GST returns comprises of two types of returns – periodic and annual returns. Periodic returns are monthly or quarterly returns for reporting transactions during the month or quarter, while annual return is for reporting the summary of the periodic returns filed during a financial year. As the annual return is last return of the year thus, it assumes special significance.
In terms of Section 44(1) of the CGST Act, 2017, every registered person, other than an Input Service Distributor, a person paying tax under Section 51 (TDS Collector) or Section 52 (TCS Collector), a casual taxable person and a non-resident taxable person, shall furnish an annual return for every financial year on or before the 31st day of December following the end of such financial year. Recently the Government vide Notification No. 39/2018 – Central Tax dated September 4, 2018, had notified GST Annual Return Formats viz., GSTR-9 (for regular taxable persons) and GSTR-9A (for composition supplier). Accordingly, for the financial year 2017-18, last date for filing annual return would be
31st December 2018. However, unfortunately till date, utility for filing annual return in Form GSTR-9 has not been introduced by GSTIN. GST Law requires that “every registered person” is required to file annual return, it means, if tax payers are having NIL turnover or exempted turnover, it is mandatory for such tax payers to file annual return. Further, mandate to file annual returns is for each registered person and hence if tax payer is having different registration numbers for their unit located in SEZ area or had obtained registration as different business vertical though in same State, annual return have to be furnished within stipulated time period for each such registration.
Tax payers are expected to fill in 19 tables comprising of 6 parts in the annual return and all the details are to be extracted / compiled from the periodic returns (GSTR-1 & GSTR-3B) submitted or filed for the period July 2017 to March 2018. Hence, if any mistake or omissions here been committed by tax payers, at the time of filing these periodic returns and not rectified during the period under consideration, details have to be filled in with same mistakes and omissions.
In Tables 4 and 5 of the annual return, instruction sheet of the annual return state that tax payers are expected to compile details from the periodic return GSTR-1 filed by them. GSTIN portal, at present, only provides summary of details filed by the tax payers and hence it would be difficult for the tax payers to compile details from the return filed by them in GSTIN portal. GSTIN had provided the facility of offline facility to download GSTR-1 but it is only for viewing purpose and cannot be exported in any other format. Hence, it is expected that GSTIN will bring change. Accordingly, tax payers have to completely rely on the data generated and preserved by them. Let us try to understand from the following table, how data are to be once again extracted to fill up the details in Table 4 & 5 of annual return.
|Table. No.||Content of Table||Data appeared in GSTR-1||Data appeared in GSTR-3B||Challenge|
|4B||Supplies to registered persons – B2B||Table 4A & 4C||Table 3.1(a)||In GSTR-3B it includes transactions of Deemed exports|
|4C & 5A||Zero rated supply (exports) with & without payment of tax||Table 6A||Table 3.1(b)||Export turnover supplies may not be matched with Export turnover as per financial statement due to exchange rate difference. [Rule 34 of CGST vs. AS-11 & Ind AS 21]|
|4D & 5B||Supply to SEZ with & without payment of tax||Table 6B||Table 3.1(b)||GSTIN portal accepts transactions of supplies to SEZ units at Table 4A (B2B supplies) in Form GSTR-1. Hence, details to be compiled separately|
[amended N. No. 70/2017 from
However, it reflects in Table 4A
|Table 3.1(a)||In GSTR-3B such transactions are included in Table 3.1(a) – B2B transaction. Hence, details to be compiled separately|
|5D, E & F||Exempted, NIL rated & Non-GST Supply||Table 8||Table 3.1 (c)||Instruction sheet provides value of “no supply” shall also to be declared. Big challenge to compile data, which do not attract GST|
Part III contains 3 Tables viz., Tables 6, 7 & 8. Tax payers are required to fill in the details of all Input Tax Credits availed and reversed in the financial year for which annual return is to be filed from the periodic return filed in Form GSTR-3B. While providing details of Input Tax Credits in Tables 6B to 6G, further bifurcation is expected in respect of ITC related to Inputs, Capital Goods (CG) and Input Services (IS). At the time of filing periodic returns, such bifurcation was not required to be provided and hence now again tax payers have to compile input tax credits used as Inputs, CG and IS. At Tables 6K & 6L, details in respect of ITC availed through TRAN-I and TRAN-II are required to be provided. Such details are not forming part of the periodic return and hence compilation needs to be done from the Electronic Credit Ledger (ECL). Accordingly, transition credit received in ECL needs to be reported. In Table 6H, details of ITC reclaimed have to be reported as pursuant to S. 16(2) of CGST Act, if taxpayer does not pay the supplier within 180 days then such ITC would be reversed. But same would be eligible once the payment is done. In Table 7A, details of ITC reversed due to non-payment of consideration to suppliers need to reported and such reversal have to be by way of enhancing the output tax liability for the month in which such reversal is carried out. [Rule 37 (2)]. Accordingly, tax payers might have shown in periodic returns (Form GSTR-3B) in Table 3.1(a) and hence data has to be segregated and compiled separately from the internal working prepared at the time of filing of return.
