Articles contains Analysis of Amendments In Central Goods & Services Tax Act, 2017  Vide CGST Amendment Act, 2018 And Amendments In Integrated Goods & Services Tax Act, 2017  Vide IGST (Amendment) Act, 2018.

AMENDMENTS IN CENTRAL GOODS & SERVICES TAX ACT, 2017
VIDE CGST AMENDMENT ACT, 2018 (Amendments, which have come in to force)

Section Existing Provisions Amended Provisions
2(4) “adjudicating authority” means any authority, appointed or authorised to pass any order or decision under this Act, but does not include the Central Board of Excise and Customs, the Revisional Authority, the Authority for Advance Ruling, the Appellate Authority for Advance Ruling, the Appellate Authority and the Appellate Tribunal; “adjudicating authority” means any authority, appointed or authorised to pass any order or decision under this Act, but does not include the Central Board of Indirect Taxes and Customs, the Revisional Authority, the Authority for Advance Ruling, the Appellate Authority for Advance Ruling, the Appellate Authority, the Appellate Tribunal and the Authority referred to in sub-section (2) of section 171;
(w.e.f. 01/02/2019)

Amending to the Central Board of Revenue Act, 1963, name of the existing “Central Board of Excise & Customs” (CBEC) has been renamed as “Central Board of Indirect Taxes and Customs” (CBIC) vide Finance Act 2018. Accordingly the changes in clause (4) of section 2 of the CGST Act, 2017 was inevitable.

National Anti-Profiteering Authority constituted under section 171(2) has been excluded from the definition of ‘adjudicating authority’.

2(17)(h) services provided by a race club by way of totalisator or a licence to book maker in such club ; and activities of a race club including by way of totalisator or a license to book maker or activities of a licensed book maker in such club; and
(w.e.f. 01/02/2019)

The amendment seems to be made to ensure that all activities related to a race club are included in definition of business. Further the activities of a licensed book maker in such club has been specifically brought in the definition of the business.  The word ‘services’ used earlier has caused a dispute because as per the Act, actionable claims are goods.

It is worth to note that as per newly inserted rule 31A of CGST Rules (dated 23/01/2018), the value of supply of actionable claim in the form of chance to win in betting, gambling or horse racing in a race club shall be 100% of the face value of the bet or the amount paid into the totalisator. TRU has explained vide circular no. 27/01/2018-GST dated 04/01/2018 that GST would be leviable on the entire bet value i.e. total of face value of any or all bets paid into the totalisator or placed with licensed book makers, as the case may be. Illustration: If entire bet value is Rs. 100, GST leviable will be Rs. 28/-

2(18)

“business vertical” means a distinguishable component of an enterprise that is engaged in the supply of individual goods or services or a group of related goods or services which is subject to risks and returns that are different from those of the other business verticals.

Explanation.––For the purposes of this clause, factors that should be considered in determining whether goods or services are related include–

(a)  the nature of the goods or services;

(b)  the nature of the production processes;

(c)  the type or class of customers for the goods or services;

(d)  the methods used to distribute the goods or supply of services; and

(e)  the nature of regulatory environment (wherever applicable), including banking, insurance, or public utilities;

Omitted
(w.e.f. 01/02/2019)
Due to amendment in section 25(2) and Rule 11, the term “business vertical” become irrelevant in this law.
2(35) “cost accountant” means a cost accountant as defined in clause (c) of sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959 (23 of 1959); “cost accountant” means a cost accountant as defined in clause (b) of sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959 (23 of 1959);
(w.e.f. 01/02/2019)
There was a typographical error in the earlier definition, which has been rectified. Clause (c) of section 2(1) of ICWA Act defines the ‘Council’, whereas clause (b) of the said section defines ‘cost accountant’.
2(69)(f) a Development Board constituted under article 371 of the Constitution; or a Development Board constituted under article 371 and article 371J of the Constitution; or
(w.e.f. 01/02/2019)

The term local authority will now also include Development board constituted under Article 371J of the Constitution.

Article 371J grants special status to 6 backward districts of Karnataka-Hyderabad region by empowering the President to establish a separate Board to ensure equitable distribution of funds in the State’s budget to meet the developmental needs of the region

2(102) …. Explanation.––For the removal of doubts, it is hereby clarified that the expression “services” includes facilitating or arranging transactions in securities;
(Inserted w.e.f. 01/02/2019)
Although ‘securities’ has been excluded from the definition of ‘goods’ and ‘services’, but the facilitating or arranging transactions in securities is included in the ambit of services and accordingly is liable for GST.
7(1)(b) import of services for a consideration whether or not in the course or furtherance of business; import of services for a consideration whether or not in the course or furtherance of business; and
(w.r.e.f. 01/07/2017)
The word “and” added to facilitate the omission of clause (d)
7(1)(c) the activities specified in Schedule I, made or agreed to be made without a consideration; and the activities specified in Schedule I, made or agreed to be made without a consideration;
(w.r.e.f. 01/07/2017)
The word “and” omitted to facilitate the omission of clause (d)
7(1)(d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II. Omitted (w.r.e.f. 01/07/2017)

This amendment seems to be effected  in order to remove the anomaly that in some cases, even though an activity mentioned in Schedule II did not amount to supply, due to deemed inclusion of such activities in definition of supply, it attracted tax. This defeated the objective of Schedule II, which was to give guidance on whether specified activities were to be treated as supply of goods or services.

Advance Rulings dated 26/03/2018 in case of “Caltech Polymers Private Ltd., Kerala”, the Authorities has declared the canteen services provided as per the provisions of factories Act ,1 948 as supply of services on the basis of the paragraph 6(b), without establishing the said activities as supply. The fate of the said ruling and similar other rulings after this retrospective amendment are in question now.

