CMA Rakesh Bhalla
CMA Rakesh Bhalla

GST Returns –Due date for filing specified returns extendedNotification No. 54/2017 –Central Tax, 30-10-2017 and Notification Nos. 5253/2017-Central Tax, both dated 28-10-2017 and Notification Nos. 4144/2017-Central Tax, all dated 13-10-2017 have been issued for this purpose.

Return Month/Quarter Revised due date Additional comments
GSTR-2 For the month July 2017 30-Nov-2017 To be filed by all registered persons.
GSTR-3 For the month July 2017 11-Dec-2017 To be filed by all registered persons.
GSTR-4 For quarter July to Sep. 2017 15-Nov-2017 To be filed by Composition supplier.
GSTR-5A For the month July, August & September 2017 20-Nov-2017 To be filed by person supplying online information and database access or retrieval services from a place outside India to a non-taxable online recipient.
GSTR-6 For the month July, August & September 2017 15-Nov-2017 To be filed by Input Service Distributor (ISD).
ITC-01 For the month July, August & September 2017 30-Nov-2017 To be filed by registered persons, who became eligible for ITC under CGST Section 18(1).
ITC-04 For the quarter July to September 2017 30-Nov-2017 In respect of goods dispatched to a job worker or received from a job worker or sent from one job worker to another.

♦ Late fees for delayed filing of GSTR-3B waivedlate fee for delayed filing of summary Return GSTR-3B for the months of August and September 2017 has been waived as per Notification No. 50/2017-Central Tax, dated 24-10-2017.

♦ Due date for filing and revising TRAN-1 extended to 30 NovemberDue date for both filing and revising Form GST TRAN-1 has also been extended to 30-11-2017. Order Nos. 7/2017-GST and 8/2017-GST, both dated 28-10-2017.

♦ Nominal rate of GST for supplies to merchant exporterRegistered suppliers can now supply goods to registered recipient for the purpose of export on payment of GST at the effective rate of 0.05% CGST (0.1% IGST), subject to prescribed conditions. Notification No. 40/2017-Central Tax (Rate), dated 23-10-2017.

♦ Registration exemption for inter-State supplies of services Service providers whose annual aggregate turnover is less than Rs. 20 lakhs (Rs. 10 lakhs in special category states except J & K) have been exempted from mandatory registration even if they are making inter-State taxable supplies of services. Notification No. 10/2017-Integrated Tax, dated 13-10-2017.

 Deemed exports -Specified supply of goods notified for benefit of deemed exports

> Supply of goods or capital goods by a registered person against Advance Authorisation or Export Promotion Capital Goods Authorisation, respectively, would be eligible for benefit of deemed exports under GST.

> Similarly, supply of goods by a registered person to Export Oriented Unit (EOU) and supply of gold by a bank or Public Sector Undertaking specified in Notification No. 50/2017-Cus., against Advance Authorisation would also be eligible for deemed export benefit. Notification No. 48/2017-Central Tax, dated 18-10-2017 has been issued in this regard.

> Rule 89(1) of the Central Goods and Services Tax Rules, 2017 has also been amended by CGST (Tenth amendment) Rules, 2017, dated 18-10-2017, to allow supplier of deemed export supplies to file application for refund of tax paid, subject to conditions. It may be noted that Notification No. 49/2017-Central Tax further lists evidences which are required to be produced by the supplier of deemed export supplies for claiming refund.

♦ RCM liability on procurement from unregistered dealers, deferred – Liability under RCM under CGST Section 9(4), IGST Section 5(4) and UTGST Section 7(4), has been deferred till 31-3-2018. Such liability is attracted when a registered person procures taxable goods or services from unregistered person. Exemption till 31-3-2018 has now been granted by amending Notification No. 8/2017-Central Tax (Rate) in respect of CGST and Notification No. 8/2017-Union Territory Tax (Rate) for UTGST. Similar exemption from IGST has also been provided by Notification No. 32/2017-Integrated Tax (Rate). It may be noted that exemption was earlier available to such supplies not exceeding Rs. 5000/-per day only.

RCM liability –Additional entries Scope of RCM under CGST Section 9(3) has been widened by inclusion of more entries. Any registered person procuring used vehicles, seized and confiscated goods, old and used goods, waste and scrap from Central Government, State Government, Union territory or a local authority, is now liable to GST. Under services, Reserve Bank of India has been made liable for GST on supply of services by the members of Overseeing Committee to the RBI. Notification Nos. 36/2017-Central Tax (Rate) and 33/2017-Central Tax (Rate) have been issued for this purpose. Similar Notifications have also been issued under IGST and UTGST provisions.

