India’s tryst with its most comprehensive indirect tax reform, the goods and services tax (GST), began on July 01, 2017 and has completed 46 days on this 71st Independence Day. This signifies the freedom of taxpayers from 17 different indirect taxes mainly being Central Excise, Service Tax & VAT. GST has become the most talked about and discussed topic among trade, industry, professionals, officers & even housewives. Social media and internet is flooded with information & knowledge sharing related to GST. Unfortunately, many times information is not based on legal understanding of the subject leading to confusion and rumours.
GST seeks to bundle state and central levies into one and create a seamless national market throughout the country. The successful implementation of GST is largely dependent on common portal by GST Network (GSTN). The monthly filing of GST Returns is the most vital part of the entire compliance system. Most taxpayers are now aware that the GST law has prescribed three monthly returns to be filed by registered persons (except few like composition taxable person, ISD, non resident taxable person, etc).
2. Due Date for filing GST Returns
A normal taxpayer is required to file GSTR 1, 2, & 3 returns for every month. The normal due dates for filing the same is 10th, 15th & 20th of the subsequent month respectively. But the time limit for filing returns for the months of July & August, 2017 has been relaxed until September. Actually, the extension is mainly because the GST Network itself is not fully prepared and ready to take the complete load within due dates!
The Ministry of Finance issued a press release on 18/06/2017 announcing relaxation as below:
“Relaxation in return filing procedure for first two months of GST implementation: With the objective of ensuring smooth rollout of GST and taking into account the concerns expressed by the trade and industry regarding filing of the returns in GST regime, it has been decided that, for the first two months of GST implementation, the tax would be payable based on a simple return (Form GSTR-3B) containing summary of outward and inward supplies which will be submitted before 20th of the succeeding month. However, the invoice-wise details in regular GSTR – 1 would have to be filed for the month of July and August, 2017 as per the timelines given below:-…”
To provide legal sanctity to the above press release, the Government of India issued three notifications i.e. 18/2017-CT, 19/2017-CT and 20/2017-CT all dated 8th August, 2017 relaxing filing dates for GSTR – 1, 2 & 3 respectively. The due dates as revised by the said notifications for filing various GST returns is summarised below in tabular form for easy understanding:
|Timeline for filing GST Returns:|
|Month||Form GSTR – 3B |
|Outward Supplies in |
|Inward Supplies in |
|Payment Details & Setoff in GSTR-3|
|July, 2017||20-08-2017||1st – 5th Sep, 17||6th – 10th Sep, 17||11th – 15th Sep, 17|
|August, 2017||20-09-2017||16th – 20th Sep, 17||21st – 25th Sep, 17||26th – 30th Sep, 17|
|September, 2017 |
|NA||1st – 10th Oct, 17||11th – 15th Oct, 17||16th – 20th Oct, 17|
| 1) Outward Supply (Eg. Sales) both inter-state & intra-state shall be entered in Point 3.1(a) [Report both Taxable Value & Tax Break-up.] |
2) Similarly, for Inward Supply liable under Reverse Charge (like GTA, URD purchase, etc) report both Taxable Value & Tax Break-up at Point 3.1(b)
3) Input Tax Credit (ITC) on all Inward Supply (Eg. Purchases & Expenses) from Registered Person shall be reflected in Point 4A(5): Eligible ITC (All other ITC) [Report only Tax Break -Up without Taxable Value]
4) Information is Point 3.2 is primarily for tranfer of SGST portion in IGST to the consuming state
5) Though GSTR – 3B is in lieu of GSTR-3, still filing of GSTR – 3 is compulsory
6) Composition Taxable Persons are not required to file GSTR – 3B (Summary Return)
7) If a registered person is having transitional credit, he is allowed to file GSTR-3B upto 28/08/17
8) Even in case there is nothing to report, filing NIL Return is mandatory
3. Due Date for Payment of GST
The social media is flooded with information declaring that the due date for payment of GST is the 20th of the subsequent month. In normal case, this is absolutely correct. But when the due date of filing GSTR-3 is extended, the last date of payment of tax gets automatically extended till the date allowed for filing such return. In simple words, GSTsathi is of the view that when the last date for filing GSTR-3 for the month of July, 17 is extended upto 15th September, 2017 then the last date for payment of #GST for July also automatically gets extended upto 15-09-2017.