The amendment has put question marks on tax position taken on many transactions especially on the activities which have been considered as taxable under the entry “agreeing to obligation to refrain from an act or to tolerate an act or a situation or to do an act”. Reference may be made to the advance rulings in case of -Maharashtra State Power Generation Company Limited.

7(1A) …… where certain activities or transactions constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.
(Inserted w.r.e.f. 01/07/2017)
This amendment seems to be effected  in order to remove the anomaly that in some cases, even though an activity mentioned in Schedule II did not amount to supply, due to deemed inclusion of such activities in definition of supply, it attracted tax. This defeated the objective of Schedule II, which was to give guidance on whether specified activities were to be treated as supply of goods or services.
The existing provision under Section 7 which made activities under Schedule II as a supply of goods or services was an inadvertent error in law drafting. If it was corrected at this stage prospectively, there would be numerous litigations. Perhaps for the said reason, the amendment has been given a retrospective effect.
7(3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as—
(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.
Subject to the provisions of sub-sections (1), (1A) and (2), the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as—
(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.
(w.r.e.f. 01/07/2017)
Amended to give effect of insertion of sub-section (1A) on the residuary power.
9(4) The central tax in respect of the supply of taxable goods or services or both by a supplier, who is not registered, to a registered person shall be paid by such person on reverse charge basis as the recipient and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both. The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.
(w.e.f. 01/02/2019)
The obligation on the registered persons of paying tax on reverse charge basis against receipt of taxable supplies from unregistered person has been removed. Earlier the applicability of this provision was postponed w.e.f. 12/10/2017 till 30/09/2019.

The amended section however confers power to the Central Government to notify the class of persons who will be responsible for paying tax under this section on receipt of specified supplies from unregistered persons. It is expected that in near future class or classes of persons dealing in specific products may be specified for the purpose of section 9(4).

10(1) Notwithstanding anything to the contrary contained in this Act but subject to the provisions of sub-sections (3) and (4) of section 9, a registered person, whose aggregate turnover in the preceding financial year did not exceed fifty lakh rupees, may opt to pay, in lieu of the tax payable by him, an amount calculated at such rate as may be prescribed, but not exceeding,– Notwithstanding anything to the contrary contained in this Act but subject to the provisions of sub-sections (3) and (4) of section 9, a registered person, whose aggregate turnover in the preceding financial year did not exceed fifty lakh rupees, may opt to pay, in lieu of the tax payable by him under sub-section (1) of section 9, an amount calculated at such rate as may be prescribed, but not exceeding,–
(w.e.f. 01/02/2019)

This amendment specifies that the tax under composition scheme is now payable only in lieu of the tax payable u/s. 9(1). In other words tax on reverse charge basis, if payable, will not be as per this scheme and the scheme will not be applicable on tax payable by Electronic Commerce Operator u/s. 9(5).

Amendment of section 9(4) and 10(1) clears the path to make the persons under composition scheme to pay tax on RCM against procurement of taxable goods/ services from unregistered persons for re-supply. Ideally, the lower rate of tax under composition scheme is a lump-sum levy on the value additions by the supplier and such scheme does not change the rate of tax of goods or services.

10(1)
Proviso
Provided that the Government may, by notification, increase the said limit of fifty lakh rupees to such higher amount, not exceeding one crore rupees, as may be recommended by the Council. Provided that the Government may, by notification, increase the said limit of fifty lakh rupees to such higher amount, not exceeding one crore and fifty lakh rupees, as may be recommended by the Council.
(w.e.f. 01/02/2019)
The permissible limit of aggregate turnover has been enhanced and now the Government may notify the limit up to Rs. 150 Lakhs.
10(1) Second Proviso ….. Provided further that a person who opts to pay tax under clause (a) or clause (b) or clause (c) may supply services (other than those referred to in clause (b) of paragraph 6 of Schedule II), of value not exceeding ten per cent. of turnover in a State or Union territory in the preceding financial year or five lakh rupees, whichever is higher.
(w.e.f. 01/02/2019)
Earlier the composition scheme was only on the supply of goods and on the supply of deemed services of “supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration”. This amendment seems to allow composite scheme even if the persons supplies services/ other services within the permissible limit. It is also worth to mention that in the amendment relating to services, the cap of maximum value of services remains same for the persons having turnover (in the prev year) between Rs. 50 lakhs to Rs. 1.5 Crores.
10(2)(a) he is not engaged in the supply of services other than supplies referred to in clause (b) of paragraph 6 of Schedule II; save as provided in sub-section (1), he is not engaged in the supply of services;
(w.e.f. 01/02/2019)
This amendment also seems to made to allow the composite scheme even if the persons supplies services, other services within the permissible limit
12(2)(a) the date of issue of invoice by the supplier or the last date on which he is required, under sub-section (1) of section 31, to issue the invoice with respect to the supply; or the date of issue of invoice by the supplier or the last date on which he is required, under  section 31, to issue the invoice with respect to the supply; or
(w.e.f. 01/02/2019)
This amendment seeks to rectify a drafting error and accordingly includes issuance of invoice/other documents contained in other sub-sections of Section 31 like continuous supply of goods, sales of goods sent on approval etc.
13(2)(a) the date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under sub-section (2) of section 31 or the date of receipt of payment, whichever is earlier; or the date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under section 31 or the date of receipt of payment, whichever is earlier; or
(w.e.f. 01/02/2019)
This amendment seeks to rectify a drafting error and accordingly includes issuance of invoice/other documents contained in other sub-sections of Section 31 like continuous supply of services etc.
13(2)(b) the date of provision of service, if the invoice is not issued within the period prescribed under sub-section (2) of section 31 or the date of receipt of payment, whichever is earlier; or the date of provision of service, if the invoice is not issued within the period prescribed under section 31 or the date of receipt of payment, whichever is earlier; or
(w.e.f. 01/02/2019)
This amendment seeks to rectify a drafting error and accordingly includes non- issuance of invoices as per other sub-sections of Section 31.
16(2)(b)
Explan.
For the purposes of this clause, it shall be deemed that the registered person has received the goods where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; Explanation.—For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services––

