annual return for the financial year 2018-2019 was 30.06.2020. The same has been extended till 30.09.2020 for the financial year 2018-2019.


6.10 Revocation of cancellation of registration

Many tax payer’s registration have been cancelled by proper officer as assessee did not filed their returns for a continuous period of six months or assessee has obtained voluntary registration but unable to commence his business within six months from the date of registration and so on. Therefore, order has been issued for removal of difficulty of such tax payers whereby, registration has been cancelled till 12.06.2020,

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application for revocation of cancelled registration can be made within 30 days or 30.09.2020 whichever is later.

Further, in the Finance Bill, 2020 amendment has also been proposed to section 29 and section 30 of CGST Act, 2020 which has not come into effect as on the date of publication of this book i.e. 01.07.2020. The department has issued many notices under section 46 to the return defaulters and thereafter, they have passed assessment orders under section 62. Based on non-compliance of assessment order by the assessee, department has suo-moto initiated the procedure for cancellation of many such registrations. With this proposed amendment the time limit for such revocation application has been extended by 60 days. Therefore, effectively within 90 days from the date of service of cancellation order revocation of cancellation of registration can be done. First 30 days power is with the officer who has cancelled the registration. Thereafter, 30 days revocation application is to be made before the Additional Commissioner or Joint Commissioner and after that till 30 days application to be made before the commissioner.

(Reference Order Number 01/2020-Central Tax dated 25.06.2020 and section 119 and 120 of Finance Bill, 2020)

6.11 Reliefs for Composition Tax Payer

Due Date Form or Return and Purpose

07.07.2020 Form GST CMP 08

Payment by composition tax payers for the quarter ending March 2020

15.07.2020 Form GSTR 04

Composition tax payers Return for the quarter ending March 2020

31.08.2020 Form GST ITC 03

Declaration for intimation of ITC reversal / payment of tax on inputs held in stock, inputs contained in semi-finished and finished goods and capital goods as on the date of opting of composition scheme

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31.08.2020 Form GST CMP 02

Intimation for opting of composition scheme for the financial year 2020 – 2021

6.12 Extension of time for issuance of refund order

As per the GST provisions, officer shall issue refund order within a period of 60 days from the date of receipt of complete refund application. As per Notification Number 46/2020-Central Tax dated 09.06.2020 the time period for issuance of refund order was extended till 15 days after receipt of reply from the registered person or 30.06.2020 whichever is later. However, thereafter again time for submission of reply to notices has been extended till 31.08.2020 and therefore, time for issuance of refund order by officer has also been extended by 15 days after receipt of reply to notice or 31.08.2020 whichever is later.



6.13 Other Due Dates Extension

The general extension has also been provided for other due dates which can be bifurcated into two segments one is from the assessee prospective and other is from the department prospective.

6.13.1 Other due dates extension from assessee prospective:

Time limit for filing of any appeal, reply or application or furnishing of any report, document, return, statement or such other record, by whatever name called, which is required to be filed under GST provisions and such due date is falling during the period 20.03.2020 to 30.08.2020 has been extended to 31.08.2020.

In view of this, the due dates for other returns which is falling during the period 20.03.2020 to 30.08.2020 and not specifically

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provided has also been extended to 31.08.2020. For example, it is also applicable to the following returns.

Due Date Month Return and Purpose

31.08.2020 March 20 to July 20 GSTR 06

Return to be filed by Input service Distributor


Return for Tax Deducted at Source


Return for Tax Collection at Source

31.08.2020 Feb 20 to July 20 GSTR 05

Return to be filed by Non Resident Taxable Person

This extension is not applicable to-

• Time limit for issuance Tax invoice

• Registration

• Filing of GSTR 1 and GSTR 3B returns

• Levy & Late fees, Waiver of late fees

• Interest, penalty & other amounts

• Power to arrest

• Detention, seizure and release of goods & conveyances in transit, etc.

