Analytical approach to the Changes under GST Law w.e.f. 01/02/2019
Introduction: Now a days, with the tremendous changes in GST law, we, as a professional should adapt changes.
Being a professional or taxpayer, Compliance with the GST provisions is a must-do task by us. GST council is favourable in adapting required changes as desired by the industries and Taxpayers. Taxpayers and Professionals are welcoming the outcomes. In this thread, 5 more notifications have been notified under Central Tax by the Central Board of Indirect Tax and Customs on 29/01/2019.
Analysis of Notifications: Notification No. 02/2019 (Central Tax) to 06/2019 (Central Tax) have been notified giving effect to the changes approved by the GST Council in last meetings. Further, Provisions of the Central Goods and Services Tax (Amendment) Act, 2018 has also been made effective so far. Notifications wise analysis are discussed below:
After the enforcement of the GST Law, first time, amendments in the acts are on the cusp of being notified. The Lok Sabha passed the GST Amendment Bill on 09/08/2018 and same was given presidential assent to become an act on 29/08/2018. Provisions are to be made effective once they are being notified. The GST council in its 31st GST Council Meeting held on 22nd December 2018, had announced through the press release dated 04/01/2019 that the effective date of applicability of amendments in GST Act(s) 2018 will be from 1st February 2019. However, no notification was issued in this regard so far. At this instant, this notification has been issued to proclaim such effective date just before three days. Provisions of the Central Goods and Services Tax (Amendment) Act, 2018 (31 of 2018), except clause (b) of section 8, section 17, section 18, clause (a) of section 20, sub-clause (i) of clause (b) and sub-clause (i) of clause (c) of section 28, shall come into force w.e.f. 01/02/2019. Whereas, provisions of clause (b) of section 8, section 17, section 18, clause (a) of section 20, sub-clause (i) of clause (b) and sub-clause (i) of clause (c) of section 28 had already been made effective retrospectively w.e.f. 01/07/2017.
Rules have been made further to amend the Central Goods and Services Tax Rules, 2017 which will be called as Central Goods and Services Tax (Amendment) Rules, 2019. Major points of these rules are as under-
Input tax credit shall be transferred to the newly registered entities in the ratio of the value of assets held by them at the time of registration. ‘Value of Assets’ means the value of the entire assets of the business whether or not input tax credit has been availed thereon.
Format of Form GST ITC-02A has also been given which shall be a declaration for transfer of ITC pursuant to registration under sub-section (2) of section 25.
(a) furnish the details of outward and inward supplies;
(b) furnish monthly, quarterly, annual or final return;
(c) make deposit for credit into the electronic cash ledger;
(d) file a claim for refund;
(e) file an application for amendment or cancellation of registration;
(f) furnish information for generation of e-way bill;
(g) furnish details of challan in FORM GST ITC-04;
(h) file an application for amendment or cancellation of enrolment under rule; and
(i) file an intimation to pay tax under the composition scheme or withdraw from the said scheme:
It is to be noted that where any application relating to a claim for refund or an application for amendment or cancellation of registration or where an intimation to pay tax under composition scheme or to withdraw from such scheme has been submitted by the goods and services tax practitioner authorised by the registered person, a confirmation shall be sought from the registered person and the application submitted by the said practitioner shall be made available to the registered person on the common portal and such application shall not be further proceeded with until the registered person gives his consent to the same.
Jurisdiction of Joint Commissioner (Appeals) has been defined through this notification with wider powers w.e.f. 01/02/2019.
To align the rates for Composition Scheme with CGST Rules, 2017, the words and figures , “an amount of tax calculated at the rate specified in rule 7 of the Central Goods and Services Tax Rules, 2017:” has been taken the place of “an amount calculated at the rate of half per cent” w.e.f. 01/02/2019. Thus, Notification No. 8/2017 – Central Tax, dated the 27th June, 2017 has been amended and Now, an eligible registered person, whose aggregate turnover in the preceding financial year did not exceed one crore rupees (fifty lakh rupees in case of specified states), may opt to pay, in lieu of the central tax payable by him, an amount of tax calculated at the rate specified in rule 7 of the Central Goods and Services Tax Rules, 2017:
To align special category states with the explanation in section 22 of CGST act, 2017, notification no. 65/2017 dated -central tax dated 15.11.2017 has been amended. As per notification no. 65/2017, persons making supplies of services, other than supplies specified under sub-section (5) of section 9 of the said Act through an electronic commerce operator who is required to collect tax at source under section 52 of the said Act, and having an aggregate turnover, to be computed on all India basis, not exceeding an amount of twenty lakh rupees in a financial year, as the category of persons exempted from obtaining registration under the said Act. In the first proviso, aggregate turnover has been limited to 10 lakh rupees in case of “special category States” as specified in sub-clause (g) of clause (4) of article 279A of the Constitution, other than the State of Jammu and Kashmir, which has now been amended vide notification 06/2019 and for the words, brackets, letters and figures “sub-clause (g) of clause (4) of article 279A of the Constitution, other than the State of Jammu and Kashmir”, words, brackets and figures “the first proviso to sub-section (1) of section 22 of the said Act, read with clause (iii) of the Explanation to the said section” shall be substituted. Accordingly, the proviso shall be read as
“Provided that the aggregate value of such supplies, to be computed on all India basis, should not exceed an amount of ten lakh rupees in case of “special category States” as specified in the first proviso to sub-section (1) of section 22 of the said Act, read with clause (iii) of the Explanation to the said section.”
Conclusion: In view of above, it can be said that with the elections around the corner, Governments is ready to give relief to GST taxpayers. GST Council has decided to extend the composition scheme for categories of services. Changes in Composition scheme policy will provide further impetus to the retails/service sector. The Council is continuously evaluating the various proposals of rate reduction, simplifying GST provisions, new schemes etc.
About the author: Author- Shilvi Khandelwal is a chartered accountant by profession. She is DISA, FCA, LLB and B.Com. She is engaged in GST implementation, writing & training in GST. Author can be reach at firstname.lastname@example.org.