(i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise;

(ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person.
(w.e.f. 01/02/2019)

Earlier the term ‘he has received’ used in section 16(2) has apparently given a restricted meaning and apparently the input tax credit is allowed if the goods or services have been received by the claimant himself. The amendment seeks to expand the meaning of the word “him” used in the sub-section. The wordings of the clause (a) of the explanation seems to be influenced by the wordings of section 10(1)(b) of IGST Act, 2017.
17(3)

Explanation

……. Explanation- For the purposes of this sub-section, the expression ‘‘value of exempt supply’’ shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said Schedule.
(w.e.f. 01/02/2019)
The explanation has been inserted to clarify that reversal of common ITC shall not be required on activities or transactions specified in Schedule III (other than sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building) by excluding those from the ambit of ‘exempt supply’ for the purpose of reversal.
There were some advance ruling including the aforesaid rulings in case of BASF  India Limited,  where it has been held the  goods sold on High Seas sale basis being non-taxable supply as per Section 2(78) of the CGST Act and being exempt supply as per Section 2(47) of the CGST Act, the input tax credit to the extent of inputs, input services and common input services would be required to be reversed by the applicant as per Section 17 of the CGST Act.
17(5)(a) motor vehicles and other conveyances except when they are used–
(i) for making the following taxable supplies, namely:—
(1) further supply of such vehicles or conveyances ; or
(2) transportation of passengers; or
(3)  imparting training on driving, flying, navigating such vehicles or conveyances;
(ii) for transportation of goods;
motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely:—
(A) further supply of such motor vehicles; or
(B) transportation of passengers; or
(C) imparting training on driving such motor vehicles;
(w.e.f. 01/02/2019)
The amendment brings clarity regarding blocked credit of input tax credit. Construction equipment vehicles are now entitled for ITC, irrespective of the fact that whether the same are used for transportation of goods or not. Similarly blockade on input tax credit on Motor buses also removed. Blockade on ITC in respect of ‘other conveyance’ has removed the blockade of ITC in respect of non- motorised vehicles.
17(5)(aa) ….. vessels and aircraft except when they are used––
(i) for making the following taxable supplies, namely:—
(A) further supply of such vessels or aircraft; or
(B) transportation of passengers; or
(C) imparting training on navigating such vessels; or
(D) imparting training on flying such aircraft;
(ii) for transportation of goods;
(w.e.f. 01/02/2019)

Separate provision is created for blocking ITC in respect of vessel and aircrafts.  Earlier these items were included in the term “other conveyances”.

17(5)(ab) …. services of general insurance, servicing, repair and maintenance in so far as they relate to motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa):
Provided that the input tax credit in respect of such services shall be available—
(i) where the motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) are used for the purposes specified therein;
(ii) where received by a taxable person engaged—
(I) in the manufacture of such motor vehicles, vessels or aircraft; or
(II) in the supply of general insurance services in respect of such motor vehicles, vessels or aircraft insured by him;
(w.e.f. 01/02/2019)

A separate provision has been inserted to specify the blockade of ITC shall be available in respect of services of general insurance, servicing, repair and maintenance in so far as they relate to motor vehicles, vessels and aircraft for which the credit is blocked. It has been further specified that ITC on services of general insurance, servicing, repair and maintenance on motor vehicles, vessels or aircraft is allowed to manufacturer of such motor vehicles, vessels or aircraft and to those engaged in supply of general insurance services in respect motor vehicles, vessels or aircraft insured by them.

Earlier, it was a debatable issue that whether ITC is blocked or not on the aforesaid services in connection with such vehicles and conveyances. The question was unresolved that “Whether the phrase “in respect of” will also include expenses related to such motor vehicle?”. Some of the experts were of view that the same would have wider impact and can covers all the goods and services that are relatable to motor vehicles, however, some were of the view that this phrase is very restricted and is limited to ITC on the purchase of motor vehicles.  This amendment has settled the issue for future, but issue of availability of ITC prior to 01/02/2019 is still debatable.

17(5)(b) the following supply of goods or services or both—
(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery except where an inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;(ii) membership of a club, health and fitness centre;(iii) rent-a-cab, life insurance and health insurance except where–(A) the Government notifies the services which are obligatory for an   employer to provide to its employees under any law for the time being in force; or(B) such inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply; and(iv) travel benefits extended to employees on vacation such as leave or home travel concession;

the following supply of goods or services or both—

(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance:

Provided that the input tax credit in respect of such goods or services or both shall be available where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;

(ii) membership of a club, health and fitness centre; and

(iii) travel benefits extended to employees on vacation such as leave or home travel concession:

Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.
(w.e.f. 01/02/2019)

Blockade of ITC in respect of “rent a cab” has been expanded to the blockade of ITC in respect of leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein.

Blockade of ITC in respect of aforesaid supplies has been specified to not applicable in cases where goods or services or both is obligatory for an employer to provide to its employees under any law for the time being in force.

