Introduction: The 53rd GST Council Meeting held on 22-06-2024 in Delhi unveiled significant recommendations aimed at refining GST regulations. From waivers on penalties to amendments in tax rates and procedural enhancements, these decisions promise to streamline operations and reduce complexities for taxpayers across India. Key recommendations relating to changes in tax rates, measures for facilitation of trade and clarifications on key issues under GST are as follows:
| SI. No. | Key Recommendations |
| 1 | Waiver of interest and penalties for demand notices issued u/s 73 for FY 2017-18 to 2019-2020 for cases not involving fraud, suppression and misstatement. It is applicable to cases where the taxpayer pays the full amount of tax in the notice by 31 March 2025. |
| 2 | The time limit to avail ITC for invoices or debit notes u/s 16(4) in any GSTR-3B filed up to 30 November 2021 for FY 2017-18 to 2020-2021 may be deemed to be 30 November 2021 to apply retrospectively. |
| 3 | Interest u/s 50 is not applicable in case the amount available in the electronic cash ledger on the due date of filing GSTR-3B and is debited while filing the said return later. |
| 4 | Insertion of a functionality by a way of form GSTR-1A for taxpayers to amend / add particulars of GSTR-1 that is missed out for current tax period before filing GSTR-3B. |
| 5 | Reduction in rate of TCS to be collected by the ECO’s for supplies being made through ECO from 1% to 0.5%. |
| 6 | Value of service can be considered as “Nil” where foreign affiliate provides certain services to the domestic entity for which the recipient is entitled to claim full ITC. |
| 7 | Time limit for claim of ITC under section 16(4) for tax paid under RCM is the financial year in which invoice is issued. |
| 8 | Service by way of hostel accommodation for students and working professionals for a limit up to Rs. 20,000 per person per month provided service is rendered for a continuous period of 90 days. |
| 9 | Monetary limits for filing appeals by the department may be Rs.20 lakh for GST Appellate Tribunal, Rs.1 crore for High Court and Rs.2 crore for Supreme Court. |
| 10 | The maximum amount for pre-deposit for filing appeal before appellate authorities shall be reduced from Rs.25 crore under CGST and Rs.25 crore under SGST to Rs.20 crore respectively. |
| 11 | The pre-deposit for filing of appeal before the Appellate Tribunal will be reduced from 20% with a maximum amount of Rs.50 crores CGST and Rs.50 crores SGST to 10% with a maximum amount of Rs.20 crores CGST and Rs.20 crore SGST. |
| 12 | Clarification on following key issues to provide clarity to reduce the litigation:
a) Taxability of reimbursement of securities / shares as ESOP / ESPP / RSU provided by company to its employees b) Taxability of loans granted between related person or between group entities c) Place of supply for goods supplied to unregistered persons, where delivery address is different from billing address d) Mechanism for providing evidence in respect of post-sale discounts to the effect that input tax credit has been reversed by the recipient of the said amount e) Warranty and extended warranty provided by manufacturer to the end customers f) Clarification on valuation of corporate guarantee provided between related persons after insertion of Rule 28(2). |
It may be noted that some of the measures / amendments announced by the council are welcome steps which would benefit the trade immensely. The same would be given effect through the relevant circulars / notifications / law amendments which shall have the force of law.
Author Bio