In Table 8A, total credits available for inward supplies received during 2017-18 and reflected in Form GSTR-2A (Tables 3 & 5 only) shall be auto populated. It is an undisputed fact that details in Form GSTR-2A changes moment the supplier uploads or files return (GSTR-1) and hence every day and every hour, such credits change. Hence, a clarification is required as regards date on which such credit would be reflected in GSTR-9. Whether date would be date of preparing the annual return by tax payer or the date as of 31st March 2018? In Table 8C, tax payers who had not entered their inward supplies (other than imports and tax payable under reverse charge), for the financial year 2017-18, in periodic return (GSTR-3B) due to any reason, they had a chance to enter such inward supplies (other than imports and tax payable under reverse charge) in the periodic returns (GSTR-3B) till the return for the month of September following the end of the financial year (i.e. GSTR-3B for the month of September 2018) to which such details pertains or furnishing of the annual return, whichever is earlier. If any inward supplies, imports, which pertains to financial year 2017-18, is not recorded for any reason, such imports have to be recorded along with recorded imports at Table 8G (IGST paid on import of goods). Unfortunately, there is no separate space where, any imports and inward supplies on which tax is payable under reverse charge, and such inward supplies are not recorded in the periodic returns (GSTR-3B) for the financial year 2017-18 but tax is discharged in periodic returns (GSTR-3B) during the period April 2018 to September 2018. Resultantly, it appears that input tax credit in respect of such transactions (imports & inward supplies on which tax is payable on reverse charge basis) will be lost or lapsed (Table 8K). In Table 8K of annual return, it will determine the quantum of Input tax credit lapse. System had been designed in such a manner that tax payer will be eligible to avail the Input tax credit as it is available in the GSTR-2A and out of the available or reflected Input tax credit in GSTR-2A, ITC which are not claimed and ITC which are ineligible, would be lapsed. Unfortunately, system had not considered the situation wherein tax payers may be having higher input tax credits but their suppliers may not have filed the returns resultantly lower input credits reflected in GSTR-2A. However, tax payers have to take solace that annual return is only a compilation of details and its effect is not reflected anywhere i.e. in reconciliation statement (Form-9C)
In Part VI – Table 16, tax payers are expected to compile following details whether or not it has been reflected in while filing their periodic returns GSTR-3B.
|Table. No.||Content of Table||Data appeared in GSTR-3B||Challenge|
|16A||Supplies received from Composition Tax payers. (Inward supplies)||Table 5||Table 5 contains consolidated details of (i) supplies from Composition tax payers; (ii) Exempt, and NIL rated supply.|
|16B||Deemed supply under section 143||–||These details were not to be shown separately while filing returns. Further details to be provided though not shown in returns.|
|16C||Goods sent on approval basis but not return||–|
In Part VI – Table 17 & 18, tax payers are expected to provide details of outward and inward supplies against a particular HSN code to be reported in both this table. Tax payers can compile this detail for outward supplies from Table 12 of GSTR-1. Details of inwards supplies HSN would be of greatest challenge as mostly all tax payers may not have kept these details as GSTR-2 wherein this detail has to be provided was suspended till as of today. Moreover, details of HSN wise inward supplies of goods as well as services would also be a challenging task as exemption had been provided to those tax payers whose turnover is less than INR 1.50 Crores from providing HSN. Hence, now tax payers have to compile details of all inwards supplies of goods and services on the basis of HSN in order to fill the details in Table 18 of Annual Return.
Prima facie perusal of the Annual Return format, it appears that any additional liability arising out of error/omission in GSTR-1 and GSTR-3B cannot be paid at the time of filing annual return. This could be a setback as Industry was looking forward to rectifying all inadvertent mistakes at the time of filing the annual return. Moreover, if errors / omissions are not rectified and additional liability could not be paid through annual return, what is the need to compile all these details which are already with the GSTIN portal. Government can easily combined details which are filled by tax payers of transactions pertaining to 2017-18 but shown in the returns during the period April 2018 to September 2018 in reconciliation statement Form 9C and provide relaxation to tax payers from filing one more additional return.
In October issue of AIFTP Journal Page No. 5 first para Late Justice Dr. B. P. Saraf, the former Chief Justice of India is wrongly printed. He was the former Chief Justice of Jammu & Kashmir High Court. The error is regretted.