Surprisingly, the official twitter handle of Government of India @askGST today i.e. on 17-07-2017 tweeted that the last date for payment of GST for the month of July is 20/08/2017. The said tweet & reply by GSTsathi can be read at Click Here
Shockingly, the same info was soon reiterated by Ministry of Finance Click Here which made it necessary to finally write this article without further delay.
4. Due Date for Payment of GST: Legal Analysis
Section 39 of the CGST Act, 2017 deals with filing of GSTR-3 Return and relevant portion is extracted below:
“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.
(6) The Commissioner may, for reasons to be recorded in writing, by notification, extend the time limit for furnishing the returns under this section for such class of registered persons as may be specified therein:
Provided that any extension of time limit notified by the Commissioner of State tax or Union territory tax shall be deemed to be notified by the Commissioner.
(7) Every registered person, who is required to furnish a return under sub-section (1) or sub-section (2) or sub-section (3) or sub-section (5), shall pay to the Government the tax due as per such return not later than the last date on which he is required to furnish such return.”
Undoubtedly, Section 39(1) has specified 20th of the succeeding month as the last date for filing of return under the said sub-section. Rule 61(1) of the CGST Rules, 2017 has prescribed FORM GSTR-3 as return to be filed electronically through the common portal u/s 39(1).
As mentioned earlier, the Government of India issued Notification No. 20/2017-Central Tax dated 08-08-2017 using powers u/s 39(6) to extend the time limit for furnishing the return u/s 39(1) for the month of July & August 2017 to 15th and 20th September, 2017 respectively. Meaning thereby that the first monthly return u/s 39(1) i.e. GSTR-3 for July 17 is required to be filed by every normal taxpayers by 15-09-2017.
Now, Section 39(7) as reproduced above is very clear and unambiguous that the tax due as per GSTR-3 Return shall be paid to the Government on or before the last date on which such return is required to be furnished. The provision nowhere mentions that the last date of payment is 20th of the next month but has rightly linked the payment date with the return filing date. The word ‘such’ return refers to GSTR-3 Return.
It is pertinent to mention that there is no enabling statutory provision in the CGST Act which provide for filing of any return like GSTR-3B. The same has been introduced as interim returns through delegated legislation vide Rule 61(5) which is reproduced below for reference.
Rule 61(5) “Where the time limit for furnishing of details in FORM GSTR-1 under section 37 and in FORM GSTR-2 under section 38 has been extended and the circumstances so warrant, return in FORM GSTR-3B, in lieu of FORM GSTR-3, may be furnished in such manner and subject to such conditions as may be notified by the Commissioner.”
In exercise of the above delegated powers, CBEC issued Notification No. 21/2017-CT dated 08-08-2017 whereby it simply prescribed the due date for filing of GSTR-3B return for July & August as 20/08/17 and 20/09/17 respectively. It has no reference to the date of payment of tax dues.
Therefore, GSTR-3B needs to be filed in addition to the GSTR-3 only in case of extension of due dates for filing of GSTR 1 and GSTR 2. It is a nothing but a simplified summary return and the purpose of the return is for taxpayers to declare their summary GST liabilities for the tax period in a timely manner in a situation where the time-limit for filing GSTR 1 & 2 returns is extended.
Note: The language used in Notification No. 21/2017-CT reads “…shall be furnished in FORM GSTR-3B electronically through the common portal before the dates as specified…” Applying rules of literal interpretation, GSTR-3B should be filed BEFORE 20/08/2017 means the last date to file GSTR-3B is 19th August, 2017!! It should had used the words ‘on or before the dates…’
5. Conclusion: Last date for payment of GST for July, 2017 is 15/09/2017
It is evident from the above discussion & analysis, that the last date for payment of tax due for the month of July & August is 15th and 30th September, 2017 respectively. Section 39(7) has clearly linked the date of payment with the last date of filing GSTR-3 return. It is settled law that the provisions contained in the Act shall always override any contradictory provision in Rules or Notification. Substantive law always supersedes procedural law. Any attempt by the common portal to restrict taxpayers to submit & file GSTR-3B before payment of self assessed tax would be clear violation of law. Article 265 of the Constitution of India prohibits Government to collect any tax without the authority of law. GSTR-3B should be allowed to be filed on due date without forcing taxpayer to pay tax. If tax is not paid within the prescribed due date i.e. 15-09-17 for July, then only interest needs to be paid @ 18% per annum proportionately based on number of the days for which delay has been made.
In view of the above discussions, it is requested that the government should immediately come out with clarification regarding the due date of payment of tax, more so after the misleading information shared through twitter, press release and other forums.
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