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GSTN issues Advisory on Tracking GST Refund Application Status on GST Portal and PFMS portal

GSTN issues Advisory on Tracking GST Refund Application Status on GST Portal and PFMS portal

The functionality of tracking the status of the refund application has been available on the GST portal. By utilizing this functionality, the taxpayers can know the stage at which the refund application is pending with the tax-officer/ taxpayer.

A tax officer can issue payment orders only after the Public Financial Management System (PFMS) has validated the bank account mentioned in the refund application (RFD-01). Similarly, the final disbursement of the refund amount sanctioned by the tax officer happens only after (PFMS) has validated the bank account mentioned in the payment order (RFD-05). Thus, validation of the bank account takes place at two stages. However, the exact detailed status of bank account validation is not available on the GST Portal.

The Public Financial Management System (PFMS) of the Controller General of Accounts (CGA) has made available a central portal to track the status of bank account validation and disbursal of refund amount. By visiting the PFMS portal the taxpayer can track the status of bank account validation.

This advisory is being issued for the benefit of the taxpayers in order to make them aware of the ways in which they can track the status of their refund applications on both the Portals.

for the detailed info https://tutorial.gst.gov.in/downloads/news/Advisory%20on%20Refund%20Tracking.pdf

Source: TaxScan.

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GST collection slips below Rs 1 trillion in March after four months

GST collection slips below Rs 1 trillion in March after four months

Goods and services tax (GST) collection fell below the Rs 1-trillion mark in March after a gap of four months, even as disruptions caused by the coronavirus-induced lockdown will get captured only in the coming months.
The numbers pertain to GST paid in February but collected in March, suggesting that collections might turn grimmer going forward.

The GST mop-up in March stood at Rs 97,597 crore, down 8.4 per cent on a year-on-year basis, the data released by the Ministry of Finance showed on Wednesday. The government had targeted a collection of Rs 1.25 trillion in March. GST collection grew by a meagre 3.7 per cent in the full fiscal year 2019-20.

The dismal collection in March is despite the stringent anti-evasion measures introduced by the government, including the blockage of e-way bill and restricting input tax credit to 10 per cent in the case of failure of invoice uploads by suppliers.

Already hit by an economic slowdown, the country went into a 21-day lockdown from March 24 to prevent the spread of Covid-19. All industries that were struggling have become non-operational, which will reflect in the April GST collection figures.

Kerala Finance Minister Thomas Isaac told Business Standard that the April numbers, which would essentially be transactions in March would only be about 15-20 per cent of the March figures.

Pratik Jain, partner, India, said, “It seems that many businesses may not have been able to pay GST because of liquidity issues being faced after the lockdown. As the second half of March 2020 has been significantly impacted due to the Covid-19 outbreak, collections in April are likely to be substantially lower.”

In a major relief for businesses facing lockdown due to coronavirus, the last date for GST return filing for March, April and May 2020 has been extended to June 30, with no interest, late fee and penalty, for companies with up to Rs 5 crore turnover and subsidised interest of 9 per cent, and no penalty or late fees for bigger companies.

M S Mani, partner, India, said it was necessary for businesses to conserve cash in order to enable resumption of operations once the lockdown ends. Hence, any deferral of the GST payment timelines by a few months would significantly assist them in this process, Mani said.

Central GST collection for FY20 at Rs 4.95 trillion fell Rs 18,188 crore short of revised estimates for the fiscal year. The finance ministry, in Union Budget 2020-21, had lowered the CGST collection target for FY20 to Rs 5.13 trillion from Rs 5.26 trillion estimated in July.

Of the Rs 97,597-crore revenue in March, the central GST collection stood at Rs 19,183 crore, state GST at Rs 25,601 crore and integrated GST at Rs 44,508 crore, which included Rs 18,056 crore collected on imports, the finance ministry said in a statement.

GST collection on domestic transactions witnessed an 8 per cent decline, while GST collection on imports posted a negative growth of (-)23 per cent, indicating the beginning of Covid-related supply and demand disruption.

In order to plug revenue leakages, the Council allowed blocking of input tax credit in the case of fraudulent invoices and blocking of e-way bills in the case of non-filing of returns for three straight months.

