In the light of COVID-19 pandemic and the difficulties being faced by the taxpayers, there have been a few relaxations provided by the Government mainly with respect to filing of Returns in FORM GSTR-1, FORM GSTR-3B for the period commencing from February, 2020 till May, 2020. Due date for Annual returns and reconciliation statement for the financial year 2018-19 has also been extended till 30th June, 2020. Late fee is waived for delayed filing of the Annual return and the Reconciliation Statement for financial year 2017-18 and 2018-19 for taxpayers with aggregate turnover less than ₹ 2 crores.
Sub-Rule (2) of Rule 31A has been substituted by way of CGST (Second Amendment) Rules, 2020 whereby the value of supply of lottery tickets has been deemed as 100/128 of the face value of the ticket or the price notified by the organising state, whichever is higher. Certain relaxation is also offered to the Airline Companies where they have been exempted from filing reconciliation statement in FORM GSTR-9C u/s. 44 (2) of the Act r.w. Rule 80(3) of the Rules thereof. The conditions of exemption are as follows:
It is a Foreign airlines company
Covered under Notification issued u/s. 381(1) of Companies Act, 2013
Who have complied with Rule 4(2) of the Companies (Registration of Foreign Companies) Rules, 2014
A Statement of receipts and payments for the F.Y. w.r.t Indian business operations duly authenticated by a Chartered Accountant in India or a firm or a LLP of practising CAs be submitted for each GSTIN by 30th September of the year succeeding the F.Y.
CGST Rules, 2017 amended from time to time have in their recent amendments substituted Rule 25 of the CGST Rules by way of Notification No. 16/2020-Central Tax dated 23.03.2020 which is published on and applicable from 23.03.2020. The said Rule mandates physical verification of the business premises in case of failure of Aadhaar authentication before grant of registration or any other reason which the officer deems fit post registration. Verification Report, Photographs and other documents are to be uploaded on the Portal in FORM REG-30 within 15 working days of such verification. However, the requirement of authenticating Aadhaar Number for registration is not applicable to:
A person is not a citizen of India;
Class of persons other than:
Authorized signatory of all types
Managing & Authorized partners;
Karta of HUF
However, if Aadhaar is not assigned to a person then other modes of authentication are to be offered as per Rule 9. Therefore, only Individuals, Authorized signatories, managing and authorized partners and karta of HUF are required to get authentication done.
Notification No. 30/2020-Central Tax increased the time limit to opt for Composition Scheme. Any Registered person who wants to opt for Composition Scheme under section 10 of CGST Act, 2017 for the year 2020-21 can file intimation electronically in form GST CMP-02 till 30th June, 2020 (Subject to Conditions). Form GST ITC 03 in accordance with the provisions of sub-rule (4) of rule 44 can be filed till 31st July, 2020.
Considering the lock down situation, the Government has relaxed the provisions of Rule 36(4). Therefore, for the GST returns relating to periods from February 2020 to August 2020, ITC as per Books can be claimed without considering the ITC as per GSTR 2A. However, the ITC claimed has to be matched in a cumulative manner with GSTR 2A before filing GSTR 3B of September 2020 with restrictions of Rule 36(4).
Notification No. 34/2020-Central Tax has provided for some key benefits to Compositions Dealers. The statement of details of payment of Self Assessed tax in form GST CMP-08 for January – March, 2020 Quarter can be submitted upto 07.07.2020. The return in form GSTR-4 for FY 2019-20 can be submitted upto 15.07.2020. Other benefits have also been given which are given in the Notification in detail.
The validity of E-Way bill expiring between 20.03.2020 to 15.04.2020 was extended till 30.04.2020. Time period for filing of returns for persons required to deduct tax at source, Input Service Distributors and Non-resident taxable persons for the Month March, 2020 to May,2020 upto 30.06.2020.
Taxpayers required to Collect TCS under Section 52 can furnish statement of Month March, 2020 to May, 2020 upto 30.06.2020. Time limit extended upto 30.06.2020 for various compliances including Notices except for certain provisions. One can refer Notification No. 35/2020-Central Tax for further details.
The Government has further clarified certain issues by way of Circular No. 135/05/2020-GST dated 31.03.2020. They are stated as under:
There are no restrictions on clubbing of tax periods across Financial years for claiming refund. Circular No. 125/44/2019-GST dated 18.11.2019 was modified to that extent i.e. the restriction on bunching of refund claims across financial years shall not apply in light of the decision of the Hon’ble Delhi High Court in the case of M/s Pitambra Books Pvt Ltd. The court held as under:
“Circulars can supplant but not supplement the law. Circulars might mitigate rigours of law by granting administrative relief beyond relevant provisions of the statute, however, Central Government is not empowered to withdraw benefits or impose stricter conditions than postulated by the law.”
