1. GST on Directors Salary has been put to rest by a recent decision of the Authority for Advance Rulings (AAR), Karnataka bench. AAR bench has clarified that if the director is an employee of the company, there will be no incidence of GST. However, if the director is a non-executive director (that is, a nominated director), and provides his or her services to the company, then the remuneration paid is subject to GST. In such cases, the ‘reverse-charge’ mechanism will apply and it is the company (recipient of the services) who will pay the GST.

AAR, Karnataka in the case of Shri. Anil Kumar Agarwal, a whole time Director of  a company (AR No. KAR ADRG 30/2020, daed 04.05.2020)

2. “Rule 67A Manner of furnishing of return by short messaging service facility

Notification No.38/2020- Central Tax ,dt. 05-05-2020

a registered person registered under the provisions of the Companies Act, 2013 (18 of 2013) shall, during the period from the 21st day of April, 2020 to the 30th day of June, 2020, also be allowed to furnish the return under section 39 in FORM GSTR3B verified through electronic verification code (EVC).”

– Notwithstanding anything contained in this Chapter, for a registered person who is required to furnish a Nil return under section 39 in FORM GSTR-3B for a tax period, any reference to electronic furnishing shall include furnishing of the said return through a short messaging service using the registered mobile number and the said return shall be verified by a registered mobile number based One Time Password facility.

3. Seeks to make amendments to special procedure for corporate debtors undergoing the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016

4. Notification No.39/2020- Central Tax ,dt. 05-05-2020 New GST Registration for corporate debtors undergoing corporate insolvency resolution process

New GST Registration for corporate debtors undergoing corporate insolvency resolution process In exercise of the powers conferred by section 148 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Government, on the recommendations of the Council, hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 11/2020-Central Tax, dated the 21st March, 2020, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 194(E), dated the 21st March, 2020, namely:—

In the said notification

  • in the first paragraph, the following proviso shall be inserted, namely: –

“Provided that the said class of persons shall not include those corporate debtors who have furnished the statements under section 37 and the returns under section 39 of the said Act for all the tax periods prior to the appointment of IRP/RP.”

  • for the paragraph 2, with effect from the 21st March, 2020, the following paragraph shall be substituted, namely: –

“2. Registration.-The said class of persons shall, with effect from the date of appointment of IRP / RP, be treated as a distinct person of the corporate debtor, and shall be liable to take a new registration (hereinafter referred to as the new registration)in each of the States or Union territories where the corporate debtor was registered earlier, within thirty days of the appointment of the IRP/RP or by 30th June, 2020, whichever is later:.

5. Delhi High Court in the case of Bharti Airtel Ltd. Vs UOI in its decision dated 05-05-2020 decided that Assessee be allowed to file rectified GSTR 3B. Para 4 of Circular 26/26/2017 to the extent it requires adjustment in ITC and output in the month in which error is discovered should be read down.

6. Supreme Court: Tax Authorities can’t give their own interpretations to legislative provisions on perception of trade practices.

Commercial Taxes Officer Vs Bombay Machinery Store (Supreme Court); Civil Appeal No. 2217 of 2011; 27/04/2020

7. There is no concept of ‘constructive delivery’ of goods under the Central Sales Tax Act, 1956, and inter-state movement of goods will terminate only when physical delivery is taken

Commercial Taxes Officer Vs Bombay Machinery Store (Supreme Court); Civil Appeal No. 2217 of 2011; 27/04/2020

8. Delhi High Court has allowed tax credits thru GST Trans-1 to all dealers upto the period of limitation of 3 years,

Bharti Airtel Limited Vs Union of India & Ors. (Delhi High Court); W.P. No. 6345/2018; 05/05/2020

9. Notification No. 40/2020- Central Tax ,dt. 05-05-2020

Extend the validity of e-way bills till 31.05.2020 for those e-way bills which expire during the period from 20.03.2020 to 15.04.2020 and generated till 24.03.2020

10. Notification No. 41/2020- Central Tax ,dt. 05-05-2020

Extend the due date for furnishing of FORM GSTR 9/9C for FY 2018-19 till 30th September, 2020

11. Notification No. 42/2020- Central Tax ,dt. 05-05-2020

Extend the due date for furnishing FORM GSTR-3B, Jan-March, 2020 returns for the taxpayers registered in the UT of Ladakh and Jammu & Kashmir

GSTR-3B              Period                 Due Date Union Territory
November 2019 to February ,2020 24-03-2020 Jammu & Kashmir
November 2019 to December ,2019  24-03-2020  Ladakh
January 2020 to March ,2020 20-05-2020  Ladakh

12. Notification No.43/2020- Central Tax ,dt. 16-05-2020

Seeks to bring into force Section 128 of Finance Act, 2020 in order to bring amendment in Section 140 of CGST Act w.e.f. 01.07.2017

The Central Board of Indirect Taxes and Customs (CBIC) notified retrospective amendments to section 140 of CGST Act, granting it power to prescribe a time limit for availing transitioning credit – the credit from pre-goods and services tax (GST) regime which was moved to the GST regime as input tax credit from July 1, 2017.

“The Central Government hereby appoints the 18th day of May, 2020, as the date on which the provisions of Section 128 of the Finance Act, 2020, shall come into force

Disclaimer: Every care has been taken in the preparation of this article to ensure its accuracy. The views contained in this article are personal and the contents of this document are solely for informational purpose and it does not constitute professional advice that may be required before acting on any matter. Adequate attention has been given to avoid any clerical error if it still persists. Kindly intimate us to avoid such error for the benefits of others.

The Author “CA. Mohit Kumar”can be reached at email- camohitkumar25@gmail.com

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