GST updates and compliance calendar for June 2022

Goods and Service Tax (‘GST’) has evolved rapidly since its inception and is soon to complete half-a-decade of its tumultuous journey. The changing global dynamics and India’s response to the same have seen too frequent too many changes in the law. While the Government has proactively tried to reduce the burden on taxpayers, the lack of understanding of GST law on part of tax officers has led to unwarranted harassment of taxpayers in almost all aspects of GST law.

As the law approaches to its 5-year term, there is increasing chance of GST Council of making a big change in the tax rate slabs to make it more aligned and compensate states for loss of compensation cess.

A. GST Updates:

There have been few important judgments/ updates in GST over the month having far reaching tax implications on Indian taxpayers:

a) In a landmark judgement, the Apex Court of India has struck down the Central Government’s appeal to levy IGST on ocean freight in the Mohit Minerals Ltd. case.

b) In case of Northern Operating Systems Private Limited, Supreme Court held that secondment of employees by foreign entity qualifies as ‘manpower supply service’ and thus, leviable to service tax under in the hands of the Indian entity under reverse charge mechanism.

c) The late fee for filing of Form GSTR-4 for FY 2021-22 has been waived for the period 1 May 2022 to 30 June 2022.

d) The Central Board of Indirect Tax and Customs (‘CBIC’) has issued SOP in respect of NCLT cases for Insolvency and Bankruptcy Code, 2016 matters. GST and Customs authorities have been defined as Operational Creditors (Instruction No. 1083/04/2022-CX9 dated 23 May 2022).

e) The GST Investigation Wing has also issued another important Instruction with respect to deposit of tax during the course of search, inspection or investigation:

“Recovery of taxes not paid or short paid, can be made under the provisions of Section 79 of CGST Act, 2017 only after following due legal process of issuance of notice and subsequent confirmation of demand by issuance of adjudication order. No recovery can be made unless the amount becomes payable in pursuance of an order passed by the adjudicating authority or otherwise becomes payable under the provisions of CGST Act and rules made therein.”

B. GST Compliances Calendar:

The below tables capture these compliances in detail to ensure that the taxpayer files the returns and pay taxes under GST within the timeline to avoid late fee and interest liabilities.

GSTR-1 –

Note: From February 2022 onwards, if the GSTR-3B return for a particular month is not filed by the taxpayer, then it will not be allowed to file the GSTR-1 of the subsequent month. Thus, please ensure that GSTR-1 and GSTR-3B of April 2022 is filed on the GSTN portal.

GSTR-3B –

This return contains the details of outward supplies (consolidated data of GSTR-1), inward supplies subject to RCM payment, ITC details, exempt, nil-rated, and non-GST inward supplies, payment of tax details, etc.

Note:

ITC availed in GSTR-3B should be restricted to eligible ITC appearing in GSTR-2B. System-generated notices are getting issued to the taxpayers wherein ITC availed in the GSTR-3B is more than the ITC reflected in the GSTR-2B generated on the GSTN portal.

As per the Finance Act 2022, filing of GSTR-1 will become mandatory to file GSTR-3B for the tax period.

Other returns and forms–

Disclaimer: The above article is based on the author’s understanding and view of the tax laws, tax rules, the relevant circulars, and notifications. Please refer to the latest law and consult the author before forming any opinion basis the information provided above as tax laws are subject to frequent changes. The author is not responsible for any issues arising because of opinion based on the above article without consultation. In any manner whatsoever, the views expressed in this article should not be construed as the views of the firm, the author is associated with. The author can be contacted at gauravmittal756@gmail.com.