6.13.2 Other due dates extension authority or Commissioner or Tribunal:

Time limit for completion of any proceeding or passing of any order or issuance of any notice, intimation, notification, sanction or approval or such other action, by whatever name called, by any authority, commission or tribunal, by whatever name

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called, under the provisions of the GST Acts has been extended to 31.08.2020, if such due date is falling during the period 20.03.2020 to 30.08.2020.


mmm

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Chapter 7 Possible GST Boosters in near Future

COVID-19 categorised as pandemic by WHO and soon after that various GST related reliefs have been announced on 24.03.2020 for which notifications have been issued on 03.04.2020 whereby reliefs has been provided by extending time limits for various compliances to be made under GST. However, considering the lockdown of 39 days only compliance reliefs are not enough and industry needs to be revived whereby GST is also one of the factor which shall be taken into consideration and there is a need of “GST Booster Package”. The GST booster package should include at least minimum seven points as mentioned below.

7.1 Relaxing provisions relating ITC

7.2 Free flow of CGST credit

7.3 Allowing three months time for availing ITC of 18-19


7.5 GST rate reduction

7.6 Abeyance of anti-profiteering clause

7.7 Payment of GST on quarterly basis

The need of each of these booster package and how it will be beneficial and how it is to be brought has been discussed below in this article.

7.1 Relaxing provisions relating ITC

GST is a destination base consumption tax and tax shall be imposed only on the value addition of goods or services or both. Even under the erstwhile regime courts have consistently held that VAT, Service Tax and Excise is a tax only on the value addition of goods or services as the case may be. Reliance can

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be placed on the decision of Hon’ble Supreme Court in the case of Coca Cola India Pvt. Ltd. - 2015 (38) S.T.R. J274 (S.C.). In the present situation, eligibility of input tax credit shall be maximised.

7.1.1 Works Contract services received by assessee for construction, re-construction, renovation, additions, alterations, repairing, re-construction of an immovable property is not entitled for ITC to the extent it has been capitalised and not further used for supplying works contract service.

Similarly, Goods or services or both received for construction or re-construction, renovation, additions, alterations or repairing of an immovable property is not eligible as an input tax credit to the extent it has been capitalised.

In the case of Chief Commissioner Vs. Safari Retreats Private Limited - 2020 (32) G.S.T.L. J120 (S.C.) delayed on the part of department has been condoned and decision which is favourable to the assessee is now pending before Hon’ble Supreme Court on the very similar issue of eligibility of ITC on goods and services used for construction of mall which are rented out by the assessee. Further, many decisions given by the Authority for Advance Ruling including recent decision of Maharashtra Advance Ruling Authority in the case of M/s. Las Palmas Co-Operative Housing Society Ltd reported in 2020-TIOL-30-AAR-GST ITC of lift replacement has been denied to the residential society.

Therefore, considering the broader prospective of introduction GST, provision needs to be amended to allow the assessee to avail and utilise the ITC of works contract service or goods or services or both used for the construction or re-construction, renovation, additions, alterations or repairing of immovable property.

7.1.2 As per section 17(5) Input Tax Credit is not eligible on goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples.

It is to be re-evaluated as due to lock down and global shut down of almost all industry it has affected the consumption of raw materials and stock of inputs may get destroyed at large extent by the time industry gets re-open and re-start it’s manufacturing

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process. Hence, this provision relating to block credit needs to be amended.

7.1.3 As per section 16(2), ITC is required to be reversed, if payment is not made within a period of 180 days.

Considering the pandemic situation and lockdown of 39 days this proviso under section 16(2) is demanding the relaxation and time limit shall be provided for further period of 60 days in addition to 180 days. Hence, instead of 180 days for temporary period till August 2020 it shall be increased to 240 days instead of 180 days.

7.2 Free flow of CGST credit

GST is a destination base consumption tax and accordingly as per the provisions relating to the place of supply of goods or services or both it is attracting ‘CGST + SGST’ or ‘IGST’.