The Council in its meeting on March 14 deferred the new simplified returns and e-invoicing till October, which was to be launched from April 1. Meanwhile, in order to improve collections, the government is aiming to correct inverted duty structure. It raised the GST on mobile phones to 18 per cent from 12 per cent, bringing the rate on a par with the inputs.

Lower-than-expected revenues are also putting pressure on the Centre to compensate states for the revenue shortfall. The compensation cess collection stood at Rs 8,306 crore during the month, much smaller than the approximately Rs 14,000-15,000 crore compensation required by states on a monthly basis. States are up in arms with the Centre over a delay in payment of compensation dues and are planning to drag Centre to the Supreme Court.

Source: The-Business-Standard.

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Centre to extend IGST, compensation cess exemptions under export schemes till March 2021

Centre to extend IGST, compensation cess exemptions under export schemes till March 2021

Offering some relief to exporters struggling to cope with the effects of the lockdown, the Centre has decided to extend the IGST (Integrated Goods and Service Tax) and compensation cess exemptions for goods procurement under two popular export promotion schemes by a year, till March 31, 2021.

The Export Credit Guarantee Corporation of India (ECGC), the government-owned company providing insurance cover to exporters, is also adopting measures to aid exporters such as extending the time limit for returns, extension requests, default notifications and filing claims, apart from reducing fees, a government official told BusinessLine.

“We understand that exporters are not in a position right now to adhere to timelines or pay additional taxes. The Centre is trying to give them as much policy flexibility as possible to ease the pains of the lockdown,” the official said.
Exporters have been hit hard this month with the pandemic disrupting their production, shipments, orders and payments.

Following the Centre’s latest decision, exemptions on payment of IGST and compensation cess for goods procurement under the Export Promotion Capital Goods (EPCG) scheme and Advance Authorisation scheme have been extended by a year to March 31, 2021.

Extended deadline

Also, the ECGC has extended the deadline for all returns, extension requests and default notifications till May 31, 2020, as per a communication from the insurance company to stakeholders. The time for filing claim, reply to claim queries and representations has been extended to June 30, 2020. The specific shipment policy expiring in March 2020 has also been extended to June 30, 2020.

Moreover, the ECGC has reduced by 50 per cent its policy proposal fee for policies due to be renewed or issued between March 1 and June 30, 2020.

Discretion has also been extended to exporters, within RBI guidelines, to extend the due date for payment by buyers for shipments accepted earlier and to decide about the release, re-import or abandonment of shipments that reached their destination but have not been cleared by overseas buyers, said the note.

Source: The-Hindu-Business-Line

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12% GST applicable on Printing and Supply of Textbooks to Government Departments: AAR

12% GST applicable on Printing and Supply of Textbooks to Government Departments: AAR

The Authority of Advance Ruling (AAR) held that 12% of Goods and Service Tax (GST) is applicable to printing and supply of textbooks to government departments which are registered under Goods and Service Tax (GST) Acts, 2017.

The applicant, M/s Department of Printing, Stationery and Publication are a Government Press under the control and supervision of the Primary and Secondary Education Secretariat to cater to the Printing and Stationery requirements of the State Government offices namely Governor’s Office, Legislature, Government Secretariat, High Court, and Other Government Departments.

The applicant approached the Advance Ruling Authority on three grounds, namely, (i) whether GST exemption is granted to the activity of printing & supply of textbooks & printed materials, provided by the applicant to various Departments of Government of Karnataka? (ii) Whether the textbooks supplied to public or recognized bookstalls eligible for exemption?  and, (iii) the rate of tax applicable to these services if they are subject to taxation.

The Authority of Advance Ruling (AAR) consisting of Additional Commissioner of Commercial Tax, Dr. Ravi Prasad and Joint Commissioner of Central Tax, Mashood ur Rehman Farooqi held that these services are not eligible for GST exemption and 12% of Goods and Service Tax (GST) is applicable on the activity of printing and supply of textbooks to government departments which are registered under Goods and Service Tax (GST) Act.

However, the authority clarified that in the case of the printing and supply of textbooks to government departments that are not registered under the Goods and Service Tax (GST) Act, the applicant is exempted from the liability to pay tax.

Source: TaxScan.