20 Explanation – clause (c) the term ‘‘turnover’’, in relation to any registered person engaged in the supply of taxable goods as well as goods not taxable under this Act, means the value of turnover, reduced by the amount of any duty or tax levied under entry 84 of List I of the Seventh Schedule to the Constitution and entries 51 and 54 of List II of the said Schedule. the term ‘‘turnover’’, in relation to any registered person engaged in the supply of taxable goods as well as goods not taxable under this Act, means the value of turnover, reduced by the amount of any duty or tax levied under entries 84 and 92A of List I of the Seventh Schedule to the Constitution and entries 51 and 54 of List II of the said Schedule.
(w.e.f. 01/02/2019)

This amendment has excluded the amount of tax levied under entry no.  92A of List I from the value of turnover for the purposes of distribution of credit by ISD.

Entry 92A of List I (Union List) covers   “Taxes on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce”. In other words this amendment provides that

all type of other taxes i.e. Central Excise, State excise, VT, CST levied on the goods which are outside the scope of GST i.e. petrol, diesel, liquor etc. would not be included in the computation of turnover for the purpose of distribution of credit by ISD.

22(1) Second proviso ….

Provided further that the Government may, at the request of a special category State and on the recommendations of the Council, enhance the aggregate turnover referred to in the first proviso from ten lakh rupees to such amount, not exceeding twenty lakh rupees and subject to such conditions and limitations, as may be so notified.

(w.e.f. 01/02/2019)

Inserting explanation (iii), meaning of the Special category States has been made narrower and excluded most of the States from this category. The remaining states in special category were Manipur, Mizoram, Nagaland and Tripura. In case of these special category states, the Government has been specifically empowered to enhance the threshold limit of such States on request of such state (s) and on recommendation of the council.
22 Explanation (iii) the expression “special category States” shall mean the States as specified in sub-clause (g) of clause (4) of article 279A of the Constitution except the State of Jammu and Kashmir.

the expression “special category States” shall mean the States as specified in sub-clause (g) of clause (4) of article 279A of the Constitution except the State of Jammu and Kashmir and States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand.

(w.e.f. 01/02/2019)

The threshold limit of turnover for registration for 6 special category States, viz.,  Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand is increased from ten lakh rupees to twenty lakh rupees.

Total numbers of States have been specified in in sub-clause (g) of clause (4) of article 279A of the Constitution were 11. Prior to this amendment, out of those 11, threshold limit was Rs. 10 lakhs in 10 States. By this amendment, in the context of threshold limit for registration, special status of 6 more states have been removed.  In post amendment scenario only four States i.e., Manipur, Mizoram, Nagaland and Tripura only have a lower threshold limit of Rs. 10 Lakhs.  

24 (x)

every electronic commerce operator;

every electronic commerce operator who is required to collect tax at source under section 52;

(w.e.f. 01/02/2019)

Earlier every ECO was liable to be registered irrespective of the amount of its turnover. As per the amended provision, only those e-commerce operators who are required to collect tax at source under Section 52 would be required to be registered compulsorily.

It is prudent to mention that vide Notification No. 52/2018 Central Tax dated 13/09/2018, the Central Government has notified that every electronic commerce operator, not being an agent, shall collect an amount calculated at a rate of half per cent. of the net value of intra-State taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the said operator.

Thus it appears that the ECO which are not acting as agent and whose turnover is within the threshold limit are not liable to be registered.

25 (1) Second Proviso ………

Provided further that a person having a unit, as defined in the Special Economic Zones Act, 2005, in a Special Economic Zone or being a Special Economic Zone developer shall have to apply for a separate registration, as distinct from his place of business located outside the Special Economic Zone in the same State or Union territory.

(w.e.f. 01/02/2019)

Separate registration is now compulsory for a person having a unit in the SEZ or for a SEZ developer distinct from the registration of place of business located outside the Special Economic Zone in the same State or Union territory.
25(2) Proviso

Provided that a person having multiple business verticals in a State or Union Territory may be granted a separate registration for each business vertical, subject to such conditions as may be prescribed.

Provided that a person having multiple places of business in a State or Union territory may be granted a separate registration for each such place of business, subject to such conditions as may be prescribed.

(w.e.f. 01/02/2019)

Earlier separate registration for different unit of business were permissible subject to the condition that such units were different business vertical. The said condition has been dispensed with and persons having multiple places of business in a State or Union territory have been allowed to opt and obtain separate registrations for each such place of business.
29 (marginal heading)

Cancellation of registration.

Cancellation or suspension of registration.

(w.e.f. 01/02/2019)

Scope of section 29 was earlier limited to cancellation of registrations in given circumstances. The marginal heading of the section has been amended in tune of the newly inserted provisos to sub-section (1) and sub-section (2), which provide for suspension of registration during pendency of proceedings relating to cancellation of registration.
29(1) Proviso

Provided that during pendency of the proceedings relating to cancellation of registration filed by the registered person, the registration may be suspended for such period and in such manner as may be prescribed.

(w.e.f. 01/02/2019)

The proviso has been inserted in order to provide the power and scope to suspend a registration till the finalisation of the decision.
29(2) Second Proviso

Provided further that during pendency of the proceedings relating to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.

(w.e.f. 01/02/2019)

The second proviso has been inserted in order to provide the power and scope to suspend a registration till the finalisation of the decision.
34(1)

Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as may be prescribed.

Where one or more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient one or more credit notes for supplies made in a financial year containing such particulars as may be prescribed.

(w.e.f. 01/02/2019)

The amendment now permits a registered person to issue consolidated credit note(s) as prescribed under Section 34 of the CGST Act in respect of multiple invoices issued in a Financial Year. Scope of prescribing invoice wise details in the credit note is still there.
34(3)

Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a debit note containing such particulars as may be prescribed.

Where one or more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient one or more debit notes for supplies made in a financial year containing such particulars as may be prescribed.

