The 43rd GST Council Meeting was a much-anticipated meeting considering the demands of the industry for extension of compliance requirements and other relaxations and benefits in imports etc. The first few months of year 2021 were one of the best in terms of GST revenue for the government despite the havoc created by the ongoing second wave of Covid 19. Thus, this meeting was anticipated to provide relief to the taxpayers and the amnesty scheme in GST was highly demanded by the industry.
The key recommendations of the GST Council are detailed below for your understanding and analysis:
1. Relaxation in GSTR-9 / GSTR-9C for FY 2020-21
√ GSTR-9C for the FY 2020-21 required to be filed by taxpayers with annual aggregate turnover above INR 5 Crores.
√ GSTR-9 / GSTR-9C for the FY 2020-21 made optional for taxpayer having aggregate annual turnover upto INR 2 Crores.
√ Self-certified audit report/ reconciliation statement to be applicable from FY 2020-21. Requirement of getting the audit report/ reconciliation statement from CA/ Cost Accountant done away with.
2. Amnesty scheme for reduction in late fee for return filing defaulters
Reduced late fee recommended for taxpayers who have not filed their GSTR-3B returns for the period July 2017 to April 2021 provided such returns are furnished between June 1, 2021 to August 31, 2021. The late fee is recommended as follows:
√ Where tax liability is NIL – Maximum late fee of INR 500/- per return.
√ In other cases – Maximum late fee of INR 1000/- per return.
3. Relaxation in interest and late fee on delayed filing of GST returns
The relaxation has been provided for the period of March 2021 to May 2021 GST returns as follows:
Interest relaxation
| Taxpayer turnover in previous FY | Tax Period | Periodicity of return filing | NIL rate of interest (if return is filed as per below timeline) | 9% rate of interest (if return is filed after timeline mentioned in column 3 but on or before date mentioned below) | 18% rate of interest (if the return is filed after the timeline mentioned in column 5) |
| 1 | 2 | 3 | 4 | 5 | 6 |
| Turnover > INR 5 crores | March 2021 | Monthly | – | 5 May 2021 | 6 May onwards |
| April 2021 | 4 June 2021 | 5 June onwards | |||
| May 2021 | 5 July 2021 | 6 July onwards | |||
| Turnover < INR 5 crores | March 2021 | Monthly or quarterly | 5 May 2021 | 19 June 2021 | 20 June onwards |
| April 2021 | 4 June 2021 | 4 July 2021 | 5 July onwards | ||
| May 2021 | 5 July 2021 | 20 July 2021 | 21 July onwards | ||
| Composition taxpayers | Quarter ending March 2021 | Quarterly | 3 May 2021 | 17 June 2021 | 17 June onwards |
Late fee relaxation
| Taxpayer turnover in previous FY | Principal place of business of taxpayer | Periodicity of return filing | Tax Period | NIL late fee condition (GSTR-3B to be filed on or before the below specified date) |
| Turnover > INR 5 crores | Anywhere in India | – | March 2021 | 5 May 2021 |
| April 2021 | 4 June 2021 | |||
| May 2021 | 5 July 2021 | |||
| Turnover < INR 5 crores | Anywhere in India | Monthly or quarterly | March 2021 | 19 June 2021 |
| April 2021 | 4 July 2021 | |||
| May 2021 | 20 July 2021 |
4. Capping of late fee under Section 47
The maximum late fee that can be levied under Section 47 of GST for delay in filing of returns for future tax periods is capped as below:
| GST Return | Conditions (if any) | Maximum Late fee per return |
| GSTR-1 and GSTR-3B | NIL tax liability | INR. 500 |
| Aggregate turnover upto INR 1.5 Crores in previous year | INR 2,000 | |
| Aggregate turnover between INR 1.5 Crores to INR5 Crores in previous year | INR 5,000 | |
| Aggregate turnover above INR 5 Crores in previous year | INR 10,000 | |
| GSTR-4 | Nil Tax liability | INR 500 |
| Other cases | INR 2,000 | |
| GSTR-7 | INR 2,000 |
5. IGST exemption on Covid-19 relief items import meant for donation
√ IGST exemption available on free of cost import of covid relief goods meant for free distribution extended till 31 August 2021.
√ IGST exemption granted on several specified COVID-19 related goods (such as medical oxygen, oxygen concentrators. diagnostic markers test kits and COVID-19 vaccines, etc.) including those imported on payment basis for donation to the government or state government recommended relief agency extended till 31 August 2021.
√ Relief on COVID-19 related individual relief items to be decided basis the recommendations/ report submitted by Group of Ministers (GoM) by 08 June 2021.
6. Other important relaxation recommended
√ Extension of due date for filing GSTR-1 for May 2021 to be extended by 15 days.
√ Companies allowed to file GST returns using EVC facility instead of DSC till 31 August 2021.
√ Due date of filing ITC-04 for quarter ending March 2021 extended to 30 June 2021.
√ Retrospective notification of payment of interest on net cash liability under Section 50 to be done at the earliest.
√ Rule 36(4) providing for availment of ITC for tax periods April to June 2021 to be applied cumulatively in the GSTR-3B return to be filed for June 2021.
√ The time limit for completion of action by GST authorities falling during 15 April 2021 to 29 June 2021 to be extended to 30 June 2021 subject to a few exceptions as will be notified therein.
The above recommendations may provide certain relief to the taxpayers for the time being in the ongoing second covid pandemic wave but the above are just recommendations as of now and will be effective once notified in official gazette.
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