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GST: CBIC issues SOP for implementation of Provision of Suspension of Registrations under Rule 21A(2A) of CGST Rules, 2017

February 12, 2021 admin Comments 0 Comment

The Central Board of Indirect Taxes and Customs (CBIC) notified the Standard Operating Procedure (SOP) for implementation of the provision of suspension of registrations under sub-rule (2A) of rule 21A of CGST Rules, 2017.

Sub-rule (2A) of rule 21A provides for immediate suspension of registration of a person, as a measure to safeguard the interest of revenue, on the observance of such discrepancies /anomalies which indicate a violation of the provisions of Act and rules made thereunder; and that continuation of such registration poses an immediate threat to revenue.

Till the time an independent functionality for FORM REG-31 is developed on the portal, in order to ensure uniformity in the implementation of the provisions of the above rule across the field formations, the Board, in the exercise of its powers conferred by section 168 (1) of the CGST Act, provides the guidelines for implementation of the provision of suspension of registrations under the said rule.

The CBIC notified that the registration of specified taxpayers shall be suspended and system-generated intimation for suspension and notice for cancellation of registration in FORM GST REG-31, containing the reasons of suspension, shall be sent to such taxpayers at their registered e-mail address. Till the time functionality for FORM REG-31 is made available on the portal, such notice/intimation shall be made available to the taxpayer on their dashboard on the common portal in FORM GST REG-17. The taxpayers will be able to view the notice in the “View/Notice and Order” tab post login.

The taxpayers, whose registrations are suspended (hereinafter referred to as “the said person”) under the above provisions, would be required to furnish a reply to the jurisdictional tax officer within thirty days from the receipt of such notice/intimation, explaining the discrepancies/anomalies, if any, and shall furnish the details of compliances made or/and the reasons as to why their registration should not be canceled.

Firstly, the said person would be required to reply to the jurisdictional officer against the notice for cancellation of registration sent to them, in FORM GST REG-18 online through Common Portal within the time limit of thirty days from the receipt of notice/ intimation.

Secondly, in case the intimation for suspension and notice for cancellation of registration is issued on the ground of non -filing of returns, the said person may file all the due returns and submit the response. Similarly, in other scenarios as specified under FORM GST REG-31, they may meet the requirements and submit the reply.

After issuance of FORM GST REG-31 via email the list of such persons would be sent to the concerned Nodal officers of the CBIC/ States. Also, the system generated notice can be viewed by the jurisdictional proper officers on their Dashboard for suitable actions. Upon receipt of reply from the said person or on expiry of thirty days (reply period), a task would be created in the dashboard of the concerned proper officer under “Suo moto cancellation proceeding”.

Proper officer, post examination of the response received from the said person, may pass an order either for dropping the proceedings for suspension/ cancellation of registration in FORM GST REG-20 or for cancellation of registration in FORM GST REG-19. Based on the action taken by the proper officer, the GSTIN status would be changed to “Active” or “Cancelled Suo-moto” as the case may be.

Till the time-independent functionality for FORM GST REG-31 is fully ready, it is advised that if the proper officer considers it appropriate to drop a proceeding anytime after the issuance of FORM GST REG-31, he may advise the said person to furnish his reply on the common portal in FORM GST REG-18.

The CBIC advised that in case the proper officer is prima-facie satisfied with the reply of the said person, he may revoke the suspension by passing an order in FORM GST REG-20. Post such revocation, if need be, the proper officer can continue with the detailed verification of the documents and recovery of short payment of tax, if any.

Further, in such cases, after detailed verification or otherwise, if the proper officer finds that the registration of the said person is liable for cancellation, he can again initiate the proceeding of cancellation of registration by issuing notice in FORM GST REG-17.

Source: Taxscan.

Aadhaar authentication now open for new GST registrations

August 24, 2020 admin Comments 1 comment

New businesses can now opt for a quick authentication of their credentials using Aadhaar, the 12-digit biometric identification number, and secure Goods and Services Tax (GST) registration without physical verification of their premises.

Aadhaar authentication facility, which was cleared by federal tax body, the GST Council in March, has now been rolled out from Friday, said a statement from the finance ministry. The option for Aadhaar authentication was kept in abeyance temporarily on account of the pandemic.

“Aadhaar authentication for new registration would substantially enhance ease of doing businesses for genuine businesses,” said the ministry statement. A person opting for Aadhaar authentication for new GST registration would get it within just three working days, if no notice is issued and would not need to wait for physical verification.

However, in the case of those opting not to use Aadhaar, GST registration would be given only after physical verification of the business premise, which could take upto 21 days and in case a notice is issued, even more time.