(w.e.f. 01/02/2019)

The amendment now permits a registered person to issue consolidated debit note (s) as prescribed under Section 34 of the CGST Act in respect of multiple invoices issued in a Financial Year. Scope of prescribing invoice wise details in the debit note is still there.
35(5) Proviso

Provided that nothing contained in this sub-section shall apply to any department of the Central Government or a State Government or a local authority, whose books of account are subject to audit by the Comptroller and Auditor-General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.

(w.e.f. 01/02/2019)

Provisions relating to audit as per section 35(5) [read with section 44(2) will now be not applicable in case of any department of the Central or State Government/local authority which is subject to audit by CAG. Such departments are not required to get any audit u/s, 35(5).

48(2) A registered person may authorise an approved goods and services tax practitioner to furnish the details of outward supplies under section 37, the details of inward supplies under section 38 and the return under section 39 or section 44 or section 45 in such manner as may be prescribed.

A registered person may authorise an approved goods and services tax practitioner to furnish the details of outward supplies under section 37, the details of inward supplies under section 38 and the return under section 39 or section 44 or section 45 and to perform such other functions in such manner as may be prescribed.

(w.e.f. 01/02/2019)

Scope of the work of GST practitioner, which was earlier confined to filing of returns has now been expanded and the Government may prescribe some other functions also, which can be performed by GSTP on behalf of the taxable persons.

49(5)(c) Proviso

Provided that the input tax credit on account of State tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax;

(w.e.f. 01/02/2019)

The amendment provides that while discharging liability under IGST Act, ITC on account of CGST will be fully utilised prior to the utilisation of ITC on account of SGST. In other words, the credit of SGST can be utilized for payment of IGST only when the balance of the input tax credit on account of CGST is not available for payment of IGST.

49(5)(d) Proviso

Provided that the input tax credit on account of Union territory tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax;

(w.e.f. 01/02/2019)

The amendment provides that while discharging liability under IGST Act, ITC on account of CGST will be fully utilised prior to the utilisation of ITC on account of UTGST. In other words, the credit of UTGST can be utilized for payment of IGST only when the balance of the input tax credit on account of CGST is not available for payment of IGST.

49A

49A. Utilisation of input tax credit subject to certain conditions.

Notwithstanding anything contained in section 49, the input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment.

(w.e.f. 01/02/2019)

The inserted section provides that credit on account of CGST, SGST/UTGST can be utilised only after exhausting the credit on account of IGST.

Therefore, the manner and priority of utilisation of GST credits is as follows:

a) Credit of IGST shall be utilised first against the liability of IGST, then against the liability of CGST & then against the liability of SGST.

b) Credit of CGST to be utilised for liability of: CGST/ IGST.

c) Credit of SGST to be utilised for liability of: SGST/ IGST.

This may result in input tax credit accumulation and accordingly may affect the cash position of the taxable persons.

49B

49B. Utilisation of input tax credit.

Notwithstanding anything contained in this Chapter and subject to the provisions of clause (e) and clause (f) of sub-section (5) of section 49, the Government may, on the recommendations of the Council, prescribe the order and manner of utilisation of the input tax credit on account of integrated tax, central tax, State tax or Union territory tax, as the case may be, towards payment of any such tax.

(w.e.f. 01/02/2019)

This Section confers special power on the Government to prescribe any specific order of utilization of ITC for payment of taxes, which may even supersede the existing sections of chapter-10.

52(9)

Where the details of outward supplies furnished by the operator under sub-section (4) do not match with the corresponding details furnished by the supplier under section 37, the discrepancy shall be communicated to both persons in such manner and within such time as may be prescribed.

Where the details of outward supplies furnished by the operator under sub-section (4) do not match with the corresponding details furnished by the supplier under section 37 or section 39, the discrepancy shall be communicated to both persons in such manner and within such time as may be prescribed.

(w.e.f. 01/02/2019)

The words and figure “or section 39” have been inserted to include reference of returns filed by the supplier. Now the details of outward supply u/s. 52 (TCS) may be matched with the details of outward supplies provided by the original supplier in GSTR-1 and also with returns filed under section 39.

54(8)(a) refund of tax paid on zero-rated supplies of goods or services or both or on inputs or input services used in making such zero-rated supplies;

refund of tax paid on export of goods or services or both or on inputs or input services used in making such exports;

(w.e.f. 01/02/2019)

This amendment relating to refund provides that the principle of unjust enrichment will apply in case of a refund claim arising out of supplies of goods or services or both made to a SEZ developer or unit.

54 Explanation Clause (2)(c)(i)

in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of––

(i) receipt of payment in convertible foreign exchange, where the supply of services had been completed prior to the receipt of such payment; or

(ii) issue of invoice, where payment for the services had been received in advance prior to the date of issue of the invoice;

in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of––

(i) receipt of payment in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India, where the supply of services had been completed prior to the receipt of such payment; or

(ii) issue of invoice, where payment for the services had been received in advance prior to the date of issue of the invoice;

(w.e.f. 01/02/2019)

Receipt of payment in Indian rupees, where permitted, by the RBI in case of export of services is also included in the explanation and thus the condition of receiving the payment only in convertible foreign exchange has been dispensed with.

Similar amendment has also been made in sub-clause (iv) clause (6) of Section 2  of the IGST Act to provide that services shall qualify as exports even if the payment for the services supplied is received in Indian rupees as per RBI regulations.

