SOP for Non filers of GST returns- Analysis of CBIC Circular

Here we are going to understand the CGST Circular No. 129/48/2019-GST Dated 24-12-2019 and what are its consequences if not complied by the registered person.

Instructions :-

Here in these article author has tried to make it simpler for understanding purpose and wherever possible try to avoid the language of circular. But for some of the points author has use the circular language for better understanding.

A.  FAQs related to CGST Circular No. 129/48/2019-GST Dated 24-12-2019

Q. What the circular is all about?

A. Circular is all about the Standard operating procedure for non-filers of GST return

Q. Which returns are covered under these circular?

A. Returns under Section 39(Regular returns), Section 44(Annual return) or Section 45 (Final return) of CGST Act, 2017.

Q. What are the consequences if registered person not file any of the return mentioned above?

A. Now Section 46 of CGST Act, 2017 read with rule 68 gives power to issue notice in FORM GSTR-3A to registered person who fails to furnish return as mentioned above.

Q. What after issue of notice in FORM GSTR-3A ?

A. Now the registered person has to file the return within the period of 15 days after issuance of such notice.

Q. What if return not filed even after issuance of notice in FORM GSTR-3A?

A. If Registered person has not file the return even after issuance of notice then the tax liability of such registered person may be determined by the officer on the Best of his judgment u/s 62 of CGST Act, 2017.

Q. Whether any further communications will be issued if tax liability has been determined u/s 62 of CGST Act, 2017?

A. Circular is very clear that no further communication will be issued with respect to tax liability determined u/s 62 of CGST Act, 2017.

Q. What if the registered person has file the return before the issuance of Assessment order (ASMT-13)?

A. If the registered person has file the return before issuance of Assessment order, than such notice shall be deemed to have been withdrawn. 

B. General guidelines for Non filers of GST returns

Following general guidelines have been prescribed in circular to ensure uniformity in the implementation of the provision of law across the field formations.

1. A System generated message would be sent to all the registered person before 3 days of due date of filing the return as an reminder to file the return.

Ex- Suppose if due date is 20-01-2020 then message will be sent on or before the 17-01-2020.

2. Once the due date for furnishing the return under section 39 (regular return) is over, (after 20-01-2019 in our example) a system generated mail / message would be sent to all the defaulters immediately after the due date to the effect that the said registered person has not furnished his return for the said tax period; the said mail/message is to be sent to the authorized signatory as well as the proprietor/partner/director/karta, etc.

3. Five days after the due date of furnishing the return,(from 26-01-2020 onwards in our example) a notice in FORM GSTR-3A (under section 46 of the CGST Act read with rule 68 of the CGST Rules) shall be issued electronically to such registered person who fails to furnish return under section 39, requiring him to furnish such return within 15days from the date of issue of notice in form GSTR-3A.

4. In case the said return is not filed by the filed by the defaulter within 15 days of the said notice (i.e FORM GSTR-3A) the proper officer may proceed to assess the tax liability of the said person under Section 62 (i.e. Best Judgment Assessment) .

Q. How best judgement assessment can be done and what is the base for determining the Tax liability.

A. Proper officer will take into account the material available of which he has gathered and would issue order under rule 100 (i.e. Assessment in certain cases) of the CGST Rules in form GST ASMT 13. Then proper officer will upload the summary in FORM GST DRC-07.

Q. Whether Proper officer can use the details of GSTR-1, GSTR-2A, E-way bills?

A. Yes, the Proper officer can use the details of Form GSTR-1, GSTR-2A and details furnishes in E-Way bills, the proper can also use any other information available under any source including information availed from Inspection u/s 71 of CGST Act.

5. In Case the defaulter has furnished the valid return within the period of 30 days of the service of order in FORM GST ASMT-13, the said Assessment order shall be deemed to have been withdrawn.

6. If the said return is unfurnished after 30 of service of order then Proper officer may initiate proceedings under Section 78 (Initiation of recovery proceedins) and recover under Section 79 (ways of recovery) of CGST Act.

♣ Circular has also clarified that in deserving case the proper officer may resort to Provisional attachment to protect the revenue under Section 83 of the CGST Act before issuance of FORM GST ASMT-13 (Assessment order).

Q. What are other consequences of not filing of return other than mentioned above?

A. Proper officer can initiate the action under sub- Section 2 of Section 29 of CGST Act tion of registration in cases where return has not been furnished in period Section 29.

C. Example related to Standard operating procedure for Non filers of GST returns

Lets, Suppose

Mr. A is a taxable person and his due date for furnishing the return is 20-1-2020.

Now on or before 17-01-2020 Mr .A will receive the reminder Message from the GSTN portal that your return is due on 20-01-2020 for the Month of Dec-2019.

• Now Suppose Mr. A is not able to file his return due to unforeseen circumstances or due to huge tax liability whatever may be the reason.
• Now, from 21-01-2020 Mr. A will get the message from the GSTN portal that you have not file your return for the Dec.2019 on or before 20-01-2020.
• Now, from 26-01-2020 on wards notice in FORM GSTR-3A will be issued to Mr. A due to his non filling of return. FORM GSTR-3A will provide the period of 15 days to file the return from the date of said notice.
• Suppose, notice date is 26-01-2020, than Mr. A need to file his return before 10-2-2020.
• Now, Suppose Mr. A is unable to file the return even before the 10-02-2020 than the proper officer will determine his tax liability on the best of his Judgement and issue the Assessment order ASMT-13 and upload the summary in FORM GST DRC-07.
• Now, if Suppose Mr. A has furnished the return within 30 days of Service of Assessment order than such Assessment order shall be deemed to have been withdrawn.

Author Advice:- If you registered person, then it is better to comply with all the due dates for filling the GST returns. Now the GST department has started to take all strict actions against the Defaulters.

“This article is for the purpose of information and shall not be treated as a solicitation in any manner and for any other purpose whatsoever. It shall not be used as a legal opinion and not be used for rendering any professional advice. This article is written on the basis of the author’s personal experience and provision applicable as on the date of writing of this article. Adequate attention has been given to avoid any clerical/arithmetical error, however; if it still persists kindly intimate us to avoid such error for the benefits of other readers.