Insertion of New Sub-Rule (1A) To Rule 12 of The Central Goods And Service Tax Rules, 2017 related to persons who are required to obtain GST registration in order to collect tax (TCS).
Vide notification no. 74/2018 – Central Tax dated 31st December, 2018, the Central Board of Indirect Taxes and Customs has introduced the Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018 and with the said introduction, new sub-rule (1A) to rule 12 has been inserted.
APPLICABILITY OF NEWLY INSERTED SUB-RULE (1A) TO RULE 12 –
It is substantial to note here that the new sub-rule (1A) to rule 12 is applicable only to a person who is required to take registration to collect the tax according to the provisions of the section 52 of the Central Goods and Service Tax Act, 2017.
Provisions of section 52 of the Central Goods and Service Tax Act, 2017 requires E-Commerce Operators to collect tax at source in respect of taxable supplies made through its portal by other suppliers and the consideration / amount in respect of such supplies is being collected by the e-commerce operator.
UNDERSTANDING THE NEWLY INSERTED SUB-RULE –
Rule 12 of the Central Goods and Service Tax Rules, 2017 contains provisions relating to the registration of the persons who are required to deduct tax at source (TDS) or person who is required to collect tax at source (TCS) and new sub-rule (1A) has been inserted to rule 12.
The bare reading of newly inserted sub-rule (1A) to rule 12 is provided hereunder for ready reference –
(1A) – A person applying for the registration to collect tax as in accordance with the provisions of section 52, in the State or Union territory where he does not have the physical presence, shall mention the name of the State / Union territory in PART A of the application in the FORM GST REG-07 and mention the name of the State / Union territory in PART B thereof in which the principal place of business is located which may be different from the State or Union territory mentioned in PART A.
The gist of the above newly inserted sub-rule (1A) to rule 12 of the Central Goods and Service Tax Rules, 2017 is being summarized hereunder –