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Non-filers of GST returns may face cancellation of registration

Non-filers of GST returns may face cancellation of registration

The Goods & Services Tax (GST) Administration plans to act tough with non-filers of returns and cancel their registration. It has also decided to update the progress made in this regard on a daily basis.

Filing of returns helps tax authorities to estimate the tax liability and find out how much tax has been paid. The problem here is that nearly 20 per cent of assessees do not file their returns, which affects GST collections.

The Central Board of Indirect Taxes & Customs (CBIC) held a meeting with the Principal Chief Commissioner and Commissioner of GST & Customs on November 13. According to sources, PK Dash, Chairman, CBIC, expressed his displeasure in the progress of cancellation of registration of non-filers who have not filed GSTR 3B (showing tax payments) returns for six or more than six return periods and are liable to action under GST law.

“…the task of cancellation of registration of such non-filers of GST returns should be taken on priority basis and should be furnished by November 25, ” a communication sent from the office of the Principal Chief Commissioner of GST & Central Excise, Mumbai to Principal Commissioner/Commissioner posted in its jurisdiction. It has also asked for reports to be sent on a daily basis.

Conditions for cancellation
Section 29 of the Central Goods & Services Tax (CGST) Act prescribes conditions for cancellation of registration and fulfilment of any of these will invite action. These include contravention of the provisions of the Act, a composition scheme assessee not filing returns for three consecutive tax periods, any non-composition assessee not furnished returns for a continuous period of six months, not commencing business within six month from the voluntary registration, and registration obtained by means of fraud, wilful misstatement or suppression of facts. The Act clearly provides that registration will not be cancelled without giving the person an opportunity of being heard.

According to GST Law, a registered person will have to file returns either monthly (normal supplier) or on a quarterly basis (supplier opting for composition scheme). An ISD (Input Service Distributor) will have to file monthly returns showing details of credit distributed during the particular month. A person required to deduct tax (TDS or Tax Deducted at Source) and persons required to collect tax (TCS or Tax Collected at Source) will also have to file monthly returns showing the amount deducted/collected and other specified details. A non-resident taxable person will also have to file returns for the period of activity undertaken.

The law is very clear here that the cancellation of registration will not affect the liability of the person to pay the tax and other dues. Every registered person whose registration is cancelled will pay an amount, by way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher.

Source: The-Hindu-Business-Line

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Delhi HC directs GST Department to Open Online Portal to file the Form TRAN-1 electronically, or to Accept Manually

Delhi HC directs GST Department to Open Online Portal to file the Form TRAN-1 electronically, or to Accept Manually

The Delhi High Court has directed Goods and Services Tax ( GST ) department to either open the online portal so as to enable the petitioner to file the Form TRAN-1 electronically or to accept the same manually on or before 20.11.2019.

The petitioner contended that, it is engaged in the business of trading of steel pipes and is registered under the Central Goods and Service Tax Act, 2017. Before the introduction of the GST Act, as on 30.06.2017, the petitioner had a closing stock of pipes purchased from M/s Avon Steel Industries Private Limited of Rs. 71,35,431/- inclusive of excise duty of Rs.7,92,826/-. Petitioner was entitled to the transition of credit of the amount of Excise duty in terms of Section 140 (iii) of the GST Act. In order to avail transition of credit, petitioner was required to submit a declaration in Form TRAN-1 on the GST Portal within the stipulated period of 90 days. Since a large number of taxpayers could not complete the process within the aforesaid period on account of technical glitches and difficulties faced by them, the government extended the time period for filing TRAN-1 several times and lastly on the recommendation of GST Council, it was extended up to 27.12. 2017.

The Petitioner also submitted that, Pursuant to the aforesaid extension, the petitioner filed Form TRAN-1 on the common portal before the deadline. However, it was unable to log in to the common portal between 24.12.2017 to 27.12.2017 and avail transition of credit, presumably because of low bandwidth, given the fact that a large number of assessees all over India were trying to submit the declaration in Form TRAN-1 before the last date i.e. on 27.12.2017. Petitioner has annexed the screenshot of the Form TRAN-1, available on the common portal along with the petition.

The division bench comprising of Justice Vipin Sanghi and Justice Sanjeev Narula has said that, “the factual position in the present case is not any different and thus, we allow the present petition and direct the respondents to either open the online portal so as to enable the petitioner to file the Form TRAN-1 electronically or to accept the same manually on or before 20.11.2019”.

The Court also directed to process the petitioner’s claim in accordance with law once the GST Form TRAN–1 is filed.

Source: TaxScan.

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No GST Registration Needed for Co-Owner in AoP until the Turnover Reached the Threshold Limit: AAR

No GST Registration Needed for Co-Owner in AoP until the Turnover Reached the Threshold Limit: AAR

The Authority of Advance Ruling in West Bengal has ruled that, GST Registration is not needed for Co-Owner in Association of Persons ( AoP ) until the turnover reached the Threshold limit under the GST Act, 2017.