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GST: Government Clarifies On Utilisation Of Tax Credit For M&A

GST: Government Clarifies On Utilisation Of Tax Credit For M&A

Entities undergoing business reorganisation via merger, demerger, amalgamation, change in ownership and transfer of assets have now been given clarity on utilisation of input tax credit.

Input tax credit is the tax paid on inputs. Businesses get a credit for this to deduct from the tax on the output so as to avoid double taxation and pay tax only on the value added.

Apportionment of input tax credit must be on the basis of state-wise assets in demerger schemes, the government has clarified.

Section 18 of the Central Goods and Services Tax Act allows transfer or apportionment of accumulated and unutilised input tax credit between entities undergoing business reorganizations. While the Act lays down the method, it is silent on certain practical aspects of such transfer. The circular aims to clarify on such issues.

Demergers: Apportionment of Tax Credit

The CGST Rules say tax credit can be transferred or apportioned to a demerged entity based on the ratio of value of transferred assets. However, the rules do not specify whether the value of the assets must be considered on a state-wise or countrywide basis.

It’s now been clarified that tax credit must be apportioned to the demerged entity on the basis of state-wise value of assets. That’s because GST requires state-wise registration of business entities.

Experts welcomed the clarification. The circular merely clarifies the position which the industry has been following at a practical level, Rajat Bose, partner in Shardul Amarchand Mangaldas & Co., said.

The clarification rightly recognises the distinct person concept under GST and clarifies prevailing doubts, especially for those businesses who have pan-India operations, Deloitte’s senior director Saloni Roy said. “An in-depth state-wise calculation will require extensive planning.”

The circular, however, misses out on certain critical aspects, Bose pointed out.
Some practical aspects still need clarity—for instance, eligibility to claim input credit by the transferor company on services used for business re-organization. A registered business may utilise legal, consulting and accounting services for transfer of business during business reorganizations. The GST department may not treat them as business expenses as it may not consider them to be as sale of “goods”. Any input tax credit availed for such expenses may be disallowed by the department, Bose pointed out.

Similarly, another area that needs clarity is treatment of common input services like lease or rental expenses. Bose explained this by way of an illustration.
Company ‘X’ with a turnover of Rs 1,000 crore hives off one of its units to Y for Rs 200 crore. This Rs 200 crore will be considered an exempt supply and no GST on it will be applicable. Any expense—rentals, electricity—that X may have incurred towards this unit, it would’ve availed tax credit for it. Once the unit is sold, the department could take a position that since Rs 200 crore is an exempt supply, tax credit availed for this unit needs to be reversed as well.
The treatment of such input tax credit in hands of X requires clarification, Bose explained.

Besides demergers, the clarification will be applicable to other forms of business restructurings, Roy pointed out.

Electronic filing for transfer of such input tax credit must be done only in states where the transferor and transferee companies are registered, the notification has clarified.

Source: bloomberg quint

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CBIC clarifies on issues under GST Law for Companies under IBC

CBIC clarifies on issues under GST Law for Companies under IBC

The Central Board of Indirect Taxes and Customs ( CBIC ) has issued clarifications in respect of issues under GST law for companies under the Insolvency and Bankruptcy Code, 2016 (IBC) in connection with the notification issued on  Saturday.

As per the Code, no coercive action can be taken against the corporate debtor for dues of the period prior to insolvency commencement date and such dues shall be treated as ‘operational debt’ for which claims may be filed by the PO before the NCLT in accordance with the provisions of IBC.

“The tax officers shall seek the details of supplies made/received and total tax dues pending from the corporate debtor to file the claim before the NCLT. Moreover, section 14 of the IBC mandates the imposition of a moratorium period, wherein the institution of suits or continuation of pending suits or proceedings against the corporate debtor is prohibited,” the CBIC Circular said.

Regarding the cancellation of GST registration of corporate debtor, the circular clarified that registration of an entity for which CIRP has been initiated should not be cancelled. However, the Proper Officer may suspend the registration. In case of cancellation of registration of an entity undergoing CIRP within the permitted time, the Circular advises that appropriate steps should be taken.

According to the circular, IRP/RP are not bound to file returns for the pre-CIRP period as the Code does not impose an obligation on them to comply with all legal requirements for period after the Insolvency Commencement Date.

For the purpose of the notification issued on Saturday, the corporate debtor who is undergoing CIRP is to be treated as a distinct person of the corporate debtor and shall be liable to take a new registration in the appropriate State/UT, the circular said.

“Further, IRP/RP appointed prior to the said notification shall take GST registration within thirty days of issuance of the said notification, with effect from date of his appointment as IRP/RP,” it added.

As specified in the Notification, it is mandatory for the IRP/RP to file returns under section 40 of the GST Act for the period it takes registration till the date on which registration has been granted.

With regard to the procedure for availing input tax credit for invoices issued to registered persons where IRP/RP has been appointed before issuance of NN 11/2020, the circular further clarified that the exception to the procedure stated under R. 36(4) as has been provided under Notification No. 11/2020 C.T. dated 21.03.2020 shall apply only for filing the first return. 

It was further clarified that the claim of refund of deposit in the cash ledger deposited by IRP/RP of erstwhile registration of the corporate debtor from the date of notification specifying the special procedure for corporate debtors undergoing CIRP, shall be available for refund to the erstwhile registration under the head refund of cash ledger, even though the relevant FORM GSTR-3B/GSTR-1 is not filed for the said period.

Source: TaxScan.

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GST filing deferment no relief for mobile phone makers after recent rate hike

GST filing deferment no relief for mobile phone makers after recent rate hike

The deferred filing of Goods and Services Tax returns won’t provide much of a breather for mobile phone manufacturers, which face a 6 percentage point rate increase on handsets from April 1 and a further drag on demand, already plunging amid the Covid-19 outbreak.

“Though returns can be filed till June 30, any phone sold after April 1 (including inventory) will be billed at 18% GST (from 12% currently),” said Abhishek Rastogi, a partner at law firm Khaitan & Co.

What the sector needed was an allowance to pay this tax in a deferred way over the next six months, otherwise it is hardly any relief, Rastogi said.

According to market research firm International Data Corporation, even after the 21-day nationwide lockdown ends in mid-April, it will take at least two quarters for demand to revive. Realme and Samsung have already said the increase in GST will be passed on to consumers.

An intelligence firm that tracks the smartphone market has cut this year’s growth estimate to 5.5% from 8% earlier. Realme has estimated that phone prices could go up by 12-15% for reasons including fluctuation in rupee-dollar exchange rates, impact of Covid-19 on the supply chain for components, an increase in memory prices of smartphones, and higher GST.

“At Realme, we are trying to absorb the first three impacts. However, it will not be feasible for us to absorb GST increase impact,” it had said.

The GST Council increased the rate on mobile phones to 18% from 12% on March 14 to correct an inverted duty structure that taxed components at a higher rate than the device.

“While Samsung and Realme have written to us about their decision to pass on the new rates, others have communicated verbally,” Arvinder Khurrana, president of the All India Mobile Retailers Association, told ET. Xiaomi and Vivo said they are yet to take a call on this.

ET had reported that the decision could lead to job losses and nullify efforts to make India a smartphone manufacturing hub.

In the wake of the Covid-19 crisis, finance minister Nirmala Sitharaman said on Tuesday that traders with an annual turnover of less than Rs 5 crore can file GST returns for March, April and May by June 30 without late fees or penalties.

Source: The-Economic-Times

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GST Return filing date extended, relief from late fee, penalties

GST Return filing date extended, relief from late fee, penalties

To provide relief to businesses grappling with the economic impact of Covid 19, the government on Tuesday said it is extending the filing of Return for the month of March, April and May 2020 and composition returns under GST June 30.

Addressing the press, Finance Minister Nirmala Sitharaman added that staggered filing will apply. “While I announce 30th June as the date, specific regions will have dates like 27, 29 or 30th.

Significantly, the FM also said companies which have less than Rs 5 crore turnover will not have to pay interest, late fee or penalty. For bigger companies late fee and penalty will not apply and only interest at a reduced rate of 9% will be charged. “This is only for bigger companies. Majority of companies will have no interest, late fee or penalty,” said Sitharaman.

The date for opting for composition scheme has also been extended to June 30, 2020.

“The extension of GST return filing timelines together with the deferment of e-invoicing and new returns announced earlier would allow businesses to focus on resumption of business processes once normalcy resumes in future, “says MS Mani, Partner, India.