In the case of Storm Communications Pvt. Ltd reported in 2019 (21) G.S.T.L. 272 (A.A.R. - GST) Advance Ruling Authority has held that guest registered in one state and availing the hotel, banquet and restaurant service in another state are not eligible to avail the ITC of even CGST as GSTIN is state specific.

It is to be re-evaluated and ITC of CGST shall be allowed against CGST and it is not to be linked with the SGST. Therefore, ITC of CGST shall be allowed without any restrictions.

7.3 Allowing three months time for availing ITC of 18-19

As per section 16 (4), input tax credit of invoices or debit notes pertaining to financial year 2018-2019 can be availed by date of filing of September 2019 return or the date of filing of annual return whichever is earlier. The assessee has completed filing of annual return for the period 2017-2018 in first week of February 2020 and the utility of filing of Annual return for the period 2018-2019 was not even made available on the portal by January 2020.

In view of this, the option of filing of annual return was not at all made available to the assessee for the period 2018-2019 and where assessee was allowed to file the annual return for the period 2017-2018 till February 2020 restricting the availment of

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ITC for the period 2018-2019 by September 2019 return is against the spirit of law and in this pandemic situation the option needs to be open at least for a period of three months to avail the credit pertaining to the period 2018-2019.


As per section 34 (2), credit notes pertaining to tax invoices issued during the financial year 2018-2019 can be issued by 30th September 2019 or the date of filing of annual return whichever is earlier.

Generally continuing services such as works contract service, construction of commercial premises or residential premises, it becomes very difficult to identify such issues quickly as after issuance of tax invoice several inspections takes place and thereafter if required credit notes needs to be issued. Similarly, under construction project, cancellation of booking takes place which is very uncertain and whereby developer is required to refund entire booking amount. However, due to the restriction over issuance of credit notes as stated above in such continuing contracts suppliers are not able to adjust GST after end of September for the previous financial year.

In this pandemic situation such industries need to be incentivise and therefore time for issuance of credit notes for the period 2018-2019 shall be allowed at least for a period of three months.

7.5 GST rate reduction

Each of the industry needs to be evaluated considering the impact of COVID-19 and directly affected industry shall be provided with GST rate reduction. Out of many hotels, tours and constructions industry are some of the industry, which have been directly affected. Therefore, GST rate reductions shall be announced considering such industries.

7.5.1 Accommodation Service

Currently accommodation services are attracting GST at the rate of 12% or 18% and if value of supply is upto INR 1,000/- per day or equivalent it is considered as exempt supply.

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GST Rate shall be reduced to boost the industry:

Accommodation upto the value of 2,500/- NIL rate of GST

Accommodation from 2,501/- to 10,000/- 12% GST

Accommodation above 10,000/- 18% GST

7.5.2 Outdoor Catering Service

Currently outdoor catering services provided by the hotel is linked with declared tariff of accommodation service provided by the hotel whereby, if declared tariff for accommodation service is more than 7,500/-, it is attracting GST at the rate of 18% with input tax credit and there is no option to discharge GST at the rate of 5% without input tax credit.

GST Rates to be revised for outdoor catering service and to be de-linked with the declared tariff of accommodation service:

Outdoor catering Service 5% without ITC

Outdoor catering Service 18% with ITC

7.5.3 Banquet Service

Currently banquet services are attracting GST at the rate of 18% which shall be reduced to 12%.

7.5.4 Tour Operator Service

Currently tour operator providing tour services can charge GST at the rate of 5% and value of tour shall include the value of accommodation and transportation services used for providing such tour service. However, tour operator is not entitled for the availment of input tax credit of accommodation and transportation service. Tour operator is only entitled for the availment of ITC if service is procured from another tour operator.

Conditions for charging of 5% GST rates to be re-evaluated for tour operator considering the pandemic effect of COVID-19 across the world which has affected the tourism and therefore

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tour operator shall be allowed to avail the input tax credit of accommodation and transportation service which has been used for providing the tour service.

