Objective: The objective of this document is to summarize all the updates of GST (Notifications, Circulars, other amendments and updates) in one place. 12 Central tax notifications and 4 Circulars were issued during the month Dec’19. The same are being summarized below.

1. DIN made mandatory for all types of letters or notices, including Emails from CBIC

CBIC has mandated quoting of Document Identification Number (DIN) on all the communications including E-mails from its officers w.e.f. 24th Dec,2019.

Further, the board has also provided the standardized formats for the Search authorization, Summons, Arrest memos, Inspection notices issued by it’s officers w.e.f. 01-Jan-2020.

{Refer Circular No. 128/47/2019-CT, Date: 23rd Dec 2019}

2. SOP issued for officers to deal with non-filers

The board has also issued the standard operating procedure to be followed by its officers. The same has been summarized below.

1. 3 days prior to the due date of return – Automated reminder mail for filing return

2. If the return isn’t filed by due date – 2nd reminder

  • If the return isn’t filed within 5 days from the due date – Notice in Form GSTR-3A shall be issued
  • Standard format for GSTR-3A has been prescribed in the circular, the same may be automatically issued to the tax payer, based on return filing status
    • If the return isn’t filed within 15 days from the date of Notice – Order to pay tax arrived on the basis of information available in Form ASMT-13

Note:

1. No separate notice is required to be issued for best judgment assessment under section 62

2. For assessing the tax liability, the officer may consider GSTR-1, GSTR-2A and also the information gathered through inspection

3. Based on the facts of the case, the officer may resort to provisional attachment before issuing ASMT-13

i. If valid return is filed within 30 days from date of order, Order shall be deemed to be with drawn

{Refer Circular No. 129/48/2019-CT, Date: 23rd Dec 2019}

3. Circular 107/2019 issued for clarifying various doubts related to supply of Information Technology enabled Services (ITeS services) has been withdrawn.

{Refer Circular no. 127/46/2019-CT, Date: 04th Dec 2019}

4. RCM on renting of motor vehicles shall be applicable only for the cases where

i. The purpose of renting is for transportation of passengers

ii. Service provider is not a body corporate,

iii. Service recipient is Body corporate

iv. Service provider haven’t opted to charge tax at 12%

In order to implement the 37th council meeting decision to charge GST for renting of passenger transport vehicles under RCM, Notification No. 22/2019-CT(Rate) Date: 30th Sep 2019 has been issued to add new entry “15” in 13/2017, for levying GST under RCM on renting of motor vehicles to body corporate.

However, there were doubts raised w.r.t the drafting of the entry, where it says RCM is applicable for renting of any motor vehicle, if the supplier paying tax at 5%.

Hence, the department has amended the entry “15” vide Notification No. 29/2019-CT (Rate) for providing more clarity and also issued circular to explain the same.

Accordingly, the tax on renting of motor vehicles shall be liable under RCM only if the 4 conditions specified above are satisfied.

Further, the circular has clarified that, since the change in the entry is of clarificatory in nature, the effective date shall remain as 01-Oct-2019

{Refer Notification No. 29/2019-CT(Rate), Date: 31st Dec 2019 and Circular No. 130/49/2019-CT, Date: 31st Dec 2019}

5. New rule 86A has been inserted to authorize the officers to restrict the usage of  credit in Electronic credit ledger

New rule 86A has been inserted to authorize the commissioners to block the credit utilization of the credit i.e fraudulently availed or ineligible, for discharging any liability, subject to the conditions specified.

Below are the situations in which the commissioner can block the credit utilization:

1. Supplier/ Person availing credit (Recipient) found to be non-existent or not to be conducting any business from the regd. premises

2. Supplier haven’t paid the relevant tax to the govt.

3. Recipient is not in possession of Tax invoice/DNs

4. Recipient haven’t received the goods or services

5. Person availing credit is found to be non-existent or not to be conducting any business from the regd. premises

Subject to the above conditions, if the commissioner has the reason to believe that the credit is fraudulently availed or is ineligible, then, after recording the reasons in writing, can block the credit.

The credit blocked shall be automatically released after expiry of one year from the date of blocking the same.

Further, to avoid miss use of such powers to the officers, it is specified that the commissioner can’t authorize the persons below the rank of Assistant commissioner.

{Refer Notification No. 75/2019-CT Date: 26th Dec 2019}

6. E-Invoicing mandatory with effect from 1st April, 2020, if Aggregate turnover > 100Crs

i.  What is the concept of E-invoicing and how it works?

  • Since the pattern of issuing the invoice and the terms used are varying from person to person, it is not possible to configure a system to read all such types of invoice.
  • Hence, the govt. has come up with an idea of Schema for the invoice and E-invoicing. Accordingly, all the suppliers are required to mention the invoice details in the given form and length (i.e. as per Schema – FORM GST INV-01).
  • To ensure the same, they would validate the invoices upfront and issue an IRN. The validation includes validation of GSTINs for correctness and other details to check if the same are in line with the schema provided through FORM INV-01.
  • Further, this would also help the govt to curb the fake invoices.
  • Although there are multiple circulations on this subject, is not very clear as to how this works practically. Theoretically, below are the three steps involved in the processing:

ii. Whom it is applicable?

Persons with aggregate turnover exceeding 100 crores in a FY should issue invoice by including such particulars contained in FORM GST INV-01.