54 Explanation Clause (2)(e)

in the case of refund of unutilised input tax credit under sub-section (3), the end of the financial year in which such claim for refund arises;

in the case of refund of unutilised input tax credit under clause (ii) of the first proviso to sub-section (3), the due date for furnishing of return under section 39 for the period in which such claim for refund arises;

(w.e.f. 01/02/2019)

It has now been explained that the relevant date in the case of refund of unutilised ITC arising out of inverted duty structure, shall be the due date for furnishing of return under section 39 for the period in which such claim for refund arises.

79 Explanation

Explanation.––For the purposes of this section, the word person shall include “distinct persons” as referred to in sub-section (4) or, as the case may be, sub-section (5) of section 25.

(w.e.f. 01/02/2019)

The newly inserted explanation to the section relating to recovery of taxes  provides that recovery may be made from distinct persons present in any State(s) / UT(s) in order to ensure recovery from other establishments of the registered person. This section entrust the proper officers with arbitrary power and for the sake of justice some restrictions and conditions are expected on such power.

107(6)(b)

(6) No appeal shall be filed under sub-section (1), unless the appellant has paid—

(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and

(b) a sum equal to ten per cent. of the remaining amount of tax in dispute arising from the said order, in relation to which the appeal has been filed.

(6) No appeal shall be filed under sub-section (1), unless the appellant has paid—

(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and

(b) a sum equal to ten per cent. of the remaining amount of tax in dispute arising from the said order, subject to a maximum of twenty-five crore rupees,  in relation to which the appeal has been filed.

The amendment provides an upper limit of Rs. 25 Crores as pre-deposit against disputed tax in case of filing of the appeal to Appellate Authority.
112(8)(b)

a sum equal to twenty per cent. of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of section 107, arising from the said order, in relation to which the appeal has been filed.

a sum equal to twenty per cent. of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of section 107, arising from the said order, subject to a maximum of fifty crore rupees, in relation to which the appeal has been filed.

(w.e.f. 01/02/2019)

The amendment provides an upper limit of Rs. 50 Crores as pre-deposit against disputed tax in case of filing of the appeal to Appellate Tribunal.
129(6)

Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130:

Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within fourteen days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130:

(w.e.f. 01/02/2019)

The time limit has been extended from seven days to fourteen days.
140 (1)

A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law in such manner as may be prescribed:

A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit of eligible duties carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law in such manner as may be prescribed:

(w.e.f. 01/07/2017)

This clarifies that only transitional credit of eligible duties can be carried forward in the return and not all credits. Attempt has been made to give a retrospective effect to suchz amendment.
140 Explan-1(iv)

the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 ( 40 of 1978);

(w.e.f. 01/07/2017)

This specifically excludes the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 ( 40 of 1978) out of the ambit of eligible duties. Attempt has been made to give a retrospective effect to such amendment.
140 Explan-2(iv)

the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978);

(w.e.f. 01/07/2017)

This specifically excludes the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 ( 40 of 1978) out of the ambit of eligible duties and taxes. Attempt has been made to give a retrospective effect to such amendment.
140 Explan-3 …..

For removal of doubts, it is hereby clarified that the expression “eligible duties and taxes” excludes any cess which has not been specified in Explanation 1 or Explanation 2 and any cess which is collected as additional duty of customs under sub-section (1) of section 3 of the Customs Tariff Act, 1975. (51 of 1975).

(w.e.f. 01/07/2017)

The explanation is inserted w.r.e.f. 01/07/2017 to clarify that the expression “eligible duties and taxes” excludes any cess which has not been specified in Explanation 1 or Explanation 2 above and any cess which is collected as additional duty of customs under sub-section (1) of section 3 of the Customs Tariff Act, 1975.

143(1)(b) Second Proviso ….

Provided further that the period of one year and three years may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding one year and two years respectively.

(w.e.f. 01/02/2019)

As per Section 143, a registered person is allowed to send inputs or capital goods to a job worker for job work without payment of tax subject to the condition that the inputs and capital goods are brought back within permissible time limit of one year and three years respectively.

Vide the amendment Act, a proviso is inserted in Section 143 to provide that the prescribed periods may, on sufficient cause being shown, be extended by the Commissioner for a  limited period.

Schedule-I Para-4

Import of services by a taxable person from a related person or from any of his other establishments outside India, in the course or furtherance of business.

Import of services by a person from a related person or from any of his other establishments outside India, in the course or furtherance of business.

(w.e.f. 01/02/2019)

Import of services by unregistered person in furtherance of business are made liable to tax when received from a related person or from any of their establishments outside India.

Schedule-II Heading

ACTIVITIES TO BE TREATED AS SUPPLY OF GOODS OR SUPPLY OF SERVICES

ACTIVITIES OR TRANSACTIONS TO BE TREATED AS SUPPLY OF GOODS OR SUPPLY OF SERVICES

(w.e.f. 01/07/2017)

Perhaps it was a typographical error, which has been rectified vide this amendment with retrospective effect.
Schedule-III Para-7

Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India.

(w.e.f. 01/02/2019)

The paragraph has been inserted to expand the scope of transactions which are neither supply of goods and nor supply of services.
Schedule-III Para-8

(a) Supply of warehoused goods to any person before clearance for home consumption;

(b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption.

(w.e.f. 01/02/2019)

The paragraph has been inserted to expand the scope of transactions which are neither supply of goods and nor supply of services. It excludes the transactions involving movement of goods from one non-taxable territory to another non-taxable territory from the net of GST. This is to be noted that the above amendment is connected with supply of goods only and not with supply of services.

Circular no. 33/2017 – Cus. dated 1st August, 2017 and  Circular no. 3/1/2018-IGST dated 25th May, 2018 may be referred to. Advance ruling in the case of M/s. BASF India Limited, Maharashtra, dated 21/05/2018 may also be referred to.