7.6 Abeyance of anti-profiteering clause

As per Section 171 of CGST Act, 2017, any reduction in rate of tax on any supply of goods / services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices. Accordingly, in the case of Kiran Chimirala vs. Jubilant Food Work Ltd. - 2019 (24) G.S.T.L. J43 (NAPA) National Anti-Profiteering Authority has held that Jubilant Food Work, running business under the brand name of “Domino’s Pizza” has not passed on the benefit of commensurate reduction in GST rates under restaurant service to their guest as provided under section 171. However, thereafter as of now stay has also been granted by Hon’ble Delhi High Court reported in Jubilant Food Works Ltd. vs. Union of India - 2019 (31) G.S.T.L. J90 (Del.)

In the current pandemic situation, anti-profiteering provision shall be kept in abeyance for a period of one year at least and on the other side to protect the receiver of supply, another specific proviso shall be added whereby whoever opting for all these “GST boosters” will not be entitled to increase the value of their supply beyond 5% as compared to the value of their supply in March 2020.

7.7 Payment of GST on quarterly basis

Hotel industry, tour industry and construction industry have been directly affected due to COVD-19. Further, small business enterprises whose turnover is upto five crore are also in cash crunch due to lockdown. Therefore, relief should be given and more time to be provided for discharging GST liability.

Hotel industry, tour industry, construction industry and assessees having turnover less than five crore shall be allowed to discharge their GST liability on quarterly basis till December 2020.

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Conclusion

These are very few pointers and not exhaustive list, which is to be taken into consideration to overcome the pandemic effect of COVID-19. Apart from these many other measures are also required to be announced under GST.

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Chapter 8 List of Notification issued under CGST

The list of important notifications issued under CGST Act, 2017 during the period 2020 are covered with subject of the notification in this chapter for ready reference. It does not cover rate notifications.

Notification Number

Notification Date

Subject

01/2020 01.01.2020 Seeks to bring into force certain provisions of the Finance (No. 2) Act, 2019 to amend CGST Act, 2017

02/2020 01.01.2020 Seeks to make amendment (2020) to CGST Rules.

03/2020 01.01.2020 Seeks to amend the notification No. 62/2019-CT dt. 26.11.2019 to amend the transition plan for the UTs of J&K and Ladakh

04/2020 10.01.2020 Seeks to extend the one-time amnesty scheme to file all FORM GSTR-1 from July 2017 to November, 2019 till 17th January, 2020.

05/2020 13.01.2020 Seeks to appoint Revisional Authority under CGST Act, 2017.

06/2020 03.02.2020 Seeks to extend the last date for furnishing of annual return/ reconciliation statement in FORM GSTR-9/FORM GSTR-9C for the period from 01.07.2017 to 31.03.2018.

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Notification Number

Notification Date

Subject

07/2020 03.02.2020 Govt. notifies due dates for filing Form GSTR-3B by assessee having aggregate turnover of upto Rs. 5 crores in previous FY.

08/2020 02.03.2020 seeks to “Amend the CGST Rules, 2017 to prescribe the value of Lottery”

09/2020 16.03.2020 Foreign airlines notified for filing GSTR-9C for Indian business operations.

10/2020 21.03.2020 Merged UTs of Daman and Diu & Dadra and Nagar Haveli -Tax period, registration, Electronic credit ledger regarding – Transition period – Special procedure laid down.

11/2020 21.03.2020 Special procedure for corporate debtors under IBC, 2016 so as to enable them to comply with GST laws.

12/2020 21.03.2020 Furnishing FORM GSTR-1 for 2019-20waived for specified taxpayers.

13/2020 21.03.2020 E-invoice implementation w.e.f. 01.10.2020.

14/2020 21.03.2020 QR code implementation w.e.f. 01.10.2020.

