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News Indirect Tax-GST

  • Sep 22, 2021
  • GST panel to consider giving waiver on 1 day interest, late fee

    As some taxpayers faced difficulties in filing GST return on Monday, the tax department on Tuesday said the IT grievance redressal committee would consider giving interest and late fee waiver. The Central Board of Indirect Taxes and Customs (CBIC) in a tweet said a few taxpayers have reportedly faced difficulty in updation of Electronic Cash Ledger on September 20.

    September 20 was the last day for filing GST returns and paying taxes via GSTR-3B for August.

    "To mitigate their difficulties, GSTN has been directed to take up the issue of waiver of late fee and interest for one day for such taxpayers, before the IT Grievance Redressal Committee," the tweet said.

  • Sep 21, 2021
  • Big relief for BPO industry: Outsourced services won’t attract 18% GST, clarifies govt

    In a big relief for India's $180 billion back-office sector, the government has clarified that services outsourced to India or carried out in the country for foreign entities will not be treated as intermediary services, and hence not face 18% goods and services tax (GST). This was approved by the GST Council on Friday, the Economic Times mentioned in a report.

    The clarification issued by the government will free up hundreds of crores in tax refunds to entities in the information technology (IT), IT-enabled services (ITeS), financial services, and research and development sectors as well as resolve the four-year-old issue that has led to large-scale litigation.

    Worth mentioning here is that tax authorities had begun treating back-office services providers, or business process outsourcing (BPO) entities, as intermediaries, denying export status to their services to overseas entities. Exports are zero-rated under GST and not liable to the tax while intermediaries face an 18% charge.

  • Sep 20, 2021
  • Come Jan 1, non-filers of 1 monthly GST return to be barred from filing GSTR-1

    Businesses that default on filing summary return and paying monthly GST will not be able to file GSTR-1 sales return of the succeeding month from January 1 next year.

    The GST Council in its Lucknow meeting on September 17 has decided to take a host of measures to streamline compliance, including mandatory Aadhaar authentication for businesses to file refund claims.

  • Sep 18, 2021
  • GST Council not for inclusion of petroleum products: Finance Minister

    The Goods and Services Tax (GST) Council has decided to keep petroleum products out of the GST regime, while consumers will have to keep paying the Compensation Cess levied on products like automobiles till March 2026 instead of July 2022 as originally envisaged at the time of rolling out the indirect tax regime.

    Union Finance and Corporate Affairs Minister Nirmala Sitharaman, who chaired the first physical meeting of the Council in nearly two years, said a discussion on including petroleum products in the GST regime was held purely at the behest of the Kerala High Court, which had suggested that the Council take it up in response to a writ petition.

  • Sep 18, 2021
  • GST Council extends concessions on certain Covid drugs till Dec 31: FM

    The all-powerful GST Council on Friday decided to charge food delivery platforms such as Swiggy and Zomato a tax even as it extended concessional tax rates on certain COVID-19 drugs by three months till December 31.

    The Council, which comprises the Union finance minister and her state counterparts, decided to continue keeping petrol and diesel out of the GST purview as subsuming the current excise duty and VAT into one national rate would impact revenues.

    Briefing reporters on the decisions taken by the Council at a meeting here, Union Finance Minister Nirmala Sitharaman said GST has been exempted on muscular atrophy drugs like Zolgensma and Viltepso, which cost crores of rupees.

    It extended the period of concessional GST rates on certain COVID-related drugs by three months till December 31 but decided not to give the same benefit to medical equipment.

  • Sep 18, 2021
  • On demand fetching of Bill of Entry details from ICEGATE Portal

    To help importers of goods, and recipients of supplies from SEZ, search Bill of Entry details, which did not auto-populate in GSTR-2A, a self-service functionality has been made available on the GST Portal that can be used to search such records in GST System, and fetch the missing records from ICEGATE.
    Please note that it usually takes 2 days (after reference date) for BE details to get updated on GST Portal from ICEGATE. This functionality should, therefore, be used if data is not available after this period.
    Note: The reference date would be either Out of charge date, Duty payment date, or amendment date - whichever is later.
    Taxpayers can follow the below steps to fetch the requisite details:
    Login to GST Portal
    Navigate to Services > User Services > Search BoE
    Enter the Port Code, Bill of Entry Number, Bill of Entry Date and Reference Date and click the SEARCH button.