Though in absence of any specific indication of retrosepective effect it seems to be operative with prospective effect only, but in view of the circulars issued in the past where it has been held that such transactions are not exigible to GST, a view could be that the insertion in the entry is also retrospective.

Explanation Explanation Explanation 1

(w.e.f. 01/02/2019)

Explanation 2

For the purposes of paragraph 8, the expression “warehoused goods” shall have the same meaning as assigned to it in the Customs Act, 1962.

(w.e.f. 01/02/2019)

The term “warehoused goods” in the newly inserted paragraph-8 has been defined.

AMENDMENTS IN CENTRAL GOODS & SERVICES TAX ACT, 2017  VIDE CGST AMENDMENT ACT, 2018 (Amendments, which have not come in to force)

Section Existing Provisions Amended Provisions
16(2)(c) subject to the provisions of section 41, the tax charged in respect of  such supply has been actually paid to the Government, either in cash or through utilisation of    input tax credit admissible in respect of the said supply; and subject to the provisions of section 41 or 43A, the tax charged in respect of  such supply has been actually paid to the Government, either in cash or through utilisation of    input tax credit admissible in respect of the said supply; and

This amendment is made to include the provisions relating to the new return format and system as specified in the newly inserted Section 43A, for availment of ITC.

39(1) Every registered person, other than an Input Service Distributor or a non- resident taxable person or a person paying tax under the provisions of section 10 or section 51 or section 52 shall, for every calendar month or part thereof, furnish, in such form and manner as may be prescribed, a return, electronically, of inward and outward supplies of goods or services or both, input tax credit availed, tax payable, tax paid and such other particulars as may be prescribed, on or before the twentieth day of the month succeeding such calendar month or part thereof. Every registered person, other than an Input Service Distributor or a non- resident taxable person or a person paying tax under the provisions of section 10 or section 51 or section 52 shall, for every calendar month or part thereof, furnish, in such form, manner and within such time as may be prescribed, a return, electronically, of inward and outward supplies of goods or services or both, input tax credit availed, tax payable, tax paid and such other particulars as may be prescribed

The time limit for filing the return has been omitted from the section and the power to prescribe the time of furnishing such returns has been provided to the Government. Omission of time limit in the section has also paved the way for inserting the proviso containing provisions of quarterly returns.

39(1) Proviso Provided that the Government may, on the recommendations of the Council, notify certain classes of registered persons who shall furnish return for every quarter or part thereof, subject to such conditions and safeguards as may be specified therein.

Newly inserted proviso has brought in the possibility of quarterly returns and has empowered the Government to notify certain classes of registered persons, who shall furnish quarterly returns.

It seems prudent to mention that the amendment relating to quarterly returns u/s. 39 will come in force with prospective effect only.  No power has been provided u/s. 39 with retrospective effect to prescribe any quarterly return.

39(7) Proviso Provided that the Government may, on the recommendations of the Council, notify certain classes of registered persons who shall pay to the Government the tax due or part thereof as per the return on or before the last date on which he is required to furnish such return, subject to such conditions and safeguards as may be specified therein.

The proviso seems to have been inserted in order to provide for prescribing the procedure for monthly payment of taxes even for quarterly filing of returns.

39(9)

Subject to the provisions of sections 37 and 38, if any registered person after furnishing a return under sub-section (1) or sub-section (2) or sub-section (3) or sub-section (4) or sub-section (5) discovers any omission or incorrect particulars therein, other than as a result of scrutiny, audit, inspection or enforcement activity by the tax authorities, he shall rectify such omission or incorrect particulars in the return to be furnished for the month or quarter during which such omission or incorrect particulars are noticed, subject to payment of interest under this Act:

Subject to the provisions of sections 37 and 38, if any registered person after furnishing a return under sub-section (1) or sub-section (2) or sub-section (3) or sub-section (4) or sub-section (5) discovers any omission or incorrect particulars therein, other than as a result of scrutiny, audit, inspection or enforcement activity by the tax authorities, he shall rectify such omission or incorrect particulars in such form and manner as may be perscribed, subject to payment of interest under this Act:

Straight jacket law of rectifying the errors in returns in the period in which such errors are noticed has been dispensed with and the Rule making authority has been empowered to prescribe the form and manner for such rectifications.

39(9) Proviso

Provided that no such rectification of any omission or incorrect particulars shall be allowed after the due date for furnishing of return for the month of September or second quarter following the end of the financial year, or the actual date of furnishing of relevant annual return, whichever is earlier.

Provided that no such rectification of any omission or incorrect particulars shall be allowed after the due date for furnishing of return for the month of September or second quarter following the end of the financial year to which such details pertain, or the actual date of furnishing of relevant annual return, whichever is earlier.
An unintentional lapse in the proviso has been rectified.
49(2)

The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41, to be maintained in such manner as may be prescribed.

The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41 or section 43A, to be maintained in such manner as may be prescribed.

Amendment to give effect of section 43A.
43A 43A.   Procedure for furnishing return and availing input tax credit.

Notwithstanding anything contained in sub-section (2) of section 16, section 37 or section 38, every registered person shall in the returns furnished under sub-section (1) of section 39 verify, validate, modify or delete the details of supplies furnished by the suppliers.

Notwithstanding anything contained in section 41, section 42 or section 43, the procedure for availing of input tax credit by the recipient and verification thereof shall be such as may be prescribed.

The procedure for furnishing the details of outward supplies by the supplier on the common portal, for the purposes of availing input tax credit by the recipient shall be such as may be prescribed.

The procedure for availing input tax credit in respect of outward supplies not furnished under sub-section (3) shall be such as may be prescribed and such procedure may include the maximum amount of the input tax credit which can be so availed, not exceeding twenty per cent. of the input tax credit available, on the basis of details furnished by the suppliers under the said sub-section.