15/2020 23.03.2020 Seeks to extend the time limit for furnishing of the annual return specified under section 44 of CGST Act, 2017 for the financial year 2018-2019 till 30.06.2020.

16/2020 23.03.2020 Seeks to make third amendment (2020) to CGST Rules.

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Notification Number

Notification Date

Subject

17/2020 23.03.2020 Seeks to specify the class of persons who shall be exempted from Aadhar authentication.

18/2020 23.03.2020 Seeks to notify the date from which an individual shall undergo authentication, of Aadhaar number in order to be eligible for registration.

19/2020 23.03.2020 Seeks to specify class of persons, other than individuals who shall undergo authentication, of Aadhaar number in order to be eligible for registration.

20/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-7 for those taxpayers whose principal place of business is in the erstwhile State of Jammu and Kashmir for the July, 2019 to October,2019 and November, 2019 to February, 2020.

21/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir or the Union territory of Jammu and Kashmir or the Union territory of Ladakh for the quarter October-December, 2019 till 24th March, 2020

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Notification Number

Notification Date

Subject

22/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, and having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or current financial year, for the month of October, 2019 and November, 2019 to February 2020 till 24th March, 2020.

23/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or current financial year, for each of the months from July, 2019 to September, 2019 till 24th March, 2020.

24/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-1 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, for the quarter July-September, 2019 till 24th March,2020.

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Notification Number

Notification Date

Subject

25/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-3B for the months of October, 2019, November, 2019 to February, 2020 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir on or before the 24th March, 2020.

26/2020 23.03.2020 Seeks to extend due date for furnishing FORM GSTR-3B of the said rules for the months of July,2019 to September, 2019 for registered persons whose principal place of business is in the erstwhile State of Jammu and Kashmir, shall be furnished electronically through the common portal, on or before the 24th March, 2020

27/2020 23.03.2020 Seeks to prescribe the due date for furnishing FORM GSTR-1 for the quarters April, 2020 to June, 2020 and July, 2020 to September, 2020 for registered persons having aggregate turnover of up to 1.5 crore rupees in the preceding financial year or the current financial year.

28/2020 23.03.2020 Seeks to prescribe the due date for furnishing FORM GSTR-1 by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or the current financial year, for each of the months from April,2020 to September, 2020.

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Notification Number

Notification Date

Subject

29/2020 23.03.2020 Seeks to prescribe return in FORM GSTR-3B of CGST Rules, 2017 along with due dates of furnishing the said form for April, 2020 to September, 2020

30/2020 03.04.2020 Seeks to amend CGST Rules (Fourth Amendment) in order to allow opting Composition Scheme for FY 2020-21 till 30.06.2020 and to allow cumulative application of condition in rule 36(4).

31/2020 03.04.2020 Seeks to provide relief by conditional lowering of interest rate for tax periods of February, 2020 to April, 2020.

32/2020 03.04.2020 Seeks to provide relief by conditional waiver of late fee for delay in furnishing returns in FORM GSTR-3B for tax periods of February, 2020 to April, 2020.

33/2020 03.04.2020 Seeks to provide relief by conditional waiver of late fee for delay in furnishing outward statement in FORM GSTR-1 for tax periods of February, 2020 to April, 2020.

34/2020 03.04.2020 Seeks to extend due date of furnishing FORM GST CMP-08 for the quarter ending March, 2020 till 07.07.2020 and filing FORM GSTR-4 for FY 2020-21 till 15.07.2020.

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Notification Number

Notification Date

Subject

35/2020 03.04.2020 Seeks to extend due date of compliance which falls during the period from “20.03.2020 to 29.06.2020” till 30.06.2020 and to extend validity of e-way bills.

36/2020 03.04.2020 Seeks to extend due date for furnishing FORM GSTR-3B for supply made in the month of May, 2020.

37/2020 28.04.2020 GST–Much-awaited PMT-09 for transfer of amount from one a/c head to another in electronic cash ledger made effective from 21st April 2020.