The Applicant is one of the co-owners of immovable property, jointly owned by three individuals. All three co-owners, including the Applicant, hold an equal share in the property. The property is let out to CGST & CX, Chandannagar Division. Total rental received exceeds the threshold provided under section 22(1) of the GST Act, but the share of each of the three co-owners does not cross the said threshold.

The Applicant seeks a ruling on whether he and the other two co-owners are to be treated as an association of persons or a body of individuals and, therefore, a person as defined under section 2(84)(f) of the GST Act, who is required to be registered under section 22(1) of the Act.

The AAR observed that, “the Applicant and the other two co-owners cannot be treated as an association of persons and, therefore, as a person defined under section 2(84X0 of the GST Act, where their income from renting is separately ascertainable and assessed for income tax individually at the hand of each co-owner. Whether the Applicant is required to be registered under section 22(1) of the GST Act will, therefore, depend on his gross turnover, ascertained separately from the other co-owners, exceeding the threshold as provided under the Act”.

Source: TaxScan.

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GST taxpayers alert! CBIC is going to use this unique number from Friday, here’s how it will benefit you

GST taxpayers alert! CBIC is going to use this unique number from Friday, here’s how it will benefit you

In order to protect GST taxpayers from any harassment at the hands of errant tax officials, the Central Board of Excise and Customs (CBEC), is going to use a unique number in every communication with taxpayers from Friday. Initially, the department will use this unique document identification number (DIN) mostly for investigation related communications such as arrest warrants and search authorizations and it will be later expanded to cover all the communication issued by the officers of the board. All the communication issued on or after November 8 without a computer-generated document identification number will be invalid and deemed to have never been issued, said the CBIC in a letter issued to all the top officers on Tuesday.

The new document identification number to be used by the CBIC is similar to the one used by the CBDT since October 1 this year. GST taxpayers and recipients of summons, search warrants will be able to verify the genuineness of the document by visiting the CBIC’s website.

“The board in exercise of its powers under section 168(1) of the CGST Act, 2017 and Section 37B of the Central Excise Act, 1944 directs that no search authorization, summons, arrest memo, inspection notices and letters issued in the course of any inquiry shall be issued by any officer under the Board to a taxpayer or any other person, on or after the 8th day of November, 2019 without a computer generated Document Identification Number (DIN) being duly quoted prominently in the body of such communication,” said the CBIC in a letter issued on November 5, which was reviewed by the Financial Express Online.

The letter which was issued by the GST Investigation wing under the department of revenue, ministry of finance also made it clear that no communication issued on or after November 8 will be valid without a system-generated DIN number.

“The board also directs that any specified communication which does not bear the electronically generated DIN and is not covered by the exceptions mentioned in para 3 shall be treated as invalid and shall be deemed to have never been issued,” said the CBIC.

What is Document Identification Number (CBIC-DIN) in GST
1. In order to prevent the harassment of genuine taxpayers at the hands of tax officials, the government has decided to create a proper audit trail of all the communications issued by the Central Board of Indirect Taxes and Customs.

2. The 20 digit unique Document Identification Number (DIN or CBIC-DIN) will be computer generated and it will be prominently displayed in the body of the document issued by the officers under the board.

3. Only authorised officers will be entitled to generate CBIC-DIN from the utility developed by the Directorate of Data Management (DDM) hosted on the online portal of the CBIC.

4. Use of CBIC-DIN will be compulsory from November 8, 2019 and no communication without it will be valid.

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Source: Financial Express.
GST: Evasion, returns and revenue boosting measures to feature at officers’ meet Monday

GST: Evasion, returns and revenue boosting measures to feature at officers’ meet Monday

Tax officers from the states and the Centre will get together for a day-long meeting on Monday to discuss administrative, legal, revenue and implementation-related issues under the indirect tax regime.

This will mark a first of its kind interaction between central and state tax officers, delinked from the agenda of the Goods and Services Tax (GST) Council meeting. Usually, officer-level meetings have always taken place a day before the GST Council meetings, mainly to discuss measures outlined in the Council’s meeting agenda.

As slowing revenues under the GST have become a concern, officials from the states and the Centre will discuss measures for anti-evasion, revenue augmentation, compliance, returns filing and online system, officials said. The rates of goods and services will, however, not be discussed since those pertain to the GST Council, they said.

Officials said this meeting would be more broad-based, wherein states and the Centre would have a common platform to discuss measures to streamline and regularise many pending issues under the GST. The tax officials are expected to take up issues related to e-way bills, delay in filing returns, IT matters, pending legislative changes, and methods to ensure greater coordination between states and Centre under GST, they said.