The government has also introduced a system of deemed registration. If the concerned official has not taken any action within the specified time—that is, three days when Aadhaar is used and 21 days when Aadhaar is not used—then registration is deemed to have been granted. “If the registration application has neither been accepted, nor a notice for rejection has been issued, after the specified period, the application shall be deemed to be approved,” said the statement. There are over 12.2 million registered GST businesses currently. (ends)

Source: Live-Mint.

CBIC enables Functionality to file Revocation Application for cancelled GST Registration

August 11, 2020 admin Comments 0 Comment

The Central Board of Indirect Taxes and Customs ( CBIC ) has enabled the Functionality to file revocation application for canceled GST Registration.

In an advisory issued by CBIC said that, “In view of the Removal of Difficulty Order No. 01/2020 dated 25.06.2020, the restriction on filing revocation application, in case it was rejected, has been removed. Aggrieved taxpayers can file an application for revocation of cancellation of registration once again”.

The CBIC also said that, Further, those taxpayers who have filed Appeal against rejection of the Revocation Application and the decision is still pending, they may also file the Revocation of Cancellation.

The Taxpayer is required to log in and navigate to Services> Registration> Application for Revocation to file the application for revocation.

The GST Council had decided to provide an opportunity to revoke the cancellation of GST Registration. The Finance Minister Nirmala Sitharaman had said that the Taxpayers who could not get canceled GST registrations restored in time are being given an opportunity to apply for revocation of cancellation of registration up to September 30, 2020, in all cases where registration has been canceled till June 12, 2020.

Source: TaxScan

CBIC gives nod to clear pending GST registrations under ‘special drive’ by July 30

July 21, 2020 admin Comments 0 Comment

In a move that will help in processing of a swathe of pending applications for goods and services tax (GST) registration, the Central Board of Indirect Taxes (CBIC) has issued directions to all field offices to clear all the pending applications by July 30 under a ‘special drive’. Applications which were pending till June 30, and have not been processed till July 15, will be granted deemed approval, while applications received from July 1, 2020 onwards and that remain pending till July 28, will be deemed as approved on July 31.

“The three days deemed approval of application of registration would be resumed from August 1, 2020,” the Board said in a communication to all principal commissioners and commissioners across various jurisdictions. ET has seen a copy of the communication issued on July 17 by the GST policy wing. “Accordingly, it is requested that all pending applications of registration be disposed of, on or before July 30 as a special drive,” the letter added. ET had written about the issue last month.

The move to fast track registrations follows that of complete stoppage as the government had decided against granting any deemed approvals for GST registrations since March 25 – the beginning of the lockdown to counter the spread of Covid 19 pandemic – for fear of possible misuse during the period where central or state tax offices were either closed or operating with skeletal staff.

Applications that would otherwise take only three working days to be processed were held up for months, as the government extended the lockdown for over two months till June 1, after which offices started to reopen. The Board has asked GST Network to provide a list of registration applications that got deemed approval during the lockdown period – because of technical glitches – to jurisdictional officers so as to conduct physical verification of business premises ‘wherever required.’

Source: Economic-Times.

Kerala becomes the first State to adopt second-level verification for new GST registrations

June 24, 2020 admin Comments 0 Comment

In an effort to curb ‘benami’ businesses under the Goods and Services Tax (GST) regime, Kerala has become probably the first State to introduce second level verification of registration granted on or after June 1.

This verification will be done for both State and central assessees.

In case of services, GST registration would be mandatory for all businesses with turnover of ₹20 lakh or more, with the exception of Manipur, Mizoram, Nagaland and Tripura, where this threshold would be ₹10 lakh. Registration is done mainly on the basis of Permanent Account Number (PAN). As on date, there are nearly 1.22 crore registered assessees in the country.

A circular issued by Kerala’s Commissioner of State Tax, State Goods and Services Tax Department said the Registering Authority has the primary responsibility of ensuring proper paper work.

“Considering the present situation, it is decided to conduct a second level verification by the intelligence wing,” it said.

Details on portal
Further, it mentioned that once registration is granted, all details will be made available on the GST portal and the Deputy Commissioner (Intelligence) of each jurisdictional district will collect and assign the Enforcement Squad for verification.

Squads will conduct detailed enquiries and check the background of proprietor/partners/directors. They will also confirm whether the applicant is genuine or a benami. Then a report will be submitted to District Joint Commissioner with a recommendation whether the registration is to be cancelled or not along with giving reasons for that.