  • Sep 17, 2021
  • Summoned by GST authorities? Know your duties and rights

    With passage of time the complexities of GST have only increased and so has the aggression of the tax authorities to recover taxes from the taxpayers. Lately, many companies, their employees and key managerial persons have been receiving summons for some or the other matter. Under GST law, section 70 of the CGST Act, 2017 empowers the GST officers to summon any person to appear before them, if the same is necessary in the course of an inquiry to record statements or produce any documents. Such persons summoned by the GST officers are duty bound to appear before the officers. It is worth noting that the summons and information gathered thereafter is the first step towards proceedings under GST law. Therefore, it becomes imperative for the taxpayers to know how to deal with such summons and be aware of their rights and duties.

  • Sep 16, 2021
  • Govt may waive GST in border mkt

    The Union government is considering waiving off goods and services tax (GST) on products sold at the marketplace on the zero line of the Indo-Bangladesh border to further strengthen the economic ties between the two countries as Bangladesh has surpassed Hong Kong to become India’s fourth-biggest export destination, said people aware of the development.

    For a formal approval, the matter will be placed in the 45th meeting of the GST Council in Lucknow on September 17, two people aware of the matter said, requesting anonymity.

    “The move is reciprocal as Bangladesh does not impose any tax on the border ‘haat’ (market) limited to about four dozen vendors, catering to local needs in that remote area. Besides, it has no significant revenue implications,” said one person, who works in an economic ministry.

    At present, there are four operational ‘haats’ along the India-Bangladesh border. Two of them are located in Meghalaya and two are located in Tripura.

  • Sep 15, 2021
  • Swiggy, Zomato, cloud kitchens may be brought under GST ambit

    Food delivery apps like Swiggy and Zomato may soon be brought under the ambit of restaurant services, which will make them liable to pay the Goods and Services Tax (GST). The GST Council will consider this in a meeting on Friday.

    The fitment panel has recommended that e-commerce operators that provide restaurant services on their apps or websites must be notified as ‘e-commerce aggregators’ in the same category as restaurant services, making them suppliers and thus, liable to pay GST. Presently, restaurants 5 per cent GST (without input tax credit) on delivery of food items and non-alcoholic beverages. Food aggregators are registered as tax collectors at source.
    If this proposal goes through, GST for food delivery apps will be brought to the same level as restaurants. It stated that the level of tax evasion in India went up with a rise in food delivery, especially from unregistered entities.

    Many restaurants are not paying GST and some small eateries are not even registered. Therefore, the panel suggested making the restaurants pay on behalf of the eateries. The panel estimated GST losses of nearly Rs 2,000 crore in FY20 and FY21even though food delivery skyrocketed during the pandemic. “There are no mandatory registration checks by Swiggy or Zomato and there are unregistered restaurants supplying through these food delivery portals,” a government official told Business

  • Sep 15, 2021
  • GST Council may consider bringing petrol, diesel under GST on Sept 17

    The GST Council might on Friday consider taxing petrol, diesel and other petroleum products under the single national GST regime, a move that may require huge compromises by both central and state governments on the revenues they collect from taxing these products.

    The Council, which comprises central and state finance ministers, in its meeting scheduled in Lucknow on Friday, is also likely to consider extending the time for duty relief on COVID-19 essentials, according to sources in the know of the development.
    GST is being thought to be a solution for the problem of near-record high petrol and diesel rates in the country, as it would end the cascading effect of tax on tax (state VAT being levied not just on the cost of production but also on the excise duty charged by the Centre on such output).

    In June, the Kerala High Court, based on a writ petition, had asked the GST Council to decide on bringing petrol and diesel within the goods and services tax (GST) ambit.