“This method to have a common platform for discussion between states and Centre is being tried for the first time. The idea was not to club it with a GST Council meeting and have an open agenda meeting. This was felt necessary so as to develop a mechanism for similar discussions going ahead. The officer-level meetings before Council meetings, otherwise, have too many agenda items and not everything gets discussed in detail,” one of the officials said.

Apart from the administrative- and implementation-related issues, pending legal changes would also be discussed. Another official said many states have not followed up on the amendments in the Central GST (CGST) Act with changes in their respective State GST (SGST) Acts, so much so that in some places there is a time lag of six months. “Such issues need to be prioritised since they are creating a hurdle in proper implementation of GST and would be raised in the meeting,” the official said.

The plan to hold this meeting comes even though the Council last month constituted a committee of officials from states and the Centre for revenue augmentation and looking into wider range of reforms such as systemic changes in the GST, including checks and balances to prevent misuse, measures to improve voluntary compliance, improved compliance monitoring and anti-evasion measures. The committee, which was earlier supposed to submit its report within 15 days, has so far met only once and is now likely to be given an extension of 1-2 months, officials said.”The committee has a wide range of topics in its terms of reference, so it would take time,” an official said.

GST collections in October contracted by 5.29 per cent to Rs 95,380 crore from Rs 1,00,710 crore in the year-ago month, marking the third instance of a contraction since the July 2017 roll-out of the indirect tax regime.

Source: indian-Express

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No GST on Collecting Exam Fee from Students and Remitting same to that Particular University: AAR

No GST on Collecting Exam Fee from Students and Remitting same to that Particular University: AAR

The Authority of Advance Ruling ( AAR ) in Karnataka has ruled that, the activity of collecting exam fee (charged by any university Or institution) from students and remitting the same to that particular university or institution without any value addition to it is a service as a pure agent and hence the value is excluded from the taxable value of the applicant as per Rule 33 of the Central GST Rules / Karnataka GST Rules, hence exempted from Goods and Services Tax ( GST ).

The Applicant provides coaching, learning and training services in relation to under-graduate, graduate and post-graduate degree, diploma and professional courses on a standalone bases to students or for any institution, corporate, company, institutes, universities and colleges in the subject and branches of all types of disciplines such as commerce, hardware, software, computer, science, arts, business management, engineering, medical, industrial, pharmacy, mining, military, dance, acting, sports, journalism and any other ‘field of education and set up of coaching and training classes/ centers in relation to the same.

The AAR observed that, “The applicant is collecting the exact amount payable to institute or college or universities as exam fee from the students (service recipient) and remits the same amount to the respective institute or college or universities (third party) without any profit element or additions, on the authorization of the student. This payment is separately indicated in the invoice issued to the respective students. The applicant providing this kind of services to the student in ‘addition to the services as training and coaching institute. Hence the applicant satisfies all the conditions of the pure agent as narrated in Rule 33 of the COST Rules, 2017. Therefore, amount of the fee collected by the applicant from the student as exam fee which is remitted to the respective institute or college or universities is excluded from the value of supply”.

Source: Taxscan

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Punjab and Haryana HC directs GST Department to Re-Open Facility to File or Revise Tran-1 either Electronically or Manually

Punjab and Haryana HC directs GST Department to Re-Open Facility to File or Revise Tran-1 either Electronically or Manually

The Punjab and Haryana High Court has directed Goods and Services ( GST ) department to file or revise Tran-1 either electronically or manually.

The High Court was hearing a bunch of Petitions, which Petitioners are registered under Central/State Goods and Services Tax Act, 2017 and seeking direction under Article 226 of Constitution of India to Respondents to permit carry forward of unutilized CENVAT credit of duty paid under Central Excise Act, 1944 and Input Tax Credit of VAT paid under PVAT Act, 2005 or HVAT Act, 2003 which could not be carry forwarded on account of non-filing or incorrect filing of prescribed statutory Form i.e. TRAN-1 by the stipulated last date i.e. 27.12.2017.

The division bench comprising of Justice Jaswant Singh and Justice Lalit Batra directed to permit the writ applicants to allow filing of declaration in form GST TRAN-1 and GST TRAN-2 so as to enable them to claim transitional credit of the eligible duties in respect of the inputs held in stock on the appointed day in terms of Section 140(3) of the Act.

The Court also ruled that, “the due date contemplated under Rule 117 of the CGST Rules for the purposes of claiming transitional credit is procedural in nature and thus should not be construed as a mandatory provision”.

While concluding the Judgment, the Court also directed Respondents to permit the Petitioners to file or revise where already filed incorrect TRAN-1 either electronically or manually statutory Form(s) TRAN-1 on or before 30th November 2019.

