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Last week, Reserve Bank of India raised the repo rate by 50 basis points to 4.9% which will make borrowing costlier. It has kept the GDP growth rate for financial year 2023 at 7.2% unchanged but inflation projection has been hiked to 6.7%.

Factory output for April, 2022 has risen to 7.1% which is on eight month high. All these factors indicate stability and growth in tax revenue too.

Government expects tax collection in the current fiscal better than the budget estimates. In 2021-22, indirect taxes grew by 20% while indirect taxes by 49% and tax to GDP ratio was at 11.7%, highest since 2000. This growth expectation has considered concessions in customs and indirect taxes.

Fitch rating has also upped India’s sovereign rating to ‘stable’ from ‘negative’ due to reduced downside risks to medium term growth as rapid economic recovery. With this one, now all three agencies, viz, Moody’s, Fitch and S & P, all have expressed a ‘stable’ outlook on Indian economy. OECD has now projected Indian economy to grow at 6.9% in financial year 2023 while the world economy may grow at 3% in view of Russia’s war.

On how to tax crypto’s, the GST Law Committee is under discussions on classification and valuation for taxing crypto transactions. As of now, there is no clarity on how crypto or virtual assets will be taxed. GSTN has released functionalities on registration, returns and refunds. CBIC issued Notification No. 8/2022-CT dated 07.06.2022 to waive interest for non filing of GSTR-8 by specified e-commerce operators.

As India nears completion of five years of GST, the GST Council will be back in Srinagar after five years as next meeting is scheduled to take place this month end. The 47th meeting of the GST Council will be held on June 28-29 in Srinagar. The meeting is expected to be dominated by the issue of compensation to States besides consideration of report by Group of Ministers (GoM) on online gaming casinos and horse racing, review of some exemptions and rationalization of inverted duty structure (IDS) on textiles and others.

Waiver of interest for specified electronic commerce operators for specified months

  • Interest leviable on late furnishing of Form GSTR-8 (monthly statement for tax collection at source filed by electronic commerce operators who collect tax at source) for the month of December 2020 has been waived in case of specified registered persons (60 GSTINs notified) who could not file their return by the due date due to technical glitch but had deposited the collected TCS of said month in the electronic cash ledger.  The interest has been waived for the period starting from the date of depositing TCS in electronic cash ledger till the date of furnishing of Form GSTR-8.
  • Interest leviable on late furnishing of Form GSTR-8 for the months starting from September 2020 till January 2021 has been waived for the specified registered persons (12 GSTINs notified) who could not file their return by the due date due to technical glitch but had deposited the collected TCS of said months in the electronic cash ledger.  The interest has been waived for the period starting from the date of depositing TCS in electronic cash ledger till the date of furnishing of Form GSTR-8.

 (Source: Notification No. 08/2022 –Central Tax dated 07.06.2022)

New Registrations to avoid bill traders (Tamil Nadu)

  • State Tax Department of Tamil Nadu has issued instructions for identification and prevention of bill traders through simplified registration process to curb tax evasion by way of fake invoices.
  • Any application for new registration filed has to undergo the process of matching with the database as to whether any of the following six parameters pertaining to cancelled registration found to have been matched with details provided in the application for new registration, to invariably undertake pre-verification of the business premises, by the jurisdictional proper officer as per the notification in the reference cited, so as to deter the bill traders from applying for new registration.

(i) Place of business,

(ii) PAN,

(iii) Mobile number,

(iv) e-mail ID,

(v) Authorized signatory and

(vi) Bank account number

  • The IT wing shall make available the above list to the proper officer of the base circle on a daily basis.

[Source: Notification No. 6/2022 dated 07.06.2022; Circular No. 10/2022 dated 07.06.2022  issued by Additional Chief Secretary / Commissioner of State Tax (PP2 /GST-15/20/2022)] 

Recent Updates In GST till 16th June 2022

Revocation of cancelled GST Registration on Court Orders (Karnataka)

  • Karnataka State Tax Department has notified a Module for revocation of cancelled GST registration beyond 90 days, which is allowed by the Appellate Authority or court.
  • While hitherto there was no electronic module in place to revoke such cancelled registration, with help the new Module, LGSTO’s/SGSTO’s can revoke cancelled GSTINs of the Tax payers who have not applied for Revocation beyond 90 days and preferred the appeal.
  • The path for revocation of cancellation at GST Pro is Registration Request> Approve Revocation Request> Revocation after Appeal/High Court Order. To enable the( revocation, the proper officer has to select the GSTIN and upload the pdf copy of the Appeal order or High Court order along with the Revocation Proceedings drawn to revoke the cancelled GSTIN.
  • All the actions have to be done with the Digital Signature Certificate of the Officer.

[Source: Circular No. 01/2022-23 dated 02.06.2022  issued by Commissioner of Commercial Taxes, Government of Karnataka]

Guidelines for Refund Claims in GST

  • CBIC (GST Policy Wing) has issued guidelines on the procedure relating to sanction, post audit and review of refund claims.
  • For the purpose of ensuring uniformity in procedure and enabling effective monitoring of sanction of refund claims in order to safeguard interest of revenue, Board has issued guidelines for sanction, post audit and review of refunds.
  • For sanction of refund :
  • While passing the refund sanction order in FORM GST RFD-06, the proper officer should also upload a detailed speaking order along with refund sanction order in FORM GST RFD-06. In order to ensure uniformity in issuance of such speaking order, CBIC has clarified that such speaking order should inter alia contain details as per guidelines.
  • Certain additional details will be required in case of the refund of accumulated ITC (on account of zero-rated supplies/ inverted rated structure) and refund of IGST paid on account of zero-rated supplies, deemed exports, refund of excess balance in cash ledger etc.
  • For post audit & review :
    • All refund orders are required to be reviewed for examination of legality and propriety of the refund order and for taking a view whether an appeal to the appellate authority under provisions of section 107(2) of the CGST Act is required to be filed against the said refund order.
    • Post-audit may henceforth be conducted only for refund claims amounting to Rs. 1 lakh or more till further instructions.
    • Till the time the functionality for conducting post-audit online is developed on ACES-GST portal, post-audit of refund orders may be conducted in offline mode.
  • The post-audit and review of the refund claims shall be conducted keeping in mind the following guidelines:

a) All the refund orders passed should be immediately transmitted online to the review  module after issuance of refund order in FORM GST RFD-06. The review and post- audit officers shall have access to all documents/ statements on ACES-GST portal  pertaining to the said refund claims.

b) For the  purpose  of post-audit  of refund  order,  a  Post-Audit  Cell  under  a  Deputy/Assistant Commissioner along with one/ two Superintendents and Inspectors  as required, may be created in Commissionerate Headquarters.

c) The post-audit should be concluded within 3 months from the date of issue of FORM  GST RFD-06 The findings of the post-audit shall be communicated to the review  branch within the said time period of 3 months.

d) The review of refund order shall be completed at least 30 days before the expiry of  the time period allowed for filing appeal under Section 107(2)of the CGST Act. 

(Source: Instruction No. 03/2022-GST dated 14.06.2022  issued by CBIC, GST Policy Wing)

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May 2024