Area based exemption –Budgetary Support Scheme introduced The benefit under the scheme notified by the Department of Industrial Policy and Promotion (DIPP) by a Notification dated 5-10-2017 will be available by way of refund of tax paid and no upfront exemption would be available. Amount of budgetary support allowed would be sum total of 58% of the Central Tax and 29% of the Integrated Tax, paid through debit in cash ledger account after utilization of input tax credit.

Rate of GST on specified goods revised Some of the important items on which GST rate revised under Notification Nos. 34 & 35/2017-Central Tax (Rate), both dated 13-10-2017 under CGST are:

> Nil rate of GST has been prescribed for Duty Credit Scrips.

> 5% CGST or 5% IGST is now leviable on Mangoes sliced, dried; Khakhra, plain chapatti or roti; unbranded namkeens, bhujia, mixture, chabena and similar edible preparations; medicaments (including those used in Ayurvedic, Unani, Siddha, Homeopathic or Bio-chemic systems), waste, parings or scrap, of plastics and rubber (other than hard rubber).

> 6% CGST or 12% IGST is payable on sewing thread of manmade filaments and manmade staple fibres; synthetic or artificial filament yarns, and; yarn of manmade staple fibres.

> 9% CGST or 18% IGST is now leviable on poster colour; modelling pastes for children’s amusement; fittings for loose-leaf binders or files, letter clips, letter corners, paper clips, indexing tags and similar office articles.

GTA service provided to unregistered person, exempted

> Services provided by a Goods Transport Agency to an unregistered person, including an unregistered casual taxable person are now liable to Nil GST.

> Such exemption is however not available to service provided by a GTA to any factory registered under Factories Act; Society registered under Societies Registration Act; Co-op Society established by or under any law; body corporate established, by or under any law; partnership firm; or casual taxable person registered under CGST,IGST,SGST or UTGST laws.

Amendments made by Notification No. 32/2017-Central Tax (Rate), dated 13-10-2017 in Notification No. 12/2017-Central Tax (Rate).

Job work services –GST rates for certain services revised downwardsSome of the important services covered for amendment under Notification No. 31/2017-Central Tax (Rate), dated 13-10-2017 are:

> Job work services in relation to all products classifiable under Chapter 71 will now be liable to 2.5% CGST. Earlier this rate did not cover imitation jewellery.

> Job work services in relation to food and food products falling under Chapters 1 to 22 will be liable to CGST at the rate of 2.5%.

> Job work in relation to printing of all goods falling under Chapter 48 or 49 which attract CGST at the rate of nil, 2.5% or 6% would now be liable to CGST at rate of 2.5% / 6%.

> Job work in relation to all products falling under Chapter 23, except specified dog and cat food, is now liable to CGST at the rate of 2.5%.

> Job work in relation to manufacture of clay bricks falling under TI 69010010 is liable to CGST at the rate of 2.5%.

Exemption to supply of services having place of supply in Nepal or Bhutan, against payment in Indian Rupees Notification No. 9/2017-Integrated Tax (Rate) has been amended by Notification No. 42/2017-Integrated Tax (Rate), dated 27-10-2017 by the CBEC to provide for exemption to supply of services having place of supply in Nepal or Bhutan, against payment in Indian Rupees.

Motor vehicles –Lease or sale of vehicles purchased before 1-7-2017 Effective rate of GST on motor vehicles purchased and leased before 1-7-2017 would now be 65% of CGST/IGST/UTGST specified under Notification Nos. 1/2017 (Rate) of CGST, IGST or UTGST law plus Compensation Cess. Similarly, tax rate would be 65% of GST + Compensation Cess in case of sale of motor vehicles by registered person when the vehicle was purchased by him prior to 1-7-2017 and no ITC of Central Excise duty or VAT or any other taxes was taken. It may be noted that such rate of tax would be applicable till 30-6-2020. Notification Nos. 37/2017-Central Tax (Rate), 38/2017-Integrated Tax (Rate) and 37/2017-Union Territory Tax (Rate) have been issued for this purpose.

Works Contract services –GST rates revised for certain specified services CBEC has revised downwards the rates of GST on Works Contract services involving predominantly earth works (i.e. constituting more than 75% of the value of the works contract) supplied to Central/ State Government, Union Territory, Local Authority, Governmental Authority/ Entity. The new rate of CGST would now be 2.5%. Similarly, new rate of CGST on Works Contract service in respect of offshore works contract relating to oil and gas exploration and production (E&P) in the offshore area beyond 12 nautical miles, would now be 6%.