38/2020 05.05.2020 Filing of GSTR-3B by EVC by companies during the period 21.04.2020 to 30.06.2020 and NIL GSTR 3B by short messages facility.

39/2020 05.05.2020 Changes made to facilitate registration of IBC cases.

40/2020 05.05.2020 GST-Rule 138- Validity of e-way bills generated during lockdown extended up to 31.05.2020.

41/2020 05.05.2020 GST–Annual return for FY 2018-19-Date extended till 30.09.2020.

42/2020 05.05.2020 GSTR-3B filing-proviso inserted to enable J&K and Ladakh for electronic filing.

43/2020 16.05.2020 Seeks to bring into force Section 128 of Finance Act, 2020 in order to bring amendment in Section 140 of CGST Act w.e.f. 01.07.2017.

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Notification Number

Notification Date

Subject

44/2020 08.06.2020 Furnishing a Nil GSTR-3B return by SMS facility – Rule 67A of CGST Rules notified.

45/2020 09.06.2020 Relief for merged UTs of Daman and Diu & Dadra and Nagar Haveli – Due date extended till 31.07.2020 for compliance.

46/2020 09.06.2020 GST-Rejection of refund claim – Time period for issuance of order u/s. 54 extended till June.

47/2020 09.06.2020 Rule 138- Validity of e-way bill expiring on or after 20.03.2020 extended till 30.06.2020.

48/2020 19.06.2020 Authentication of Form GSTR-1 permitted through Electronic Verification Code (EVC).

49/2020 24.06.2020 Seeks to bring into force Sections 118, 125, 129 & 130 of Finance Act, 2020 in order to bring amendment to Sections 2, 109, 168 & 172 of CGST Act w.e.f. 30.06.2017.

50/2020 24.06.2020 Seeks to make seventh amendment (2020) to CGST Rules

51/2020 24.06.2020 Seeks to provide relief by lowering of interest rate for a prescribed time for tax periods from February, 2020 to July, 2020.

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Notification Number

Notification Date

Subject

52/2020 24.06.2020 Seeks to provide one time amnesty by lowering/ waiving of late fees for non furnishing of FORM GSTR-3B from July, 2017 to January, 2020 and also seeks to provide relief by conditional waiver of late fee for delay in furnishing returns in FORM GSTR-3B for tax periods of February, 2020 to July, 2020.

53/2020 24.06.2020 Seeks to provide relief by waiver of late fee for delay in furnishing outward statement in FORM GSTR-1 for tax periods for months from March, 2020 to June, 2020 for monthly filers and for quarters from January, 2020 to June, 2020 for quarterly filers

54/2020 24.06.2020 Seeks to extend due date for furnishing FORM GSTR-3B for supply made in the month of August, 2020 for taxpayers with annual turnover up to Rs. 5 crore.

55/2020 27.06.2020 CBIC further extends due date of compliance from 29.06.2020 to 30.08.2020.

56/2020 27.06.2020 CBIC further extends due date of compliance from 29.06.2020 to 30.08.2020.

57/2020 30.06.2020 Late filing of GSTR-3B- waiver of late fee above Rs. 250/- notified.

58/2020 01.07.2020 Seeks to make eighth amendment (2020) to CGST Rules

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Chapter 9 Summary of Important Dates

for GST Compliance

The list of important notifications issued under CGST Act, 2017 during the period 2020 are covered with subject of the notification in this chapter for ready reference. It does not cover rate notifications.

DATES FOR FILING OF GSTR 3B

Class A - Aggregate turnover of MORE THAN 5 CRORE in preceding financial year




(1) (2) (3) (4) (5)

Feb 20 20.03.2020 04.04.2020 9% (05.04.20 to 24.06.20)

24.06.2020

Mar 20 20.04.2020 05.05.2020 9% (06.05.20 to 24.06.20)

24.06.2020

Apr 20 20.05.2020 04.06.2020 9% (05.06.20 to 24.06.20)

24.06.2020

May 20 27.06.2020 N.A. N.A. N.A.