“The Respondents are at liberty to verify the genuineness of claim of Petitioners but nobody shall be denied to carry forward the legitimate claim of CENVAT / ITC on the ground of non-filing of TRAN-I by 27.12.2017”, the Court also added.

Source: Taxscan.

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GST collections remain subdued at Rs 95,380 crore in October

GST collections remain subdued at Rs 95,380 crore in October

The Goods and Services Tax (GST) collection in October declined to Rs 95,380 crore, as against Rs 1,00,710 crore in the same month a year ago, as per government data released on Friday.

This is the third consecutive month when GST mop-up remained below the Rs 1 lakh crore mark, despite October being a festive month.

The revenue collection in September stood at Rs 91,916 crore.

“The gross GST revenue collected in the month of October, 2019 is Rs 95,380 crore of which CGST is Rs 17,582 crore, SGST is Rs 23,674 crore, IGST is Rs 46,517 crore (including Rs 21,446 crore collected on imports) and Cess is Rs 7,607 crore (including Rs 774 crore collected on imports),” the finance ministry said in a statement.

It further said the total number of GSTR 3B returns (summary of self-assessed return) filed for the month of September (up to October 30) was 73.83 lakh.

Source: Times-Of-India.

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Central GST busts fake invoice racket worth R14cr

Central GST busts fake invoice racket worth R14cr

A fake Goods and Services Tax (GST) invoice scam of Rs 14 crore was unearthed by the Central GST commisionerate where the suspects used it for fraudulently claiming input tax credit (ITC).

The scam came to surface during the course of action by the squads of the Central GST where a Chandwad-based firm M/s Gonglu Agro Pvt Ltd had received fake GST invoices worth Rs 5.58 crore.

Later, the Central GST commisionerate found that this firm was also involved in issuance of fake GST invoices. “During investigation we found that this Chandwad-based firm was involved in issuance of fake GST invoices. The firm has issued fake GST invoices of around Rs 70 crore to facilitate passing on bogus ITC of Rs 8.4 crore,” an official from the Central GST department said.

The Central GST department has arrested the managing director of the company, Rahoul Jain, and is investigating the case to find whether other firms are also involved in such practices of providing fake GST invoice to facilitate bogus claims of the ITC.

The Nashik divisional office of the Central GST (erstwhile office of Central excise, service tax and customs) has jurisdiction across five districts — Nashik, Ahmednagar, Dhule, Jalgaon and Nandurbar.
There are over 1.10 lakh businesses registered in the district of which 60,000 businesses are registered with the Nashik divisional office of the state GST, while remaining 53,591 are registered with the divisional office of the Central GST.

The new tax regime GST came into effect from July 1, 2017 replacing the multiple indirect taxes and traders with turnover of below Rs 20 lakh were exempted from GST, while those with annual business turnover up to Rs 1 crore are eligible for composition scheme.

The GST council made several changes in the past following introduction of GST and the exemption limit had was increased from Rs 20 lakh to Rs 40 lakh and only those businesses with turnover of above Rs 40 lakh are under the tax net.

Source: Times-Of-India.

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Now, officers to exclusively handle GST, Customs complaints

Now, officers to exclusively handle GST, Customs complaints

In line with Prime Minister Narendra Modi’s assurance that honest taxpayers would not be harassed and wealth creators would be respected, the indirect tax body – Central Board of Indirect Taxes and Customs (CBIC) has directed to appoint a nodal officer in each CGST and Customs Commissionerate to sort out taxpayer grievances.

Industry and tax experts have hailed the decision saying that the move would ensure an escalation point for taxpayers in case their grievances are not addressed at designated level.

“In order to institutionalize the taxpayers’ services in the field formations, it is necessary to designate officers who are to act as the nodal officers assigned with the job of taxpayer service,” CBIC Chairman P. K. Das has written to senior officers.

Accordingly, each CGST and Customs Commissionerate would have a nodal officer in the rank of Joint/Additional Commissioner. These officers would draw up plans for reaching out to the stakeholders in their jurisdictions.

“The Directorate of Taxpayer Service would regularly monitor the work done by the nodal officers who would be extended arm of the CBIC for rendering taxpayer services.

“Any move which identifies a certain person as someone who could act as central point for escalation of cases is good move. It is a good move but one has to see how effective it is. In order to ensure that it works, a transparent monitoring mechanism has to be there,” said Amit Bhagat, Partner, Dhruva Advisors.

The CBIC Chief in his letter to senior field officers noted that PM Modi had emphasized the urgent need to prioritize taxpayer service.

He noted that taxpayers committing minor or procedural violations should not be subjected to disproportionate or excessive action and that wealth creators are respected.

Rajat Mohan, Senior Partner, AMRG & Associates said that taxpayers presently have to chase various officers for resolving issues and hence the move to appoint a nodal officer would be a big relief.

Source: Economic-Times.

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