    The sources said bringing petrol and diesel within GST would be placed before the Council for discussion in the light of the court asking the Council to do so. When a national GST subsumed central taxes such as excise duty and state levies like VAT on July 1, 2017, five petroleum goods – petrol, diesel, ATF, natural gas and crude oil – were kept out of its purview for the time being.

    This is because both central and state government finances relied heavily on taxes on these products.
    Since GST is a consumption-based tax, bringing petro products under the regime would have mean states where these products are sold get the revenue and not ones that currently derive the most benefit out of them because of they being the production centre.

    Simply put, Uttar Pradesh and Bihar with their huge population and a resultant high consumption would get more revenues at the cost of states like Gujarat.

  • Sep 14, 2021
  • Supreme Court: Inverted duty refund not admissible for input services

    Referring to the anomalies pointed out by assessees in computation of input tax credit in value chains involving inverted tax structures, the Supreme Court on Monday urged the Goods and Service Tax (GST) Council to reconsider the relevant formula and take a policy decision on the matter.

    However, the SC upheld the Madras HC judgement in favour of Central GST (CGST) rules that inverted duty refund is admissible only with respect to inputs for goods and not for input services. The top court also set aside the Gujarat HC judgement which declared that Rule 89(5) of CGST Rules as ultra vires Section 54(3), for restricting the refund only to input goods.

    The GST Council, which will meet on September 17, will likely discuss the inverted duty structure. Inverted duty structure arises in products such as footwear and ready made garments due to higher taxes on input and lower rates on final products.

  • Sep 13, 2021
  • SC asks GST Council to look into anomalies related to refund assessment formula

    The Supreme Court (SC) has asked the Goods and Services Tax (GST) Council to take note of anomalies in the present act and look into the assessment formula for claiming refunds.

    While pronouncing its judgement, the SC said, “Provisions of Article 246a are available to both parliament and state. Article 246a embodies the constitutional principle of simultaneous levy.”

    “Cannot expand the regime beyond what the legislature has provided. Anomalies in the law is a matter of legislative policy. GST council should take note of the anomalies,” the court added.

    The case is primarily related to claims of GST refunds and unutilised input tax credit (ITC). Citing the law under the GST Act, the court said refund of the input tax credit will be in specific conditions.

    The court said that the legislature has made the distinction for claims of refunds clear and added: “With reference to exports, the ITC on input goods and input services brought in the fold of the Act in contrast with domestic supplies.”

  • Sep 09, 2021
  • GST authorities send out more notices, industries claim harassment

    Industries have raised red flags over fresh notices being issued denying input tax credit (ITC), alleging wrongful claims, in turn leading to hardships for businesses.
    According to sources, the Directorate General of GST Intelligence has been issuing these notices over the past month and now industries have escalated the matter to North Block.
    “Companies in sectors like steel, steel scrap, real estate, IT, e-commerce, etc, are getting such notices very often and are the worst affected sectors,” sources told CNBCTV18.
    Companies have submitted a detailed representation to GST authorities and the Central Board of Indirect Taxes and Customs (CBIC) to avoid hardships.
    As per the industry representation complaints, reviewed by CNBCTV18, some of the technical issues include notices containing denial of input tax credit on comparison of GSTR 3B with GSTR 2A, seeking GSTR2A for FY18, when the facility had not even started.

  • Sep 09, 2021
  • Gujarat AAR rules parathas are not ready-to-eat, puts them under 18% GST

    The controversy over the goods and services tax (GST) rate on food products refuses to die. Now, the Gujarat-based authority of advance rulings (AAR) has ruled that 'parathas' would attract 18 per cent GST.

    The applicant, Vadilal Industries, sought to know whether various kinds of 'parathas' supplied by them would attract five per cent GST in line with 'khakhra', plain chapati or 'roti'. To buttress its contention, the company gave definition of the word 'paratha' from various English dictionaries and Wikipedia, as it is not defined in the GST laws and rules under them.

    For instance it said in Merriam Webster Dictionary, Paratha is described as 'An unleavened Indian wheat bread that is usually fried on a griddle.'

    The authority, however, said 'khakhra', plain chapati or 'roti' are cooked preparations and do not require any processing for human consumption and hence are ready-to-eat food preparations. On the other hand, 'paratha' supplied by the company is not only different from them but also requires further processing for human consumption.