“This verification and furnishing report is to be completed within seven days of receiving the details by each squad,” the circular said. The same mechanism will be adopted for Central assessees but the report will be submitted to the Deputy Commissioner of Central Goods and Services Tax.

The circular noted that despite the instructions issued for ensuring utmost care while granting new registration, bogus and benami registrations are being reported in the State.

This is very critical especially in the case of evasion-prone commodities such as lottery, iron and steel, flooring materials, glass, timber, hill produce, plywood, arecanut, cardamom etc. Since, the system automatically approves the application within three days of filing, many unscrupulous persons misuse the system. This is being done to claim fake input tax credit or taking and supplying credit through circular trade.

Interestingly, the Central Goods and Services Taxes (CGST) rules prescribe physical verification of the place of business of a registered person after the grant of registration, in case of doubt or incomplete Aadhaar authentication.

Accordingly, a report is to be submitted within 15 days. However, as on date no such mechanism has been developed at the State level for re-confirming or verifying the credentials of applicants but now Kerala seems to have taken the lead.

This exercise is critical for all States as all administrative control over 90 per cent of taxpayers having turnover below ₹1.5 crore vests with State tax administration and the remaining with Central tax administration.

Further all administrative control over taxpayers having turnover above ₹1.5 crore shall be divided equally between the Central and State tax administrations.

Source: The-Hindu-Business-Line

GST Council eases compliance burden for businesses

June 15, 2020 admin Comments 0 Comment

The Goods and Services Tax Council on Friday decided to further ease compliance burden of businesses by providing relief on late free and interest payable on late payments.

It reduced late fee and interest for those with tax liabilities and waived off late fee completely for those with no tax liabilities.

Finance minister Nirmala Sitharaman said that GST collections had fallen to about 45%, aggravating the problem of compensation to states, even as states demanded they be funded through market borrowing. The Council will meet again in July to specifically discuss this issue.

“For all those who have no tax liabilities but have not filed their returns between July 2017 and January 2020 there will be zero late fees,” FM Nirmala Sitharaman said.

“For people who have tax liability, maximum late fee for non-filing of GSTR-3B returns for period July 2017 – January 2020 has been capped to Rs 500,” she added.

Companies having no tax liability will not be fined any late fee if they have not filed returns, since July 1, 2017. Those with tax liabilities will now be able to pay a late fee of Rs 500 per month, per return, far lower than Rs 10,000 per month.

During Covid period of February, March and April 2020, interest rate on late return filings by small taxpayers with turnover up to Rs 5 crore, will be reduced to 9% from 18%, if returns of inward supplies are filed till September 30.

The late fee and interest will be waived for the months of May, June and July, if returns are filed by September 30.

“Providing compliance relief, even beyond September if required, to all businesses is essential at the present stage where the primary focus has to be on business revival and working capital management,” said MS Mani, partner at Deloitte India.

Taxpayers can file for restoration of GST registrations that have been cancelled till June 12, 2020, through a one-time extension being offered till September 30.

Compensation Cess
The GST Council will meet again in July to discuss exclusively compensation cess which has to be given to the states. The fund shortfall remains an issue even with the Centre having released Rs 36,400 crore to states as compensation cess for December to February period, while states have asked the GST Council to raise money through market borrowings.

“If there has to be a borrowing, how and who’s going to pay for it… it will be discussed,” Sitharaman said.

The total outgo to states stands at Rs 1.51 lakh crore for FY 2019-20, with installment of March remaining. Between April and November 2019, the government had released Rs 1.15 lakh crore as funds to states. About Rs 12,500 crore more needs to be paid to states for the month of March.

GST Collections
The impact of coronavirus followed by the lockdown has hurt GST collections, with the April and May collections falling well short of targets of Rs 1 lakh crore per month.

“States understood what the collections are, they’re at 45% only,” Sitharaman said.

The Government is faced with a tough balancing act, as on one hand it needs robust GST collections to help meet its regular and extraordinary expenses during the pandemic, while on the other hand, businesses are looking for relief to help them tide the major disruptions, loss of revenue and uncertainties.

“Collections are done by states as well, and every state is fully aware of how much money they’re getting every month. Discussion is happening together, revenues we got are not final,” said revenue secretary Ajay Bhushan Pandey.

A complete picture will emerge after collections for April, May and June are taken into account, he added.

Rate rationalisation
The Council however postponed rationalisation of GST rates for textiles, footwear and fertiliser, even though principally all members agreed that the duty rates need to be corrected as these products faced inverted duty structures.

“The minister for UP wanted to take call on brick-klins and pan masala. This meeting will be taken up in the next GST Council meeting,” Sitharaman said.

Source: Economic-Times.

