India @ 75 has one distinct feature. India has transformed from an agrarian economy to service oriented economy since independence. Also it is now the fastest growing economy. Morgan Stanley expects India’s GDP growth to be @ 7% in financial year 2022-23. It is expected to contribute 28% and 22% to Asian and global economic growth.
The GST Council’s next meeting is expected in September, 2022. It is expected to take up two important issues arising out of recent Supreme Court judgments – Circular for non-imposition of IGST on ocean freight and re-opening of window for transitional credit. It may also discuss reports of Group on Ministers. Another important issue of correcting inverted duty structure is also on the cards. States may also push further their demand for compensation towards GST short fall. GoM on GST Appellate Tribunal may submit its report soon. It is learnt that it has finalized the basic framework for setting up of Tribunals. After GST Council’s approvals, Tribunals can be set up in States. So far as GST on gaming and casinos is concerned, no consensus has been arrived out yet.
CBIC (Investigation Wing) last week issued two important instructions / guidelines in relation to arrest & bail in GST law and issuance and handling of summons. While these will provide guidance to field formations, it will also act as a breather to taxpayers to avoid harassment, if any. Looking to the rising number of cases, these instructions were the need of hour.
The Government has clarified that GST would not be applicable on residential units if they are rented out to private person for personal use.
CBIC Chairman has recently stated that Competition Commission of India (CCI) is also likely to take over the role of Anti-Profiteering Authority for such matters by the year end. He has also opined that conceptually, BPOs and KPOs can not be considered as intermediary.
Revenue Secretary, Tarun Bajaj has been given additional charge of Secretary, Ministry of Corporate Affairs for the time being.
Use of DIN by States
- Supreme Court has directed the Union of India and GST Council to issue an advisory to all the States for implementation of Document Identification Number (DIN) in respect of all the notices and communications being sent or issued by State GST offices.
- It has also directed that use of DIN in all GST related documents be implemented at the earliest possible.
- Electronic generation DIN is already in use by the CGST officers which provides authenticity to the documents / communications issued by the Department.
States like Kerala and Karnataka already use DIN.
Transfer of Appeals filed after 30.06.2017- Power delegated to Chief Commissioner
The Central Government has delegated the powers of CBIC for the purpose of transfer of appeals filed after the 30.06.2017 to the Principal Chief Commissioner / Chief Commissioner of Central Excise and Service Tax under Rule 3 of the Central Excise Rules 2017 and Rule 3 of the Service Tax Rules, 1994.
(Source: Notification No. 3/2022-CT (NT) dated 20.07.2022)
GST collection of food businesses license / registration fee / penalty
- w.e.f. 18.07.2022, applicable GST rate on application fee, registration fee, penalty in relation to food businesses / FSSAI license etc shall be @ 18 percent as follows :
| S. No. | Types of Fee / Penalty | Mode of Payment / Portal |
| 1. | Application fee towards
|
Online — FoSCoS https://foscos.fssai.gov.in |
| 2. | Penalty for renewal of license/ registration after expiry date — Central License | Online — FoSCoS https://foscos.fssai.gov.in |
| 3. | Penalty for late filing of annual return towards Central License [wef FY 2020-21] as per clause no 2.1.13 (3) of Food Safety and Standards (Licensing and Registration of Food Businesses) Regulation, 2011. | Online — FoSCoS https://foscos.fssai.gov.in |
| 4. | Penalty for late filing of annual return towards Central License [upto FY 2019-20] as per clause no 2.1.13 (3) of Food Safety and Standards (Licensing and Registration of FoOd Businesses) Regulation, 2011. | Online — FSSAI E-pay portal https://epay.fssai.gov.in/fps/loadindex |
| 5. | Registration fee by -FSM candidates for online examination | Online — Food Safety Mitra Portal https://mitra.fssai.gov.in/loadIndexData |
| 6. | Permissions for using Pre-printed packaging material | Online FSSAI E-pay portal https://epay.fssai.gov.in/fps/loadindex |
- Such GST shall be discharged on reverse charge basis.
- Therefore, No GST is being charged through FoSCoS portal on State License and Registration fee and the Penalties belonging to States/UTs. The same is also printed on the receipt generated through FoSCoS.
(Source: Order F.No. RCD-01001/7/2021-Regulatory-FSSAI-Part (1), dated 27.07.2022 issued by Director, RCD, FSSAI)
GST on Renting of Residential Property
- GST on rent in relation residential property to registered persons is leviable e.f. 18.07.2022 under reverse charge mechanism.
- CBIC has further clarified by way of tweet that:
- Renting of residential unit is taxable only when it is rented to a business entity.
- No GST is leviable when residential unit is rented to a private person for personal use.
- No GST is levaible even if a proprietor or partner of firm rents residential property for personal use.
(Source: CBIC tweets / MoF tweets dated 12.08.2022)
Guidelines for Arrest and Bail under GST
GST-Investigation Wing has issued guidelines for arrest and bail in relation to offences punishable under CGST Act, 2017
- These guidelines emanate from the judgment of Supreme Court dated 16.08.2021 In Siddharth v. The State of Uttar Pradesh & Anr. (2021) 8 TMI 977 (Madras) [SLP (Criminal) No. 5442/2021; Criminal Appeal No. 838/2021]
- Supreme court held that merely because an arrest can be made because it is lawful does not mandate that arrest must be made. A distinction must be made between the existence of the power to arrest and the justification for exercise of it. If the Investigating Officer has no reason to believe that the accused will abscond or disobey summons and has, in fact, throughout cooperated with the investigation we fail to appreciate why there should be a compulsion on the officer to arrest the accused.
- The guidelines provide for:
- Conditions precedent to arrest
- Procedure for arrest
- Post arrest formalities
- Reporting requirements
- For details, Instructions may be referred.
[Source: Instruction No. 02/2022-23 (GST – Investigation) dated 17.08.2022]
New Summon Guidelines
CBIC (GST- Investigation Wing) has issued Instruction No. 3/2022-23 dated 17.08.2022 on issuance of summons u/s 70 of the CGST Act, 2017. Accordingly, following are some of the important points to be noted:
- Where summons are issued by Superintendent, prior written permission of officers not below the rank of DC/AC will be required
- Reasons to be recorded in writing for issue of summons
- Summons to be avoided to call for statutory documents already available on GSTN portal.
- Repeated summons without ensuring service of earlier summons to be avoided.
- Senior management /promoters (CMD, MD, CEO, CFO etc) of company or PSU should not be summoned unless their involvement is suspected or in the first instance.
- Summoned person should be aware as to whether he is being summoned as an accused, co-accused or witness.
- If the person summoned does not cooperate and join investigation even after repeated summons (generally three), complaint shall be filed u/s 172 and 174 of Indian Penal Code (IPC) before the Magistrate.
- For details, Instructions may be referred.
[Source: Instruction No. 03/2022-23 (GST – Investigation) dated 17.08.2022]
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