Relaxation from tax on advance received by SMEs Registered person whose aggregate turnover in preceding financial year did not exceed Rs. 1.5 crore or whose aggregate turnover in the year in which he has obtained registration is likely to be less than Rs. 1.5 crore and who did not opt for the Composition levy, are no more liable to pay GST on receipt of advance in respect of any supply of goods. Notification No. 40/2017-Central Tax, dated 13-10-2017 states that such persons shall pay tax on the outward supply of goods at the time of supply as specified in Sections 12(2)(a) and 14.

Proper officer for refund, notified CBEC has notified officers appointed under the respective State GST Acts or the Union Territory GST Act, 2017 who are authorized to be the proper officers for the purposes of Section 54/55 of the said Acts by the Commissioner, to act as proper officers for sanction of refund under Section 54/55 of CGST Act and the Rules. Notification No. 39/2017-Central Tax, dated 13-10-2017 has been issued in this regard.

Printing contracts –Taxability clarified Circular No. 11/11/2017-GST, dated 20-10-2017 issued in this regard clarifies that printing job in respect of books, pamphlets, brochures and annual reports using the content supplied by recipient will be treated as supply of service. However, printing contracts for envelopes, letter cards, printed boxes, etc., involving use of logo or design provided by recipient, would be treated as supply of goods.

Supply on approval basis –Tax liability clarified CBEC has clarified that goods which are taken for supply on approval basis can be moved from the place of business of registered supplier to another place within the same State or to a place outside the State on a delivery challan along with e-way bill, wherever applicable. Circular No. 10/10/2017-GST, dated 18-10-2017 also notes that person carrying the goods for such supply can carry the invoice book with him so that he can issue invoice once supply fructifies. Where supplier carries goods from one State to another and supplies them in a different State, Integrated Tax would be payable.

Fabric cut and sold in unstitched state remains as fabric By Circular No.13/13/2017-GST, dated 27-10-2017, CBEC has clarified that fabric cut from bundles or thans and sold in that unstitched state would continue to be classifiable as fabric under respective heading according to their constituent materials.

Registration application may be filed till 31-12-2017 Time for submitting the application in the Form GST REG-26, electronically, has been extended till 31-12-2017. Form GST REG-26 pertains to application for enrolment of existing taxpayer. Order No. 6/2017-GST, dated 28-10-2017 has been issued for this purpose.

Composition Levy –Aggregate turnover limit and last date for option

> Aggregate turnover limit for eligibility of Composition levy scheme has been revised to Rs. One crore, except in case of registered persons in certain specified States. Registered persons in States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Himachal Pradesh would now be eligible for Composition levy if the aggregate turnover is not above Rs. 75 lakh. Notification No. 46/2017-Central Tax and 16/2017-Union Territory Tax has been issued for this purpose. Further, amendments have been made in Central Goods and Services Tax Rules, 2017, Rule 3(3A) to provide for exercise of option of Composition levy by eligible persons till 31-3-2018.

> Statement in Form GST ITC-03 in accordance with provisions of CGST Rule 44(4) will now be required to be furnished within ninety days from the day on which such person commences to pay tax under Section 10.

> Further, according to Order No. 5/2017-GST, dated 28-10-2017, period for intimation of details of stock held on the date preceding the date from which Composition levy is opted in Form GST CMP-03 has been extended till 30-11-2017.

Relief to small taxpayers in compliance of GST law According to minutes of the meeting of the GST Council held on 6th of October, 2017, the Council has decided that:

> FSmall taxpayers with annual aggregate turnover up to Rs. 1.5 crore will be required to file quarterly returns in Form GSTR-1, 2 & 3 and pay GST on quarterly basis, starting from October-December, 2017 quarter.

> Registered buyers from such small taxpayers would however be eligible to avail input tax credit on monthly basis.

> All taxpayers will be required to file monthly Form GSTR-3B till December, 2017 and GSTR-1, 2 and 3 for the months of July, August and September, 2017.

Notifications to bring into effect such decision are yet to be issued by CBEC.

Detention of goods for not carrying documents for inter-State movement of goods not valid Madras High Court has allowed Writ Petition against detention of goods by the State Government for alleged non-compliance with the requirement of carrying the prescribed documents under the IGST Act.

[Ascics Trading Company v. Assistant State Tax Officer-2017-TIOL-23-HC-KERALA-GST]


Advance authorisation, EPCG and EOU schemes revised to allow exemption of IGST on imports

> Exemption from IGST and Compensation Cess levied under Sections 3(7) and 3(9) of Customs Tariff Act is now available in case of imports under Advance authorisation and EPCG scheme, subject to condition of physical exports.