With 9% interest on delayed payment, taxpayers avoid deferring GST filings

April 16, 2020 admin Comments 0 Comment

Many large taxpayers, those with annual turnover of Rs 5 crore or more, are not availing the extension for paying GST and filing returns as many of them find the 9 per cent per annum interest from the due date too exorbitant.

The government has, in order to lessen the compliance burden on businesses given the outbreak of coronavirus, extended the dates of filing GSTR 3B returns due in March, April and May 2020 to last week of June 2020. Usually, the date for filing returns for a particular month is 20th of the next month. So, for March, the date of filing returns in 20 April, and that for April is 20 May.

Those having aggregate annual turnover less than Rs 5 crore, no interest but late fee and penalty will be charged. But for those with turnover of Rs 5 crore or more, an interest at the reduced rate of 9 per annum from due date (against the current rate of 18 per cent) will be charged.

For businesses with large tax liabilities, delaying the tax payment by three months would mean a large interest outgo, and hence those taxpayers, who have sufficient cash-in-hand are planning to pay the taxes and file returns on time.

“The industry has taken a mixed approach on the delayed return filing, depending upon the cash flow situation. The comparison which is done is the 9 per cent interest (on late payment of GST) and the interest on bank loan. However, filings have slowed down on an overall basis,” says Ritesh Kanodia, partner.

But not all businesses are weighing options between paying interest on late payment of GST and interest on bank loan. For many SMEs with turnover of Rs 5 crore or more, the question is whether to pay the salaries or file GST returns.

Nidhi Goyal, managing partner, says: “Those SMEs which have enough cash flow to pay salaries would like to pay GST liabilities on time and save on the 9 per cent interest cost that they otherwise would incur.

Some businesses are also taking advantage of the fact that the load on GST Network, the IT backbone of the GST regime, will be somewhat less, and are finishing some of the compliances despite the extension of dates.

Rajat Mohan, partner in chartered accountancy, says unlike in normal times around the due dates, one invariably face problems in filing returns, right now the GST Network is working smoothly.

Rajesh Gupta, Co-Founder & Director, says: “Due to lockdown, business transactions have been reduced and left with only 10-20 per cent in total, so accordingly, the load on the network is less as compared to normal. So the network is working smoothly and helping taxpayers to work at home. It has enabled almost more than 20,000 registrations with 10-13 days of the first phase of lockdown.”

Source: Business-Today

GST officers process 10,077 new registrations, 7,876 refund applications in 10 days of lockdown

April 7, 2020 admin Comments 0 Comment

GST Network on Sunday said tax officers have processed over 10,000 new registrations and about 8,000 refund applications in the first 10 days of lockdown till April 3, working through Virtual Private Network (VPN).

In a statement, the Goods and Services Tax Network (GSTN) said it has enabled tax officers of different states and union territories (UTs) to access their office during the lockdown period, and is providing secured access to the office network on request.

Till March 31, 2020, GSTN had enabled 1,748 tax officers from 18 states/UTs to access office through VPN, a secure way to access office network.
This is in addition to the three hill states which already connect to the GST System using VPN.

“A total number of 20,273 registration-related cases were processed during the first 10 days of lockdown, i.e. from March 25 to April 3, 2020. This includes 10,077 cases of new registration, 3,377 cases of core amendment, 3,784 cases of cancellation by application, 1,966 cases of cancellation by suo moto and 1,069 cases of revocation,” GSTN said.

“Similarly, 7,876 cases of refund were also processed during the period,” it added.
The government announced a 21-day nationwide lockdown, beginning March 25, to contain the spread of coronavirus.

Apart from 1.23 crore taxpayers, GSTN provides technology services to 29 states/UTs for implementation of GST.

For these states and UTs, GSTN provides back-office applications like processing of registration application, processing of refund applications, audit, assessment, appeal, among others, for all their tax officers, which is different from the front-end interface used by the taxpayer — GST portal.

Soon after the lockdown was announced, GSTN offered secured access to all these states to enable their officers to work remotely.

“VPN is helping officers to avoid the backlog which could have happened if the cases were not processed during the lockdown. With the provision of auto-approval of applications, if not processed by the tax officer in a time-bound manner, the officers want them to do it manually to avoid any future complication,” GSTN said.

Source: Times-of-India

Gig economy workers may soon have to register under GSTN

January 24, 2020 admin Comments 0 Comment

The government is looking to get services professionals such as plumbers, electricians and beauticians listed on online platforms onto the Goods and Services Tax Network, in what could be yet another move to bring gig economy workers into the fold of the formal workforce.

The Department for Promotion of Industry and Internal Trade ( DPIIT) is considering making it mandatory for online marketplaces such as UrbanClap, HouseJoy and Bro4u to only engage service professionals who have a GST Number or GSTIN, senior government officials in the know of the matter told ET.

While the majority of plumbers, electricians, individual fitness trainers that make use of such online platforms will have a turnover of less than Rs 40 lakh annually, exempting them from paying GST, the government’s move to mandate GSTIN is more in line with having a database of such professionals. “Today, these professionals go into people’s houses and there’s absolutely no way for us to identify them,” said a senior government official.

“While they may not have to pay GST or make the quarterly filings, if they are registered on the network, we can trace them if there’s any untoward event,” said a government official who did not want to be named.

He added that companies such as UrbanClap may be asked to keep a log of all the jobs done by these services professionals, which were facilitated through their platform.

UrbanClap declined to comment as there was no formal communication from the government on the issue. Calls and messages to executives from Housejoy and Bro4u did not yield a response.

“There are several issues that we are examining like consumer safety and protecting the rights of these workers,” said another senior government official, who added that the DPIIT was currently evaluating the matter.

“Even today, there is voluntary GST registration, so it’s not something very big that we are asking them to do.”

Discussions to get services professionals listed onto the GSTN come ahead of the ecommerce policy, which is expected to come out before the close of the current fiscal.

Sources told ET that while the updated policy may dilute sections on data sharing, it could further define rules for online marketplace, inventory-led models and hybrid models.

The ministry of labour and employment is mulling bringing out regulations around the social security of gig economy workers. In its draft Code on Social Security, 2019, the ministry has proposed that all gig workers should be entitled to life and disability cover, health and maternity benefits, old age protection and other benefits

Source: Economic-Times

Bogus dealers used fake address for GST registration in Chandigarh

July 30, 2019 admin Comments 0 Comment

While the UT excise and taxation department unearthed input tax credit (ITC) scam worth over Rs 70 crore, the probe conducted by the department revealed that these bogus dealers used fake addresses for registration under goods and services tax (GST) in Chandigarh.

Meanwhile, the department has also cancelled GST registration number of five bogus dealers, who were earlier slapped a penalty of Rs 17 crore. The registration was cancelled with effect from the date of registration of these bogus firms. The list of other 15 was sent to the central excise department for action.

During probe, the department officials checked records of around 440 firms registered in Chandigarh, and it was found that 132 bogus firms were registered under GST in Chandigarh.

A senior official of the UT excise and taxation department said they have started checking of bills and other documents of those firms, who were issued invoices by five scrap dealers, against whom the department has decided to write to the UT police for registration of FIR. The firms who were issued invoices by five scrap dealers, are mainly operating from Industrial Area phases 1 and 2, he added.

The list of bogus dealers was prepared on the basis of reports received from other states. Deputy commissioner Mandip Singh Brar, who is also holding charge of excise and taxation commissioner, on July 26 had ordered a penalty of Rs 17 crore on the five dealers.

The investigation conducted by the UT excise and taxation department so far has revealed these 20 dealers, including five who were penalized, were not doing any sale and purchase in Chandigarh but dealing only in Haryana and other states. These dealers issued invoices to numerous firms/companies without actual supply of goods mentioned and facilitated illicit ITC entitlement.

A large number of people get involved in such a scam. The accused caused a loss to the exchequer by procuring invoices and undertaking fake purchases from non-existent firms and passing on fake ITC to various end-users who utilised it to offset their GST liabilities.

Source: Times-of-India.

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GST: CBIC issues SOP for implementation of Provision of Suspension of Registrations under Rule 21A(2A) of CGST Rules, 2017

February 12, 2021 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Aadhaar authentication now open for new GST registrations

August 24, 2020 admin Comments 1 comment

CBIC enables Functionality to file Revocation Application for cancelled GST Registration

August 11, 2020 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

CBIC gives nod to clear pending GST registrations under ‘special drive’ by July 30

July 21, 2020 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Kerala becomes the first State to adopt second-level verification for new GST registrations

June 24, 2020 admin Comments 0 Comment

GST Council eases compliance burden for businesses

June 15, 2020 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

With 9% interest on delayed payment, taxpayers avoid deferring GST filings

April 16, 2020 admin Comments 0 Comment

GST officers process 10,077 new registrations, 7,876 refund applications in 10 days of lockdown

April 7, 2020 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Gig economy workers may soon have to register under GSTN

January 24, 2020 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Bogus dealers used fake address for GST registration in Chandigarh

July 30, 2019 admin Comments 0 Comment

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.