Latest Changes in GST and Amendments till September 2022

1. Conditions to be fulfilled to avail the ITC as available in GSTR-2B -Monthly

As per the new conditions, the recipient will not be eligible to avail the ITC related to the following suppliers who are not GST complaints and the said ITC will be showing as ITC not available. Hence one needs to be very vigilant while dealing with those suppliers who are not meeting their GST compliance properly as it will be leading impact on the ITC of the recipient. Further it is a welcome step for the recipients to know their supplier to avoid future GST notices related to ITC mismatches.

Legal Extract:

Section 104: Substitution of New Section for 38

1. The details of outward supply declared by the supplier and the details of input tax credit shall be made available to the recipient through an auto-generated statement.

2. The statement shall include the details of ITC which is available and ITC which is not available.

The details of ITC in respect of such invoices which is not available where the supplier is;

1. A registered person within such period of taking registration as may be prescribed; or

2. Any registered person who has defaulted in payment of tax and where such default has continued for such period as may be prescribed; or

3. Any registered person the output tax payable by whom in accordance with the statement of outward supplies furnished by him under the said sub-section during such period, as may be prescribed, exceeds the output tax paid by him during the said period by such limit as may be prescribed; or

4. Any registered person who, during such period, as may be prescribed, has availed credit of input tax of an amount that exceeds the credit that can be availed by him in accordance with clause (a), by such limit as may be prescribed; or

5. Any registered person who has defaulted in discharging his tax liability through the electronic cash ledger, in accordance with the provisions of sub-section (12) of section 49; or

6. Such other class of persons as may be prescribed.

A thorough discussion is required on this topic, let us take an example;

For Example: Mr. Sachin Kumar is a registered person from Haryana. He took various inward supplies from different suppliers which are as follow

S. No.	Name of Supplier	ITC (Rs)	Remark
1.	Indigo Air Ltd.	28000	Air tickets fare (ITC available)
2.	New Mart Pvt Ltd.	19000	A registered person who has taken registration just 1 month before. (Suppose term prescribed in the rule is 1 month)
3.	Defaulter & Co.	5000	Person making default in payment of taxes
4.	Failure Pvt Ltd.	7500	Having difference in payment of output tax more than the prescribed limit.
5.	Cheater Traders	12000	Availed the ITC more than the amount of ITC which can be availed
6.	Scammer Pvt Ltd	1500	Person defaulted in discharging tax liability in accordance with Section 49(12)

Solution: ITC available to Mr. Sachin Kumar is

S. No.	Name of Supplier	ITC (Rs)	Available (Yes/No)	Available Amount	Non-Available Amount
1.	Indigo Air Ltd.	28000	Yes	28000	–
2.	New Mart Pvt Ltd.	19000	No	–	19000
3.	Defaulter & Co.	5000	No	–	5000
4.	Failure Pvt Ltd.	7500	No	–	7500
5.	Cheater Traders	12000	No	–	12000
6.	Scammer Pvt Ltd	1500	No	–	1500
TOTAL				28000	45000

2. Time limit to issue Credit Notes related to FY 22-23 has been increased from Sep 22 to Nov 22

Time limit to declare the details of credit note in return:

The time limit for declaring the details of credit note is 30th November of the year succeeding the year related to which credit note is issued or the date of furnishing of annual return, whichever is earlier.

Earlier, the time limit was to declare it in the return of September of the year succeeding the year in which it had been issued or the date of furnishing annual return, whichever is earlier.

Section 102: Amendment in Section 34of the CGST Act, 2017

Example: Mr. Sachin Gupta, a registered person, purchased some goods from Mr. Ajay Aggarwal for which the invoice was issued on 4th January, 2022. Mr. Sachin Gupta returned some goods to Mr. Ajay

We are taking different situation where credit note was raised by Mr. Ajay

1. Credit note issued on 31st March, 2022

2. Credit note issued on 5th November, 2022

3. Credit Note issued on 1st December, 2022

In the above situations, specify whether she can issue the credit notes on these dates? Also specify whether Mr. Ajay is eligible to adjust the above GST in the return.

Solution: Yes, Mr. Ajay can issue the credit note on all of the dates specified above but she would not be eligible to adjust the GST after 30th November, 2022.In situation no. 3, where the credit note is issued on 1st December, 2022, GST would not be adjusted.

3. Time limit of availing the ITC of FY 2022-23 has been increased from Sep-22 to Nov -22

Section 100: Amendment in Section 16 of the CGST Act, 2017

1. Clause (ba) has been inserted after clause (b) of section 16(2), where a condition for claiming ITC has been added that a registered person shall be eligible to claim ITC only if the said ITC is not restricted under Section 38.

2. As per Section 16(4), a registered person is not entitled to claim ITC after;

3. 30th November of the year succeeding the financial year for which he is claiming ITC, or

4. the date of filing of relevant annual return whichever is earlier.

Earlier it was required to claim by the due date of furnishing return u/s 39 for the month of September of the financial year following the financial year for which ITC is required to be claimed.

For Example: Mr. Prakash hadn’t claimed the ITC of Rs 15000 under IGST in the month of December, 2021. He can claim this ITC by 30th November, 2022 or the date of filing of annual return for FY 2021-22, whichever is earlier. Let’s take different situation where he files his return on different dates;

1. Return for the month of February 2022 on 15th March, 2022

2. Return for the month of July 2022 on 15th November, 2022

3. Return for the quarter of July-September 2022 (opted QRMP) on 30th November, 2022 with late fees

4. Return for the quarter of July-September 2022 (opted QRMP) on 5th December, 2022 with late fees.

5. Return for the month of October 2022 on 30th November, 2022

Solution:

1. Eligible to claim ITC (on or before 30th November, 2022)

2. Eligible to claim ITC (on or before 30th November, 2022)

3. Yes, eligible even it had been filed late as because the ITC is claimed on or before 30th November, 2022

4. No, the return has been filed after 30th November, 2022

5. Yes, eligible even it had been filed late as because the ITC is claimed on or before 30th November, 2022

Note: This is applicable from this year 2021-22.