> Similarly, IGST and Compensation Cess exemption is also available to imports by EOUs.

> These exemptions are available till 31-3-2018.

> While changes in FTP Chapters 4, 5 and 6 made by DGFT Notification No. 33/2015-20, dated 13-10-2017, consequential changes have also been made by CBEC in Notification 52/2003-Cus., 16/2015-Cus., 18/2015-Cus., 20/2015-Cus., 22/2015-Cus. and 45/2016-Cus., by Notification Nos. 78 and 79/2017-Cus., both dated 13-10-2017.

Duty credit scrips –Validity period increased Validity period of duty credit scrips issued under Chapter 3 of the Foreign Trade Policy has been increased from 18 months to 24 months. Public Notice No. 33/2015-20, dated 23-10-2017 has been issued in this regard.

EPCG Scheme –Re-export for repairs allowed

> DGFT has amended Para 5.25 of the Handbook of Procedures Vol. I to allow re-export of capital goods imported under EPCG scheme.

> Such re-export would be allowed with permission of Regional authority of the Customs authority, within 3 years of date of Customs clearance.

> Para 5.25 as revised by Public Notice No. 29/2015-20, dated 9-10-2017 also states that duty component on the expenditure incurred on such repairs as well as insurance and freight, both ways shall be taken into account for re-fixation of EO.

EPCG scheme –Extension of EO period and acceptance of installation certificate Regional authorities may consider requests for block-wise EOP extension, for the requests received upto 31-3-2018, which have been submitted beyond the prescribed time, on payment of additional composition fee of Rs. 5000/-in addition to payment of regular composition fee as applicable.

Advance authorisation –Clubbing of authorisations and extension of Export Obligation period One time relaxation provided for extension of export obligation period of Advance authorizations issued under FTP 2002-07, FTP 2004-2009 and Advance Authorisations issued prior to 5-6-2012 in FTP 2009-14, subject to conditions and procedures prescribed. According to Public Notice No. 34/2015-20, dated 24-10-2017 issued for this purpose, last date for submission of application for these will be 31-3-2018.

Gifts imported by post or air, exempted from BCD and IGST Bona fide gifts of CIF value less than Rs. 5000 imported by post or air have been exempted from BCD and IGST. Serial No. 608A inserted by Notification No. 77/2017-Cus., dated 13-10-2017 in Notification No. 50/2017-Cus., also states that such exemption is available only when such gifts are exempted from any import prohibition under the Foreign Trade (Development and Regulation) Act, 1992.

SAD refund –Sawing of imported logs before local sale, immaterial Andhra Pradesh High Court has allowed the appeal filed by the importer in a case of refund of SAD where the importer had sold the imported wooden logs locally after sawing them into smaller pieces. [Commissioner v. Gayatri Timbers Pvt. Ltd. -2017-TIOL-2165-HC-AP-CUS]

Project Import benefit to single or composite machine CESTAT Chennai has allowed appeal of importer in a case involving import of single machine under the benefit of Project Imports.

[Hydro S&S Inds Ltd. v. Comm.-Final Order No. 42112/2017, dated 18-9-2017, CESTAT Chennai]

DTA clearance by SEZ –Importer In a case involving DTA clearance by SEZ, where the SEZ unit filed Bills of Entry and made the payment of Customs duty, CESTAT Ahmedabad has held no duty can be demanded from the SEZ unit in as much as the SEZ unit was not the importer according to the definition of importer under Section 2(26) of the Customs Act, 1962.

[Anita Exports v. Commissioner-2017-VIL-885-CESTAT-AHM-CU]

FTA concession –Classification of one input and final product in same heading Observing that genuineness of the certificates of origin was not in dispute, and that the certificates issued by Sri Lankan authorities were found to be valid after specific queries made by the Customs authorities in India, CESTAT Delhi has allowed the appeal of the importer allowing benefit of Notification No.26/2000-Cus.

[Minakshi Exports v. Commissioner-2017-VIL-872-CESTAT-DEL-CU]

Exemption –Non-following of procedure under IGCRDMEG Rules at time of clearance when not fatal CESTAT Chennai has allowed appeal filed by importer in a case where the procedure under Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods), Rules, 1996 was not followed by the importer at the time of Customs clearance.