Jun 20 20.07.2020 N.A. N.A. N.A.

Jul 20 20.08.2020 N.A. N.A. N.A.

Aug 20 20.09.2020 N.A. N.A. N.A.

Sep 20 20.10.2020 N.A. N.A. N.A.

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CLASS B.1 - Tax payer having an aggregate turnover of UPTO 5 CRORE in the preceding financial year whose principal place of business is in the state of Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh or Union territories of Daman & Diu & Dadra & Nagar Haveli, Puducherry, Andaman & Nicobar Islands and Lakshadweep




(1) (2) (3) (4) (5)

Feb 20 22.03.2020 30.06.2020 9% (01.07.20 to 30.09.20)

30.06.2020

Mar 20 22.04.2020 03.07.2020 9% (04.07.20 to 30.09.20)

03.07.2020

Apr 20 22.05.2020 06.07.2020 9% (07.07.20 to 30.09.20)

06.07.2020

May 20 12.07.2020 12.09.2020 9% (13.09.20 to 30.09.20)

12.09.2020

Jun 20 22.07.2020 23.09.2020 9% (24.09.20 to 30.09.20)

23.09.2020

Jul 20 22.08.2020 27.09.2020 9% (28.09.20 to 30.09.20)

27.09.2020

Aug 20 01.10.2020 N.A. N.A. N.A.

CLASS B.2 - Tax payer having an aggregate turnover of UPTO 5 CRORE in the preceding financial year whose principal place of business is in the state of Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha or the

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Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi




(1) (2) (3) (4) (5)

Feb 20 24.03.2020 30.06.2020 9% (01.07.20 to 30.09.20)

30.06.2020

Mar 20 24.04.2020 05.07.2020 9% (06.07.20 to 30.09.20)

05.07.2020

Apr 20 24.05.2020 09.07.2020 9% (10.07.20 to 30.09.20)

09.07.2020

May 20 14.07.2020 15.09.2020 9% (16.09.20 to 30.09.20)

15.09.2020

Jun 20 24.07.2020 25.09.2020 9% (26.09.20 to 30.09.20)

25.09.2020

Jul 20 24.08.2020 29.09.2020 9% (30.09.20 to 30.09.20)

29.09.2020

Aug 20 03.10.2020 N.A. N.A. N.A.

DATES FOR FILING OF GSTR 1

Dates Month or Quarter

10.07.2020 March 2020

24.07.2020 April 2020

28.07.2020 May 2020

05.08.2020 June 2020

17.07.2020 January 2020 to March 2020

03.08.2020 April 2020 to June 2020

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DATES FOR COMPOSITION TAX PAYER


07.07.2020 Form GST CMP 08

Payment by composition tax payers for the quarter ending March 2020

15.07.2020 Form GSTR 04

Composition tax payers Return for the quarter ending March 2020

31.08.2020 Form GST ITC 03

Declaration for intimation of ITC reversal / payment of tax on inputs held in stock, inputs contained in semi-finished and finished goods and capital goods as on the date of opting of composition scheme

31.08.2020 Form GST CMP 02

Intimation for opting of composition scheme for the financial year 2020-2021

DATES FOR OTHER GST RETURNS

Due Date Month Return and Purpose


Return to be filed by Input service Distributor


Return for Tax Deducted at Source


Return for Tax Collection at Source

31.08.2020 Feb 20 to July 20 GSTR 05

Return to be filed by Non-Resident Taxable Person

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DATES FOR ANNUAL RETURNS & GST AUDITS 2018-2019

