CBIC vide Circular no. 137/07/2020-GST dated 13.04.2020 have clarified in respect of certain challenges faced by the registered persons in implementation of provisions of GST Laws:

Cancellation of Goods and Services contract

The treatment under GST has been clarified in respect of certain transactions of supply of goods and services when get cancelled for any reason:

Nature of Supply Original Event Document Issued Trigger Event Treatment under GST
Services Advance Received Tax Invoice issued before supply       of service Contract cancelled before supply of service a)  Credit note to be issued under section 34 of CGST Act, 2017 for reduction of tax liability.

b)  Details of such credit notes shall be declared in the return for the month during which such credit note has been issued.

There is no need to file a separate refund claim.

c) Where there is no output liability against which a credit note can be adjusted, refund claim allowable under ‘Excess payment of tax, if any’ through FORM GST RFD-01.

Services Advance Received Receipt voucher Contract cancelled before supply of service Issue refund voucher under GST. Refund claim to be filed by filing FORM GST RFD-01 under the category ‘Refund of excess payment of tax’
Goods Goods supplied Tax invoice Goods returned a) Credit note to be issued under section 34 of CGST Act, 2017 for reduction of tax liability.

b) Details of such credit notes shall be declared in the return for the month during which such credit note has been issued.

There is no need to file a separate refund claim.

c) Where there is no output liability against which a credit note can be adjusted, refund claim allowable under ‘Excess payment of tax, if any’ through FORM GST RFD-01.

Deferment of filing of refund claim if expires on 31.03.2020

Deferment of filing of LUT

  • As per notification No. 35/2020-Central Tax, time limit for filing of LUT for the year 2020-21 shall stand extended to 30.06.2020 and the taxpayer can continue to make the supply without payment of tax under LUT provided that the FORM GST RFD-11 for 2020-21 is furnished on or before 30.06.2020.
  • Taxpayers may quote the reference no. of the LUT for the year 2019-20 in the relevant documents.

Due Date extension of deposit of TDS

  • The due date for furnishing of return in FORM GSTR-7 along with deposit of tax deducted for the period 20.03.2020 to 29.06.2020 has also been extended till 30.06.2020
  • No interest under section 50 shall be leviable if tax deducted is deposited by 30.06.2020.

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