The amount of tax specified in the outward supplies for which the details have been furnished by the supplier under sub-section (3) shall be deemed to be the tax payable by him under the provisions of the Act.

The supplier and the recipient of a supply shall be jointly and severally liable to pay tax or to pay the input tax credit availed, as the case may be, in relation to outward supplies for which the details have been furnished under sub-section (3) or sub-section (4) but return thereof has not been furnished.

For the purposes of sub-section (6), the recovery shall be made in such manner as may be prescribed and such procedure may provide for non-recovery of an amount of tax or input tax credit wrongly availed not exceeding one thousand rupees.

The procedure, safeguards and threshold of the tax amount in relation to outward supplies, the details of which can be furnished under sub-section (3) by a registered person,—

within six months of taking registration; who has defaulted in payment of tax and where such default has continued for more than two months from the due date of payment of such defaulted amount, shall be such as may be prescribed.

This newly inserted section 43A provides for prescribing the procedure for furnishing of returns and availing of ITC. As per this section, the tax on details of outward supplies declared by the supplier will be deemed to be payable by the supplier.

However, the supplier and recipient have been made jointly and severally liable to pay tax for details furnished/ not furnished by the supplier in respect of which the return has not been furnished.

140 Explan. (1)

Explanation 1.—For the purposes of sub-sections (3), (4) and (6), the expression “eligible duties” means––

Explanation 1.—For the purposes of sub-sections (1), (3), (4) and (6), the expression “eligible duties” means––

(w.e.f. 01/07/2017)

140 Explan. (2)

Explanation 2.—For the purposes of sub-section (5), the expression “eligible duties and taxes” means––

Explanation 2.—For the purposes of sub-sections (1) and (5), the expression “eligible duties and taxes” means––

(w.e.f. 01/07/2017)

AMENDMENTS IN INTEGRATED GOODS & SERVICES TAX ACT, 2017 AS AMENDED VIDE IGST (AMENDMENT) ACT, 2018 (Amendments, which have come in to force)

Section Existing Provisions Amended Provisions
2(6)(iv)

the payment for such service has been received by the supplier of service in convertible foreign exchange; and

the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and
Receipt of payment in Indian rupees, where permitted, by the RBI in case of export of services is also included in the explanation and thus the condition of receiving the payment only in convertible foreign exchange has been dispensed with.
2(16) Explan. (ii)

established by any Government, with ninety per cent. or more participation by way of equity or control, to carry out any function entrusted to a municipality under article 243W of the Constitution;

established by any Government, with ninety per cent. or more participation by way of equity or control, to carry out any function entrusted to a Panchayat under article 243G or to a municipality under article 243W of the Constitution;
Meaning of the term “Non taxable online recipient” and “Governmental authority” have been expanded.
5 The integrated tax in respect of the supply of taxable goods or services or both by a supplier, who is not registered, to a registered person shall be paid by such person on reverse charge basis as the recipient and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both. The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.

The obligation on the registered persons of paying tax on reverse charge basis against receipt of taxable supplies from unregistered person has been removed. Earlier the applicability of this provision was postponed w.e.f. 12/10/2017 till 30/09/2019.

The amended section however confers power to the Government to notify the class of persons who will be responsible for paying tax under this section on receipt of specified supplies from unregistered persons.

Similar changes has also been made in section 9(4) of the CGST Act.

8(2) Explan. 1 (iii)

an establishment in a State or Union territory and any other establishment being a business vertical registered within that State or Union territory,

an establishment in a State or Union territory and any other establishment registered within that State or Union territory,

For being a distinct person in the same State or UT, the earlier requirement of “being a business vertical” has been dispensed with for all the purpose including for the purpose of section 8(2).
12(8) Proviso .. Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods.

As per the newly inserted proviso, in case of transportation of goods from India to other country, the place of destination of such goods will be the place of supply of transportation service.  Thus transportation of goods from India to other country

by a transporter located in India will be termed as export of services and accordingly GST will not be levied on such services.

13(3)(a) Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs and are exported after repairs without being put to any other use in India, than that which is required for such repairs; Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs or for any other treatment or process and are exported after such repairs or treatment or process without being put to any use in India, other than that which is required for such repairs or treatment or process;

Earlier the services in respect of goods temporarily imported into India for repairs were treated as export of services as because the places of supply in such cases were the location of the recipient of services. By this amendment, the scope of the proviso has been expanded and similar provision will be applicable on services in respect to goods which are temporarily imported in India for job work i.e., any other treatment or processing.

17(2A)

The amount not apportioned under sub-section (1) and sub-section (2) may, for the time being, on the recommendations of the Council, be apportioned at the rate of fifty per cent. to the Central Government and fifty per cent. to the State Governments or the Union territories, as the case may be, on ad hoc basis and shall be adjusted against the amount apportioned under the said sub-sections.

This newly inserted sub-section provides that the amount of IGST which does not get apportioned under clauses (a) to (f) for the time being shall be apportioned to the Central Government and State Governments/Union Territories @ 50% each on the recommendations of the Council and shall be adjusted against the amounts apportioned under clauses (a) to (f).

20 Fifth Proviso Provided also that where the appeal is to be filed before the Appellate Authority or the Appellate Tribunal, the maximum amount payable shall be fifty crore rupees and one hundred crore rupees respectively.
Like the amendments in section 107(6)(b) and section 1112(8)(b) of the CGST Act, the upper limit of pre-deposit of a part of disputed tax in case of filing of Appellate Authority  or Appellate Tribunal.

Author Bio

More Under Goods and Services Tax

One Comment

Leave a Comment

Your email address will not be published. Required fields are marked *