  • Sep 02, 2021
  • GST Council to meet on Sept 17, to review rate on Covid essentials

    The GST Council will meet on September 17 in Lucknow which among other things may review concessional rates on Covid essentials.

    "Finance Minister Smt @nsitharaman will chair the 45th meeting of the GST COUNCIL on 17th September at Lucknow, the Finance Ministry tweeted.

    The previous Council meeting was held via videoconferencing on June 12 during which tax rates on various Covid essentials were reduced till September 30.

    Goods and Services Tax rates were slashed on Covid drugs such as Remdesivir and Tocilizumab as well as on medical oxygen, and oxygen concentrators other Covid essentials.

    The meeting on September 17 could discuss compensation to states for loss of revenue, review of rates on Covid essentials, and inverted duty on certain goods.

  • Aug 31, 2021
  • GST amnesty scheme: Government extends last date of late fee amnesty scheme till November 30- Details here

    The Ministry of Finance on Sunday, August 29 extended the last date to avail the GST amnesty scheme, under which taxpayers have to pay a reduced fee for delayed filing of monthly returns, by three months till November 30.

    "The Government, vide Notification No. 19/2021- Central Tax, dated 01.06.2021, had provided relief to the taxpayers by reducing / waiving late fee for non-furnishing FORM GSTR-3B for the tax periods from July, 2017 to April, 2021, if the returns for these tax periods are furnished between 01.06.2021 to 31.08.2021," the Ministry said in a statement.

  • Aug 28, 2021
  • Come Sep 1, non-filers of 2 monthly GST returns to be barred from filing GSTR-1

    Businesses that have not filed GSTR-3B returns in the preceding two months will not be able to file details of outward supplies in GSTR-1 from September 1, GSTN has said.

    While businesses file GSTR-1 of a particular month by the 11th day of the subsequent month, GSTR-3B, through which businesses pay taxes, is filed in a staggered manner between 20th-24th day of the succeeding month.
    In an advisory to taxpayers, GSTN, which manages the technology backbone for Goods and Services Tax, said that Rule-59(6) of Central GST Rules which provides for restriction in filing of GSTR-1, will come into effect from September 1, 2021.

    According to the rule, a registered person shall not be allowed to furnish the details of outward supplies of goods or services or both in Form GSTR-1, if he has not furnished the return in Form GSTR-3B for preceding two months.
    For taxpayers filing quarterly return, GSTR-1 filing would be restricted if he has not furnished the return in Form GSTR-3B for preceding tax period.

  • Aug 27, 2021
  • Open to idea of reducing GST rates on vehicles, says Revenue Secretary

    After several requests from vehicle manufacturers in India, the Centre has hinted that it is ready for negotiations to reduce GST rates on cars and two-wheelers. During a conference on Wednesday, revenue secretary Tarun Bajaj said he is ready to discuss the matter further with industry leaders.

    "I would be very happy to engage with you to see what we can do even on (GST) tax rates, what is the tinkering we can do to see to it that certain (vehicle) segments get the encouragement they deserve," Bajaj said during a conference organised by auto industry body SIAM on Wednesday.

  • Aug 25, 2021
  • Papads don’t attract GST, but fryums face 18% rate

    No Gujarati thali is complete without a papad, be it fried or roasted. Fortunately for consumers, as the GST burden is ultimately borne by them, the Gujarat bench of the Authority for Advance Ruling (AAR) has held that Papads will attract nil GST.
    Interestingly, the AAR bench observed that Papads were handmade once. Hence, it was easier to roll them into a round shape. Today, with the advancement of technology, the old traditional round papad has given way to different shapes and sizes.
    But — as long as the goods are similar in respect of the ingredients, manufacturing process and use — it will be a papad classified at HSN 19059040. Currently, the GST rate against this classification is nil.
    The manufacturer, Global Gruh Udyog, which produced puri papad and unfried papad (in such varieties as jeera, red chilli, green chilli, rice & mung dal) sought a ruling on the classification for its products.