[Troikka Pharmaceuticals Ltd. v. Commissioner-2017-VIL-808-CESTAT-CHE-CU]

Containers of durable nature –Scope CESTAT Hyderabad has allowed benefit of Notification No. 104/95-Cus., to packing material viz., PP cups and lids and spoons intended for packing perishable goods to be exported by them.

[Sam Agri Tech. Ltd. v. Commissioner–2017 (353) ELT 358 (Tri.-Hyd.)]

Central Excise and Service Tax

Valuation –Non-inclusion of Passenger Service Fee and Airport tax in value for Transportation of passengers by air service CESTAT Chandigarh has allowed the appeal filed by an airline in respect of inclusion of Passenger Service Fee and Airport tax in the value of service of Transportation of Passengers by Air.

[Lufthansa German Airlines v. Commissioner-Final Order No. 61764/2017, dated 8-9-2017, CESTAT Chandigarh]

Printed advertising material classifiable as articles of printing industry

[Commissioner v. Golden Printers-2017 (354) ELT 410 (Tri. -Del.)]

Remission of duty -Evidence including FIR, report of City and District Magistrate and grant of insurance claim, enough to prove ‘accidental’ cause of fire.

[Raltronics India Pvt. Ltd. v. CESTAT-2017 (354) ELT 324 (All.)]

Interest when duty paid under wrong accounting head Adjudicating authority had raised a demand on the appellants for Basic Excise Duty, despite the fact that the assessee had paid the same amount wrongly under accounting head of Education Cess and SHE Cess. Holding so, the Gujarat High Court observed that interest is payable on amount due and payable, and amount was in fact due in the case. However, it was also held that the appellant was entitled to interest on the eligible refund of amount paid by it under different accounting head.

[Asiatic Colour Chemical Industries v. Commissioner-2017 (354) ELT 354 (Guj.)]

No Personal penalty on the Managing Director when the company opting under Section 11A(1A) of the Central Excise Act, 1944 had paid full duty demanded along with interest and 25% penalty.

[Commissioner v. Rajendra S Jadhao-2017-TIOL-3678-CESTATMUM]

Proprietary concern not liable to Service tax under RCM in respect of services received from GTA [Andal Motors v. Comm.–Final Order No. 42111/2017, dated 18-9-2017, CESTAT Chennai]

Employee Provident Fund Organisation is a public authority performing statutory Functions CESTAT Delhi has held that Employee Provident Fund Organisation is a public authority performing statutory functions as mandated by the an Act of the Parliament.

[Employee Provident Fund Organisation v. Commissioner–2017 (4) GSTL 294 (Tri. –Del.)]


Aloe vera juice covered under expression “processed or preserved vegetable” – Allahabad High Court has held that aloe vera juice is covered by the expression “processed or preserved vegetable” under Entry 103 of Schedule-II of U.P. Value Added Tax Act.

[Commissioner v. Forever Living Imports (I) Pvt. Ltd.-2017-VIL-510-ALH]

Price less than the minimum price fixed by government when valid Patna High Court observed that price fixed in the Circular dated 18-7-2013 was only a modality for preparation of the software and to get an alert with regard to evasion of tax/duty and to facilitate function of the Suvidha Scheme Software and for inquiry purpose. It was noted that if the transporter or the trader carries the identified goods at lesser price than the quoted minimum price, then an inquiry is to be conducted and if authenticity of rate claimed by the assessee is established then the price or rate as claimed can be accepted for imposition of duty/tax.

[Bhagwati Coke Industries Pvt. Ltd. v. State of Bihar-2017-VIL-532-PAT]

*Member ZAC Chandigarh, Service Tax, Govt. of India, Member RAC Chandigarh, Central Excise & Customs, Member Indirect Tax committee SIAM , Member, ASSOCHAM Indirect Taxes Committee, Chief General Manager Finance- SML Isuzu Ltd. , Winner Achiever  Award 2015 By ICAI (CMA)

Information source- M/s LKS, M/s Nitya tax Associates, Economic Times, Financial express, and other sources-many thanks to all.

(Author can be reached at [email protected])

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  1. Vijay Kumar says:

    From the article, it appears that GST rate for Job work in certain chapters has been reduced to 2.5%. It is not clear if the Job Work being done by MSME parties who do the job work of Engineering fields, has also been reduced as per notification dated 17.10.2017.
    As a matter of fact, the utility of application of 18% GST by WE job workers is not understood.
    Just consider that a Job Worker earns 10%. Say a Job worker does One Lac Rupees Job Work, and earns 10,000/-. Now, he has to pay Rs. 18,000/- as GST, which he is likely to get back in around 4 months.
    How does the equation like this work?

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January 2021