Suggestions on the proposed new return facility GST RET-1, ANX-1 and ANX-2 forms.
The new return facility is to be launched wef 01.04.2020. The government has invited feedback on the trial version of the new return facility. We submit herewith our experience while using the new trial version (beta).
1. 3L column of GST ANX-1 is not yet launched. It is the column to add missing ITC credit invoices that is not uploaded by the supplier.
As per my humble opinion this is the most significant column and its trial is of utmost significance as the industry will be required to learn such new facility of claiming input of missing invoices and unlearn old way of claiming input vide form 3B.
2. PAN details are also required to be furnished in case of unregistered RCM inward supplies in column 3H of ANX-1.
As per my humble opinion obtaining PAN from such unregistered dealers especially from transportation sector will be a very tedious task as most of the freight suppliers operate in unorganized sectors. Therefore, the requirement of the same should be dispensed with.
3. ITC credit bifurcation into ITC of services is required as per column 4E of GST RET 1
In my humble opinion this is a very tedious task as most of the small dealers maintain software that is unable to report such a bifurcation. Further ITC bifurcation column has no such relevance and it will only increase manual workload on the small dealers.
4. GST PMT-08 is not yet made available online for trial version.
5. Revision returns are permitted only upto 2 times.
As new return facility requires bill no wise upload of invoices, in my humble opinion, this revision limit should not be kept as various revisions also takes place during vouching and verification of invoices at the time of audit. So the revisions should be permitted without any limits untill the date of filing annual return.
6. In case of missing ITC bills, provisional credit is required to be taken in column 4A(10) of GST RET-1. This provisional credit is again required to be reversed in 4B(3) of RET-1 if the supplier uploads the missing invoices in subsequent tax periods.
As per my humble opinion such tracking of missing invoices that is later uploaded by the supplier will be very impractical. There is also a major scope of human error while doing such reversals and accepting such invoices vide ANX-2.
Further as per my humble opinion acceptance, rejection and pendency of invoices in form ANX-2 should be linked with annual return and such exercise should be permitted only till the time of filing annual return. Any mismatch that arises due to non reconcilement of ANX-1 and ANX-2 after filing annual return should be separately entered in a template designated for this purpose and should be made available to the corresponding dealers for verification. This process is same as filing ITC mismatch template during the period of VAT assessments in rajasthan.
7. Form RET-1 ‘eligible input column’ should not be linked with Form ANX-2 but dealers should be allowed to furnish there own purchase registers in a separate template instead of accepting/rejecting/pendency of each invoices in Form ANX-2. Acceptance/Rejection of invoices can remain open throughout the year till the date of filing annual return.
Any mismatch should be resolved on annual basis during the period of GST assessments by filing a separate template for this purpose which shall be made available to corresponding dealers for verification. Mismatch demand then getting rectified through application of rectification of mistakes wherein ledgers should be obtained from both the supplier and recipient parties for reconciling payment and sale-purchase entries verified with respective bank statements.