And the Invoice Reference Number (IRN) should be obtained electronically, for each of the invoices, by providing relevant information

iii. Further, QR code also has been made mandatory for B2C invoices issued by persons with Aggregate turnover exceeding 500 crores

iv. The tax payers can adopt this on voluntary basis, as per the timelines below:

a. Turnover of over ₹500 crore  – from 1st Jan, 2020

b. Turnover of over ₹100 crore  – from 1st Feb, 2020

v. Following are the portals for submitting details and generating IRN:

(i) www.einvoice1.gst.gov.in;

(ii) www.einvoice2.gst.gov.in;

……………………

(x) www.einvoice2.gst.gov.in;

Although it was planned to roll-out these portals from 1st Jan,2020, none them are working till date.

vi. The updated FORM INV-01 has been notified vide Notification No. 02/2020 – Central Tax  Dated 01.01.2020

Link for the notification: https://taxguru.in/goods-and-service-tax/cbic-prescribes-schema-e-invoices-gst.html

For Excel version of E-invoice, follow this link: https://www.gst.gov.in/newsandupdates/read/326

{Refer Notification No. 68,69,70,71 and 72/2019-CT, Date: 13th Dec 2019}

7. Measures for improving the compliance with GSTR-1 and thereby the matching with GSTR-2A

As the department is insisting on matching of Input tax credit with GSTR-2A through rule 36(4), it has also started taking the measures for increasing compliance with GSTR-1 by the suppliers on the other hand.

i. Late fee for delay in GSTR-1 has been waived of for the GSTR-1 of Jul’17-Nov’19 filed b/w 19-Dec-19 to 10-Jan-20

The department has waived of the late filing fees for those missed to file GSTR-1s for any period from Jul’17-Nov’19 but filed between 19-Dec-19 to 10-Jan-20.

Although the provisions for late filing fee 25/10 per day are existing, the same was neither collected nor waived off.

Since the waiver of late fee also doesn’t talk about the returns already filed, the liability for the same still exists. Also, it appears that the department is in view of collecting late filing fees in the upcoming months.

{Refer Notification No. 74/2019-CT, Date: 26th Dec 2019}

ii. New rule sub-rule 138E(c) has been inserted to authorize blocking of E-way bill for non-filing of GSTR-1 for any 2 months/quarters

1. Earlier, vide rule 138E, the department has introduced the system of automated blocking of E-way bill facility for non-filing with consecutive GSTR-3Bs/CMP-08s

2. Now the same has been extended for non-compliance with GSTR-1 for any two months/quarters.

Since there is no restriction in the portal for filing GSTR-1s chronologically, missing of any two GSTR-1s would result in blocking of E-way bills. Whereas, for 3B, it is mentioned as consecutive returns.

{Refer Notification No. 75/2019-CT, Date: 26-Dec-19}

8.  Extension of due dates

i. Due date for GSTR-3B of Nov’19 has been extended by 3 days, i.e. up to 23-Dec-19

ii. Due dates for filing GSTR-1, GSTR-3B and GSTR-7 for the tax payers of Jammu & Kashmir, for the months Jul’19-Oct’19 has been extended

The Due dates for filing GST returns for the registered persons whose principal place of business is in the State of Jammu and Kashmir has been extend as per below table:

Notification Return Related to Period Due date
63 & 64/2019 GSTR-1_Monthly Persons with t/o > 1.5Crs Jul’19-Oct’19 20-Dec-19
65/2019 GSTR-7_Monthly All TDS reg.ns Jul’19-Oct’19 20-Nov-19
66 & 67/2019 GSTR-3B_Monthly All Jul’19-Oct’19 20-Dec-19

iii. Due dates for filing GSTR-1, GSTR-3B and GSTR-7 for the tax payers of Assam, Manipur or Tripura, for the month Nov’19 has been extended

The Due dates for filing GST returns for the registered persons whose principal place of business is in the States Assam, Manipur or Tripura has been extend as per below table:

Notification Return Related to Period Due date
76/2019 GSTR-1 Monthly Persons with t/o > 1.5 Crs Nov’19 31-Dec-19
65/2019 GSTR-7 Monthly All TDS reg.ns Jul’19-Oct’19 20-Nov-19
77/2019 GSTR-3B Monthly All Nov’19 31-Dec-19

9. Others

i. GST rate for HSNs 3923/6305, 63053200 has been changed from 12% to 18%

{Refer Notification No. 27/2019-CTR, Date: 31st Dec 2019}

ii. Exemption long term lease premium paid for of industrial plots or plots for development of infrastructure for financial business to Development corporations and undertakings has been extended to the entities where the govt is holding 20% of the ownership

{Refer Notification No. 27/2019-CTR, Date: 31st Dec 2019}

iii. The last date for filing of appeals before the GST Appellate Tribunal against orders of Appellate Authority has been extended on account of non-constitution of benches of the Appellate Tribunals.

{Refer Removal of difficulties Order No. 9/2019-CT, Date: 03-Dec-19}

———–********———–

Thank you for the patient reading. Hope this document has added value to your knowledge. For the updates of the previous months and other article, please follow the link: http://www.cajvk.in/resource/Articles_Publication/gst1.aspx

For feedback or comments, please write to vamshi@cajvn.in

{Disclaimer: This document had been written to provide updates under GST in a simple manner.  The author shall not be responsible for any of the decision made based on the contents of this document.}

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