Due Date Period Return and Purpose

30.09.2020 2018 - 2019 GSTR 9 - Annual Return

30.09.2020 2018 - 2019 GSTR 9C - Reconciliation Statement & Certificate

30.09.2020 2018 - 2019 GSTR 9A – Annual Return for Composition Dealer

AMNESTY FOR GSTR 3B – JULY 2017 TO JANUARY 2020

Particulars Benefit if GSTR 3b filed between 01.07.2020 to

30.09.2020

Tax Payable under GSTR 3B is “NIL”

100% waiver from late fees

Other than “NIL” Tax payable Maximum late fees Rs. 500/-

(Rs. 250 CGST + Rs. 250 SGST)

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The Goods & Services Tax Practitioners’ Association of Maharashtra (formerly known as The Sales Tax

Practitioners’ Association of Maharashtra / STPAM) is a State-level body of Sales Tax Practitioners’

established in the year 1951. The Association has its membership spread all over the State of Maharashtra

comprising of Tax Practitioners and other professionals such as Chartered Accountants, Cost Accountants,

Company Secretaries and Advocates practi ing in GST, VAT, Service tax and allied laws. The Association has s

Regional Centres at district places to cater to the needs of members practi ing in various districts of s

Maharashtra.

The STPAM now renamed as GSTPAM is governed by its own constitution and is registered with the Charity

Commissioner and also under the Societies Act. The elected President, Officer Bearers and 15 members of

the Managing Committee conduct the activities of the Association.

Its main object is to educate the public in general and the members in particular on Indirect Taxes operative

in the State of Maharashtra and whole of India.

Last but not the least, whenever our motherland faces natural calamities or neighbour’s aggression, the

Association is always in the forefront to render monetary help.

The highlights of activities of GSTPAM are as under :

1. Publication of its journal ‘GST Review’ on 25th of every month, which include articles by various

eminent personalities along with important Judgments, Circulars and also contains section o Replies n

to Queries of members.

2. Maintaining up-to-date library with the latest and important books on Sales Tax, Allied Laws and all

other books and e-library.

3. Holding Study Circle Meetings, Workshops, Seminars/Conferences, and Non-Residential and

Residential Refresher Courses in India and abroad for members & general public.

4. Holding ‘Guidance Cell Meetings’ at Mazgaon Library.

5. Circulation of Short Notes on Tribunal decisions and full text of important Tribunal decisions.

6. Conducting coaching class , holding Mock Tribunal , orientation course and Intensive Study es s s

Course .s

7. Make Representations to appropriate authorities in the interests of trade, commerce and industry.

GSTPAM also represents to various authorities of the State as well as the Central Government, on

issues arising in implementation of the various Indirect Tax Laws and also highlights them about the

practical difficulties faced by the members and dealers at large.

8. GSTPAM has been a member of Advisory Committee of the Government of Maharashtra which is

formed to obtain suggestions and recommendations for proper administration in the interests of

trade, commerce and industry.

9. Publication of GSTPAM News Bulletin on 10th of every month to cover short notes on recent

important decisions of the Maharashtra Sales Tax Tribunal and to provide the news to members about

the activities of the GSTPAM and other relevant information.

10. Members can also login to the website ‘www.gstpam.org’. It contains the Sales Tax Review, News

Bulletin, Trade Circulars, Acts, Rules, Notifications, DDQs, Important Judgments etc. Members can

also get information about forthcoming events of the Association & latest updates on the ever

evolving law.

11. The Study Material distributed at various events of GSTPAM like Intensive Study Circles, Coaching

Classes, Workshops, and other events are available on website to all members post login. The videos

of the presentations made by eminent faculties at the GSTPAM Study Circle Meetings/Seminars are

regularly uploaded on the website and are also accessible on the YouTube channel of GSTPAM.

ABOUT GSTPAM

Vision Statement...Dinesh M. Tambde Raj P. Shah Hon.treasurer Hon. Jt. Secretaries Aalok K. Mehta...

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Transcript of Vision Statement...Dinesh M. Tambde Raj P. Shah Hon.treasurer Hon. Jt. Secretaries Aalok K. Mehta...