Refund of tax paid on supplies other than zero rated supplies. Refund is admissible proportionately in the respective original mode of payment In cases of refund, where the tax to be refunded has been paid by debiting both electronic cash and credit ledgers (other than the refund of tax paid on zero-rated supplies or deemed export), The refund to be paid in cash and credit shall be calculated in the same proportion in which the cash and credit ledger has been debited for discharging the total tax liability for the relevant period for which application for refund has been filed. Such amount shall be paid by issuance of order in FORM GST RFD-06 for amount refundable in cash and FORM GST PMT-03 to re-credit the amount attributable to credit as ITC in the electronic credit ledger.
Refunds of Input Tax Credit under Section 54(3) of accumulated ITC shall be restricted to the ITC as per those invoices, the details of which are uploaded by the supplier in FORM GSTR-1 and are reflected in the FORM GSTR-2A of the applicant. Accordingly, para 36 of the circular No. 125/44/2019-GST, dated 18.11.2019 is modified to that extent.
New Requirement is introduced to mention HSN/SAC in Annexure ‘B’. The applicant is now required to mention HSN/SAC code also which is mentioned on the inward invoices. A distinction is important in view of the provisions relating to refund where refund of credit on Capital goods and/or services is not permissible in certain cases.
Clause (C) of Rule 89(4) has also been substituted recently. Clause (C) defines “Turnover of zero-rated supply of goods”. The Old Provision was as under:
means the value of zero-rated supply of goods made during the relevant period without payment of tax under bond or letter of undertaking, other than the turnover of supplies in respect of which refund is claimed under sub-rules (4A) or (4B) or both;
The New Provision stands as follows:
means the value of zero-rated supply of goods made during the relevant period without payment of tax under bond or letter of undertaking or the value which is 1.5 times the value of like goods domestically supplied by the same or, similarly placed, supplier, as declared by the supplier, whichever is less, other than the turnover of supplies in respect of which refund is claimed under sub-rules (4A) or (4B) or both
The new definition of “Turnover of zero-rated supply of goods” restricts the value of goods up to 1.5 times of the value of similar goods when supplied locally / domestically by the same supplier / similarly situated supplier.
A new Rule 96B has also been introduced requiring the taxpayer to return the refund of unutilised ITC claimed on goods exported where export proceeds are not realised within a time period of specified under FEMA. Amount is to be paid within 30 days from expiry of the said period. If not, then recovery proceedings are initiated under Section 73 or 74 of CGST Act, 2017.
The Government has introduced special procedure under Section 148 of CGST Act, 2017 for Corporate Debtors undergoing special CIRP (Corporate Insolvency Resolution Process) under IBC and management of whose affairs are being undertaken by IRP (Insolvency Resolution Professional). Notification No. 11/2020-Central tax dt. 21.03.2020 was introduced in this regard. Corporate debtor undergoing CIRP shall, from the date of appointment of IRP/RP be treated as DISTINCT PERSON.
Registration is to be taken within 30 days from the date of appointment of IRP/RP. They are required to take registration in each state / UT where the Corporate Debtor was registered earlier. Where RP appointed before Notification, Registration is to be taken within 30 days from commencement of Notification. Registration of Entity undergoing CIRP is not to be cancelled. In case it is cancelled, it should be revoked in case cancellation is within period of revocation of cancellation.
IRP / RP are under an obligation to comply with legal requirements for period after the Insolvency commencement Date. They are not obligated to file returns for pre-CIRP period. First Return is to be filed u/s. 40 of CGST Act, 2017 for the period beginning from the date it became liable to take registration till the date registration has been granted.
IRP/RP are eligible to take inputs on Invoices covering supply of goods / services or both received since appointment of IRP/RP but using the GTSIN of erstwhile Registered person, subject to conditions of Chapter V of the Act, except the provisions of Section 16(4) and Rule 36(4).
ITC by customer of undergoing CIRP: for the period from the date of appointment of IRP/RP till the date of registration or 30 days from the date of Notification, whichever is earlier, a customer shall be eligible to obtain ITC on invoices issued under GSTIN of erstwhile registered person subject to Chapter V of the Act except Rule 36(4).
The amount deposited by IRP / RP in the Electronic Cash Ledger of existing registration from the date of appointment to the date of Notification, shall be available for Refund to erstwhile registration even though Returns for that period has not been filed.
It is important to note here that no coercive action is to be taken against corporate debtor w.r.t. dues prior to insolvency commencement. Such dues are to be treated as “Operational dues”. The said claim is to be filed by the officer before NCLT. Details of supplies made / received and total tax dues pending is to be taken from corporate debtor and to be filed before NCLT. Section 14 of IBC mandates imposition of moratorium period.
These were the few Notifications and Circulars issued for the ease of business and help the taxpayers in these testing times.