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GST: GSTR3B return
GST: CBIC notifies due date for filing GSTR-3B for the months of Oct. 2020 to March 2021

GST: CBIC notifies due date for filing GSTR-3B for the months of Oct. 2020 to March 2021

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The Central Board of Indirect Taxes and Customs (CBIC) notified the Central Goods and Services Tax (Thirteenth Amendment) Rules, 2020 which seeks to amend the Central Goods and Services Tax Rules, 2017.

The Board inserted Rule 61(6) to provide a due date for filing GSTR-3B for the months of October 2020 to March 2021 as 20th of next month if the turnover of the individual is more than 5 Crores.

The notification says that every registered person or an Input Service Distributor or a non-resident taxable person or a person paying tax under section 10 or section 51 or, as the case may be, under section 52 shall furnish a return in FORM GSTR-3B, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner, on or before the 20th day of the month succeeding such tax period.

This provision is not applicable to the registered person referred to in section 14 of the Integrated Goods and Services Tax Act, 2017.

The amendment laid down the the condition for furnishing a return in FORM GSTR-3B that taxpayers must have aggregate turnover of up to Rs.5 crore 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 October, 2020 to March, 2021 shall be furnished electronically through the common portal, on or before the twenty-second day of the month succeeding such month.

“Provided further that for taxpayers having an aggregate turnover of up to 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 October, 2020 to March, 2021 shall be furnished electronically through the common portal, on or before the twenty-fourth day of the month succeeding such month,” the notification said.

Source: TaxScan.

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GST Refund
CBIC issues clarification on GST Refund Issues

CBIC issues clarification on GST Refund Issues

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The Board pointed out that certain challenges are being faced by taxpayers in adhering to the compliance requirements under various other provisions of the Central Goods and Service Tax (CGST) Act which also need to be clarified.

The board to ensure uniformity in the implementation of the provisions of the law across the field formations, addressed all the issues raised by the people.

The board empowered under Section 168(1) of the Central Goods and Service Tax (CGST) Act clarified that in case of GST is paid by the supplier on advances received for a future event which got cancelled subsequently and for which invoice is issued before the supply of service, the supplier is required to issue a “credit note” in terms of section 34 of the CGST Act. He shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim.

However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.

In case GST is paid by the supplier on advances received for an event which got cancelled subsequently and for which no invoice has been issued in terms of section 31 (2) of the CGST Act, he is required to issue a “refund voucher” in terms of section 31 (3) (e) of the CGST Act read with rule 51 of the CGST Rules.

The taxpayer can apply for a refund of GST paid on such advances by filing FORM GST RFD-01 under the category “Refund of excess payment of tax”.

In such a case where the goods supplied by a supplier are returned by the recipient and where the tax invoice had been issued, the supplier is required to issue a “credit note” in terms of section 34 of the CGST Act. He shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim in such a case.

However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.

Notification No. 37/2017-Central Tax, dated 04.10.2017, requires LUT to be furnished for a financial year. However, in terms of notification No. 35/2020 Central Tax dated 03.04.2020, where the requirement under the GST Law for furnishing of any report, document, return, statement or such other record falls during between the period from 20.03.2020 to 29.06.2020, has been extended till 30.06.2020.

Therefore, in terms of Notification No. 35/2020-Central Tax, the time limit for filing of LUT for the year 2020-21 shall stand extended to 30.06.2020 and the taxpayer can continue to make the supply without payment of tax under LUT provided that the FORM GST RFD-11 for 2020-21 is furnished on or before 30.06.2020. Taxpayers may quote the reference no of the LUT for the year 2019-20 in the relevant documents.

As per notification No. 35/2020-Central Tax dated 03.04.2020, where the timeline for any compliance required as per sub-section (3) of section 39 and section 51 of the Central Goods and Services Tax Act, 2017 falls during the period from 20.03.2020 to 29.06.2020, the same has been extended till 30.06.2020. Accordingly, the due date for furnishing of return in FORM GSTR-7 along with deposit of tax deducted for the said period has also been extended till 30.06.2020 and no interest under section 50 shall be leviable if tax deducted is deposited by 30.06.2020.

“Difficulty, if any, in the implementation of the above instructions may please be brought to the notice of the Board,” the circular said.

Read More, Here: http://www.cbic.gov.in/resources//htdocs-cbec/gst/Circular_Refund_137_7_2020.pdf

Source: TaxScan.

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

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

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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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GST-TRAN-1
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

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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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