He adds that the waiver of interest, late fees and penalties for SME’s would enable them to focus on reviving their businesses once things are back to normal.

There has been a clamour from taxpayers to provide relief from compliances and especially GST. Today’s announcement is likely to provide some relief. “Some key filing and payment relaxations that should bring rejoice to the industry. One hopes this is the first tranche and there are other tranches to follow, wherein benefits like GST rate reductions, exemption from import duties, reduced compliances etc. are announced.” said Harpreet Singh, Partner,  India.

The Government has also decided that the due date for issue of notice, notification, approval order, sanction order, filing of appeal, furnishing of return, statements, applications, reports, any other documents, time limit for any compliance under the GST laws where the time limit is expiring between 20th March 2020 to 29th June 2020 will be extended to 30th June 2020.

Source: Economic-Times

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CBIC notifies Due Date for Filing GSTR-3B from April 2020 to Sep 2020

CBIC notifies Due Date for Filing GSTR-3B from April 2020 to Sep 2020

The Central Board of Indirect Taxes and Customs ( CBIC ) has notified the due date for filing Monthly Return GSTR-3B of the said rules for each of the months from April, 2020 to September, 2020.

In a Notification issued by CBIC said that, that the due date of return in FORM GSTR-3B of the said rules for each of the months from April, 2020 to September, 2020 shall be furnished electronically through the common portal, on or before the twentieth day of the month succeeding such month.

The Notification also said that, for taxpayers having an aggregate turnover of up to rupees five crore rupees in the previous financial year, whose principal place of business is in the States of Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands or Lakshadweep, the return in FORM GSTR-3B of the said rules for the months of April, 2020 to September, 2020 shall be furnished electronically through the common portal, on or before the twenty-second day of the month succeeding such month.

The Notification also said that, for taxpayers having an aggregate turnover of up to rupees five crore rupees in the previous financial year, whose principal place of business is in the States of Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha, the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi, the return in FORM GSTR-3B of the said rules for the months of April, 2020 to September, 2020 shall be furnished electronically through the common portal, on or before the twenty-fourth day of the month succeeding such month.

Regarding the Payment of taxes for the discharge of tax liability as per FORM GSTR-3B, the notification added that, Every registered person furnishing the return in FORM GSTR-3B of the said rules shall, subject to the provisions of section 49 of the said Act, discharge his liability towards tax by debiting the electronic cash ledger or electronic credit ledger, as the case may be and his liability towards interest, penalty, fees or any other amount payable under the said Act by debiting the electronic cash ledger, not later than the last date, as specified in the first paragraph, on which he is required to furnish the said return.

Presently the due dates of filing GSTR-3B returns for every taxpayer is 20th of every month. From now on, the last date for filing of GSTR-3B for the taxpayers having an annual turnover of Rs 5 crore and above in the previous financial year would be 20th of the month. Thus, around 8 lakh regular taxpayers would have the last date of GSTR-3B filing as the 20th of every month without late fees.

GSTR-3B is a monthly self-declaration that has to be filed a registered dealer from July 2017 till March 2020. Every person who has registered for GST must file the return GSTR-3B including Nil returns.

Source: TaxScan

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CBIC waives GSTR-1 for Persons who couldn’t Opt for Composition Scheme

CBIC waives GSTR-1 for Persons who couldn’t Opt for Composition Scheme

The Central Board of Indirect Taxes and Customs (CBIC) has issued a notification waiving GSTR-1 for Persons who could not opt for Composition Scheme till 7th March 2019.

As per the 39th GST Council meeting, it was decided that the requirement of furnishing FORM GSTR-1 for 2019-20 should be waived for taxpayers who could not opt for availing the option of special composition scheme under notification No. 2/2019-Central Tax (Rate) dated 07.03.2019 by filing FORM CMP-02.

“The said persons who have, instead of furnishing the statement containing the details of payment of self-assessed tax in FORM GST CMP-08 have furnished a return in FORM GSTR-3B under the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as the said rules) for the tax periods in the financial year 2019-20, such taxpayers shall not be required to furnish the statement in the outward supply of goods or services or both in FORM GSTR-1 of the said rules or the statement containing the details of payment of self-assessed tax in FORM GST CMP-08 for all the tax periods in the financial year 2019-20,” the notification said.

Source: TaxScan

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