Extension of GST Compliance due to 2nd Wave of COVID-19

Introduction:

1. COVID–19 situation has been absolutely alarming and the Central & State Governments alongwith local authorities are trying their level best to combat the current situation. To ease the burden, there are certain relaxations announced by the CBIC like the relaxations announced in 2020. The present note explains the relaxations announced vide various notifications issued on 01.05.2021.

Relaxation provided by CBIC:

2. The Government has prescribed[1] waiver of interest and late fees in different cases whereas encapsulated here as under:

2.1 Waiver of Late Fees & Interest:

i. These provisions are applicable for tax payers where principal place of business is in States of Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana or Andhra Pradesh or the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands or Lakshadweep.

ii. These provisions are applicable for tax payers where principal place of business is in States of Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha or the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi.

2.2 Extension of Due Dates:

[*IFF = Information Furnishing Facility]

Availment of ITC as per GSTR 2A/2B:

3. Relaxation[5] has been provided to such taxpayers availing ITC for the month of April 2021 by way of introduction of a proviso so as to provide that the said restriction of availment up to 5% of matched ITC shall not apply to ITC availed in FORM GSTR-3B for the month April, 2021. However, the cumulative effect of the same would be provided in FORM GSTR-3B for the tax period of May, 2021.

The moratorium for Legal, Procedural compliances by taxpayers / Government[6]:

4. The Government has prescribed that in the following cases, the time limit shall be extended upto 31.05.21 where the time limit was falling between 15.04.21 to 30.05.21:

(a) completion of any proceeding or passing of any order or issuance of any notice, intimation, notification, sanction or approval or such other action, by whatever name called, by any authority, commission or tribunal, by whatever name called, under the provisions of the Acts stated above; or

(b) filing of any appeal, reply or application or furnishing of any report, document, return (ISD return, TDS returns, TCS returns and Non-Resident Taxable person), statement or such other record, by whatever name called, under the provisions of the Acts stated above;

5. The above extension of time-limit shall not be applicable for filing of returns, principles of issue of invoice, provisions relating to time of supply, search & seizure, arrest provisions, E-way bills under GST.

6. In cases where the time limit for verification of documents for registration was falling within 01.05.21 to 31.05.21, the time limit has been extended upto 15.06.21 for completion for such action.

7. In cases where notice has been issued for part/full rejection of refund and order issuance time limit falls within 15.04.21 to 30.05.21, the time limit to issue order shall be extended upto 31.05.21 or 15 days of receipt of reply from tax payer, whichever is later.

Illustration:

In a hypothetical case, Mr A has applied for refund u/r 89(4) of the CGST Rules, 2017

*In this scenario it is considered that, the issuing authority has not taken the benefit of issuing RFD-03 by availing extended benefit of Notification No. 41/2021-CT dated 01.05.2021. In case, if revised time limit as per the said notification is availed, then time limit applicable for filing fresh refund application will have to be determined by litigating the same.

Note: Such a scenario is illustrative in nature and may mutatis mutandis apply to all such compliances/procedures under the GST law except those specifically excluded.

IGST exemption on import of goods for COVID-19:

8. In light of the acute shortage of medicines and other related goods during the ongoing pandemic, India is receiving help from many foreign nations. To balance the same, certain goods attached as Annexure A would be exempt[7] from IGST [i.e. additional custom duty (equivalent to GST) applicable under section 3(7) of the Customs Tariff Act, 1975 read with section 5 of IGST Act, 2017] subject to that the following conditions upto 30.06.2021 and shall also apply to goods which are pending for clearance on the date of issue of this order subject to following conditions[8]:

8.1 Goods imported would be distributed free of cost for the purpose of COVID-19 relief by any entity, relief agency or statutory body appointed by the nodal authority. Further, such nodal authority shall by appointed by the State Government.

8.2 Before clearance of the goods, the importer produces a certificate from a nodal authority, appointed by a State Government, to the Deputy/Assistant Commissioner of Customs, certifying that the imported goods are meant for free distribution for COVID-19 purpose.

8.3 The importer produces before the Deputy /Assistant Commissioner of Customs, as the case may be, at the port of import within a period of six months from the date of importation, or within such extended period not exceeding nine months from the said date as that Deputy/Assistant Commissioner of Customs may allow, a statement containing details of goods distributed free of cost duly certified by the said nodal authority of the State Government.

Annexure A

1. Goods covered under Notification No 27/2021-Costoms dated 20.04.2021

2. Goods covered under Notification No 28/2021-Costoms dated 24.04.2021

[1] Notification No. 08/2021-CT dated 01.05.2021, Notification No. 09/2021-CT dated 01.05.2021, Notification No 10/2021-CT dated 01.05.2021, Notification No 1/2021-IT dated 01.05.2021 and Notification No 1/2021-UTT dated 01.05.2021

[2] Notification No 12/2021-CT dated 01.05.2021

[3] Notification No 11/2021-CT dated 01.05.2021

[4] Notification No 13/2021-CT dated 01.05.2021

[5] Proviso inserted to Rule 36(4) by way of Notification 13/2021 dated 01.05.2021

[6] Notification No 14/2021 –CT dated 01.05.2021

[7] Ad hoc Exemption Order No. 4/2021-Customs dated 03.05.2021

[8] Instructions 09/2021 – Customs dated 03.05.2021

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In case of any clarification/queries, please feel free to contact the undersign: