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GST Update

Stay updated with the latest GST changes, notifications, and circulars issued by NACIN. This presentation covers important updates since the last update on 03.03.2018.

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GST Update

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  1. GST Update Weekly Update 10.03.2018 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  2. Background • This Presentation covers the GST changes / observations/ press releases/ Tweet FAQs/ Sectoral FAQs released by CBEC since the last update on 03.03.2018. It supplements the earlier GST Updates. • This presentation is based on CGST Act/Rules/ Notifications. Similar parallel provisions in State Laws may be referred to as required National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  3. Notifications and Circulars Two Central Tax Notifications issued; E Way Bill Rules amended One Circular issued explaining levy of GST on service by members of JV to JV and vice-versa. Letter/Instruction dt 27.02.2018 on Verification of Transitional Credit issued by DG, Audit/Central Taxes GST Council meeting held on 10.03.2018 – Press Release 3 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  4. CGST Rules amended http://www.cbec.gov.in/resources//htdocs-cbec/gst/Notification-12-2018-Central_tax-English.pdf CGST (Second Amendment) Rules, 2018 Notification No. 12/2018-Central Tax dated 07.03.18 issued. • GST Tran-2 – Last date for filing TRAN2 extended to 31.03.2018 • E– Way Bills Rules Revised Notification to come into effect from a date to be notified in the official gazette 4 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  5. GST Tran-2 (i)For Rule 117 (4)(b)(iii), the following shall be substituted, namely:- "(iii) The registered person availing of this scheme and having furnished the details of stock held by him in accordance with the provisions of clause (b) of sub-rule (2), submits a statement in FORM GST TRAN 2 by 31st March 2018, or within such period as extended by the Commissioner, on the recommendations of the Council, for each of the six tax periods during which the scheme is in operation indicating therein, the details of supplies of such goods effected during the tax period;” 5 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  6. Late fees for filing of GSTR-5A by OIDAR Service Providers – Notification No. 6/2018 rescinded http://www.cbec.gov.in/resources//htdocs-cbec/gst/Notification-13-2018-central_tax-English.pdf Notification 13/2018-Central Tax dated 07.03.2018 issued Notification rescinds Notification No. 6/2018-Central Tax dated – 23.01.2018 (This notfn had reduced late fees for filing of GSTR 5A by OIDAR service providers to Rs.25/day (Rs.10/day in case of Nil Returns)) National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  7. Service by Member of JV to JV and vice-versa/inter-se service between members of JV - Clarifications http://www.cbec.gov.in/resources//htdocs-cbec/gst/circularno-35-cgst.pdf;jsessionid=57EB4217ED40794F11A644BC704A1FAB Circular No. 35/9/2018-GST dated 05.03.2018 issued Clarifies applicability of GST on services provided by Members of JV to the JV or vice versa States that clarifications given in service tax regime vide circular no. 179/5/2014 – ST issued from F.No. 179/5/2014-ST dated 24 September 2014 EQUALLY APPLICABLE UNDER GST REGIME ALSO. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  8. Service by Member of JV to JV and vice-versa/inter-se service between members of JV - Clarifications Illustration A: There are 4 members in the JV including the operating member and each one contributes Rs 100 as part of their share. A total amount of Rs 400 is collected. The operating member purchases machinery for Rs 400 for the JV to be used in oil production. Illustration B: There are 4 members in the JV including the operating member and each one contributes Rs 100 as part of their share. A total amount of Rs 400 is collected. The operating member thereafter uses its own machine and performs exploration and production activities on behalf of the JV. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  9. Service by Member of JV to JV and vice-versa/inter-se service between members of JV - Clarifications Illustration A will not be the subject matter of ‘ST/GST’ for the reason that the operating member is not carrying out an activity for another for consideration. In Illustration A, the money paid for purchase of machinery is merely in the nature of capital contribution and is therefore a transaction in money On the other hand, in Illustration B, the operating member uses its own machinery and is therefore providing ‘service’ within the scope of supply of CGST Act, 2017. This is because in this scenario, the operating member is recovering the cost appropriated towards machinery and services from the other JV members in their participating interest ratio. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  10. Verification of Transitional Credit Letter F.No.381/274/2017 dated 27.02.2018 issued by DG, Audit/Central Taxes. Taking of transitional credit u/s 140(3) of CGST Act by entities in Construction Sector. Transitional Credit of Inputs already used in Construction and containing in Work In Progress (WIP) as on 30.06.2017 Taking of transitional credit not only on inputs held in stock as on 30.06.2017, but also taking credit on the inputs which had been consumed before the appointed day in their building under development. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  11. Verification of Transitional Credit..Contd… Letter F.No.381/274/2017 dated 27.02.2018 issued by DG, Audit/Central Taxes. Such Credits not permissible for the following reasons Building under construction being attached to earth cannot be called as goods in terms of sec 2(52) and in terms of various case laws under the erstwhile Central Excise Act. Transitional Credit of Inputs already used in Construction and containing in Work In Progress (WIP) as on 30.06.2017 not admissible. Field Formations instructed to verify transitional credit as per above clarification. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  12. E Way Bill Updates National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  13. GST Council Meeting on 10.03.2018 Press Release dated 10.03.2018 E-Way Bill Rules for inter-state movement of goods to come into force with effect from 01.04.2018 For intra-State movement of goods, e-way bill system will be introduced w.e.f a date to be announced in a phased manner but not later than 01st June, 2018 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  14. Furnishing of Part A by transporter http://www.cbec.gov.in/resources//htdocs-cbec/gst/Notification-12-2018-central_tax-English.pdf Proviso to Rule 138(1) inserted Provided that the transporter, on an authorization received from the registered person, may furnish information in Part A of FORM GST EWB-01, electronically, on the common portal along with such other information as may be required on the common portal and a unique number will be generated on the said portal: National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  15. Generation of E way Bill by Courier or ecommerce operator Proviso 2 to Rule 138(1) inserted: Provided further that where the goods to be transported are supplied through an ecommerce operator or a courier agency, on an authorization received from the consignor, the information in Part A of FORM GST EWB-01 may be furnished by such e-commerce operator or courier agency and a unique number will be generated on the said portal: Thus, EWB can now be generated by Courier company/ transporter/ecommerce operator National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  16. Generation of E way Bill by job worker Third Proviso to Rule 138(1) - Amended Provided also that where goods are sent by a principal located in one State or Union territory to a job worker located in any other State or Union territory, the e-way bill shall be generated either by the principal or the job worker, if registered, irrespective of the value of the consignment: Earlier it was to be issued only by the principal National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  17. Exclusion of exempt supplies from calculation of consignment value Explanation 2 to Rule 138(1) amended Explanation 2.- For the purposes of this rule, the consignment value of goods shall be the value, determined in accordance with the provisions of section 15, declared in an invoice, a bill of supply or a delivery challan, as the case may be, issued in respect of the said consignment and also includes the central tax, State or Union territory tax, integrated tax and cess charged, if any, in the document and shall exclude the value of exempt supply of goods where the invoice is issued in respect of both exempt and taxable supply of goods. Thus value of exempt supplies will not be included for calculation of consignment value of goods ( < or > Rs.50,000/-) National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  18. Non requirement of Part B for 1st and last mile of supply Third Proviso to Rule 138(3) amended: Provided also that where the goods are transported for a distance of up to tenfiftykilometers within the State or Union territory from the place of business of the consignor to the place of business of the transporter for further transportation, the supplier or the recipient, or as the case may be, the transporter may not furnish the details of conveyance in Part B of FORM GST EWB-01. Movement of goods from the place of consignor to the place of transporter up to a distance of 50 Km does not require filling of Part-B of e-way bill. However, they have to generate Part –A of e-way bill. Similar corresponding change done in Proviso to Rule 138(5) as well for movement of goods from transporter to consignee National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  19. Validity of unique number Second Proviso to Rule 138(9) amended: Provided further that the unique number generated under sub-rule (1) shall be valid for a period of fifteen days for updationof Part B of FORM GST EWB-01. Thus Unique number generated after uploading of Part A shall be valid now for 15 days for generation of E-way Bill ( adding Part-B) National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  20. Validity of EWB Validity period for E Way Bill in Rule 138(10) amended; Differential validity for over dimensional cargo National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  21. Extension of Validity of E Way Bill Proviso to Rule 138(10) amended Provided further that where, under circumstances of an exceptional nature, including trans-shipment, the goods cannot be transported within the validity period of the e-way bill, the transporter may extend the validity period after updating the details in Part B of FORM GST EWB-01, if required. Earlier the transporter was required to generate new E way Bill; Now he can extend the validity period National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  22. Concept of one day Explanation to Rule 138(10) amended Explanation 1.—For the purposes of this rule, the “relevant date” shall mean the date on which the e-way bill has been generated and the period of validity shall be counted from the time at which the e-way bill has been generated and each day shall be counted as the period expiring at midnight of the day immediately following the date of generation of e-way bill. Earlier One day was ending after 24 hours from the time when the e way bill is generated National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  23. Meaning of Over Dimensional Cargo Explanation 2 to Rule 138(10) inserted for explaining the meaning of over dimensional cargo Explanation 2.— For the purposes of this rule, the expression “Over Dimensional Cargo” shall mean a cargo carried as a single indivisible unit and which exceeds the dimensional limits prescribed in rule 93 of the Central Motor Vehicle Rules, 1989, made under the Motor Vehicles Act, 1988 (59 of 1988). National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  24. Cases where no E Way Bill Required Rule 138(14) amended; New serial no. h to n added where no way bill required to be generated (h) where the goods are being transported— (i) under customs bond from an inland container depot or a container freight station to a customs port, airport, air cargo complex and land customs station, or from one customs station or customs port to another customs station or customs port, or (ii) under customs supervision or under customs seal; (i) where the goods being transported are transit cargo from or to Nepal or Bhutan; (j) where the goods being transported are exempt from tax under notifications No. 7/2017-Central Tax (Rate), dated 28.06.17 and No. 26/2017- Central Tax (Rate), dated the 21.09.17; National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  25. Cases where no E Way Bill Required (k) any movement of goods caused by defence formation under Ministry of defence as a consignor or consignee; (l) where the consignor of goods is the Central Government, Government of any State or a local authority for transport of goods by rail; (m)where empty cargo containers are being transported; and (n) where the goods are being transported up to a distance of twenty kilometers from the place of the business of the consignor to a weighbridge for weighment or from the weighbridge back to the place of the business of the said consignor subject to the condition that the movement of goods is accompanied by a delivery challan issued in accordance with rule 55. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  26. Recommendations of GST Council Meeting on 10th March, 2018 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  27. GST Council Meeting on 10.03.2018 Press Release dated 10.03.2018 regarding policy changes. I. Return filing System The present system of filing of GSTR 3B and GSTR 1 is extended for another three months i.e., April to June, 2018 till the new return system is finalized. A new model was discussed extensively and Group of Ministers on IT has been tasked to finalize the same. II. Reverse charge mechanism The liability to pay tax on reverse charge basis has been deferred till 30.06.2018. In the meantime, a Group of Ministers will look into the modalities of its implementation to ensure that no inconvenience is caused to the trade and industry. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  28. GST Council Meeting on 10.03.2018 Press Release dated 10.03.2018 regarding policy changes. III. TDS/TCS The provisions for deduction of tax at source (TDS) under section 51 of the CGST Act and collection of tax at source (TCS) under section 52 of the CGST Act shall remain suspended till 30.06.2018. In the meantime, the modalities of linking State and Central Governments accounting system with GSTN will be worked out so that seamless credit is available to the registered traders whose tax is deducted or collected at source. IV. Grievance Redressal Mechanism GST implementation Committee (GIC) has been tasked with the work of redressing the grievances caused to the taxpayers arising out of IT glitches. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  29. GST Council Meeting on 10.03.2018 Press Release dated 10.03.2018 regarding Data Analytics. GST Council has been apprised of the fact that CBEC and GSTN have started detailed data analytics across a number of data sets available with them. The outcome of preliminary data analysis has revealed interesting insights: • It has emerged that there is variance between the amount of IGST & Compensation Cess paid by importers at Customs ports and input tax credit of the same claimed in GSTR-3B. • There are major data gaps between self-declared liability in FORM GSTR-1 and FORM GSTR-3B. • It was deliberated that this information may be further analysed and adequate action may be initiated accordingly. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  30. GST Council Meeting on 10.03.2018 Press Release dated 10.03.2018 regarding Extension of tax exemptions for exporters for another 6 months. The Council decided to extend the available tax exemptions on imported goods for a further 6 months beyond 31.03.2018. Thus, exporters presently availing various export promotion schemes can now continue to avail such exemptions on their imports up to 01.10.2018, by which time an e-Wallet scheme is expected to be in place to continue the benefits in future. The implementation of E-Wallet scheme deferred by 6 months i.e., up to 01.10.2018; and Extend the present dispensation in terms of exemptions etc. which is available up to 31.03.2018, for a further 6 months i.e., up to 01.10.2018. National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  31. GST Portal Updates National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  32. Amendment tables in Form GSTR-4 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  33. Reporting of Payments by OIDAR service providers National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  34. Search criteria for Model-II states National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  35. Blocking of credits by Tax officer – facility for Model II states National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  36. LEGAL UPDATES GST Legal Updates National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  37. Non-uploading of E-way Bill – Detention u/s 129 not justified Indus Towers Ltd Vs Assistant State Tax Officer reported in 2018-TIOL-12-HC-KERALA-GST. Goods detained because it was not accompanied by State E-way bill. Since the assessee had not uploaded declaration in Form KER-1 before the goods were transported, such transportation was not in accordance with Rules 55 and 138 of the State GST Rules – Decision of High Court Whether detention u/s 129 of the Acts was justified merely for non compliance of Rules 55 and 138 of the State GST rules - Considered provisions of Sections 129 & 130 of the statutes - Combined reading of the two indicates that detention of goods is contemplated only when it is suspected that the goods are liable for confiscation - In such case, mere infraction of the procedural Rules like Rules 55 and 138 of the State GST Rules cannot result in detention of goods, though they may have freedom to impose penalty - Hence detention of goods is without jurisdiction - Department directed to release the goods: National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  38. Any ISSUES/ queries? https://cbec-gst.gov.in/ CBEC MITRA HELPDESK • 1800 1200 232 • cbecmitra.helpdesk@icegate.gov.in GSTN Help Desk • https://selfservice.gstsystem.in/ - Grievance redressal portal • Help Desk Number: 0120-4888999 National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  39. Any ISSUES/ queries? • Twitter Handles • For General Questions • https://twitter.com/askGST_GoI • For technology related issues • https://twitter.com/askGSTech • NACIN twitter • https://twitter.com/NACIN_OFFICIAL National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

  40. THANK YOU National Academy of Customs, Indirect Taxes and Narcotics (NACIN)

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