Important Notifications for GST

Two notifications viz. Notification No. 26/2018 – Central Tax & Notification No.27/2018 – Central Tax dated 13.06.2018 have been issued to amend the CGST Rules. Amendments in brief are as under: 

DISPOSAL OF SEIZED GOODS 

Vide Notification No.27/2018 – Central Tax, Government has notified the list of goods which shall, as soon as may be after its seizure under sub-section (2) of section 67 of the CGST Act, can be disposed of by the proper officer, having regard to the perishable or hazardous nature, depreciation in value with the passage of time, constraints of storage space or any other relevant considerations of the said goods. Readers may refer the attached Notification for the list.

FAILURE TO PAY WITHIN 180 DAYS 

Second proviso to Sec. 16(2) of the CGST Act, 2017 provides that the ITC availed shall be added to the output tax liability to the extent where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of 180 days from the date of issue of invoice. Sec. 15(2)(b) of the said Act which deals with the determination of the value of supply provides that any amount that the supplier is liable to pay in relation to such supply but which has been incurred by the recipient and not included in the price actually paid or payable, shall be added to the transaction value. Hence an issue was whether such amount which is notionally added but not received by the supplier can be said to have been paid by the recipient and hence recipient can avail the ITC thereof ?? Thus an amendment has been made by adding a second proviso to Rule 37(1) to provide that such value notionally added shall be deemed to have been paid. 

SALES TAX PRACTITIONER OR TAX RETURN PREPARER 

A person enrolled as a sales tax practitioner or tax return preparer for a period of not less than five years in the previous regime can be enrolled as a goods and services tax practitioner if such person passes the examination within a period of one year from 01.07.2017. Said period has been modified to 18 months. Hence such persons are required to pass the examination by December, 2018. 

REFUND FORMULA – INVERTED RATE STRUCTURE 

Sub-rule 89(5) has been substituted with effect from 01.07.2017 to provide for a revised formula to calculate the maximum refund amount which can be claimed in cases where ITC has been accumulated on account of inverted duty structure. Revised formula is as under: 

Maximum Refund Amount = {(Turnover of inverted rated supply of goods and services) x Net ITC ÷ Adjusted Total Turnover} - tax payable on such inverted rated supply of goods and services 

It will be very interesting to observe that the above change has been given a retrospective effect.

REFUND IN CASE OF UNO, CONSULATE, EMBASSY, ETC. 

Sec. 55 of the CGST Act, 2017 permits that any specialised agency of the United Nations Organisation or any Multilateral Financial Institution and Organisation notified under the United Nations (Privileges and Immunities) Act, 1947, Consulate or Embassy of foreign countries and any other person or class of persons as may be specified in this behalf shall be entitled to claim a refund of taxes paid on the notified supplies of goods or services or both received by them. Rule 95(3) further provided that the refund shall be granted in case of the inward supplies of goods or services or both were received from a registered person against a tax invoice and the price of the supply covered under a single tax invoice exceeds five thousand rupees, excluding tax paid, if any. Said limit of INR 5000/- has been has been removed. 

CONSUMER WELFARE FUND 

Provision has been inserted in Rule 97(1) to provide for the deposit of the amount of cess to the Consumer welfare fund. 

SHARING OF FUNDS ORDERED TO BE PAID BY THE ANTI-PROFITEERING AUTHORITY 

Sub-rule (3) to Rule 133 has been amended to provide that the funds ordered to be paid by such authority shall be shared equally by Center & the concerned State. 

E-WAY BILL - EMPTY CYLINDERS FOR PACKING OF LIQUEFIED PETROLEUM GAS 

Clause (o) has been inserted to Rule 138(14) to provide that E-way bill shall not be required in case of movement of empty cylinders for packing of liquefied petroleum gas for reasons other than supply. Hence on return of such cylinders from the place of customer, E-way bill will not be now required irrespective of the value. 

CHANGES IN THE FORMS 

GSTR – 4: Serial 4A of Table 4 of the said form is not required to be furnished for the tax periods July, 2017 to September, 2017, October, 2017 to December, 2017, January, 2018 to March, 2018 and April, 2018 to June, 2018. GSTR -4 is a quarterly return to be filed by the composition suppliers. Serial 4A of the said form asks for the details of inward supplies from registered suppliers. Said details are not required to be furnished for the stated periods. 

PCT-01: Registration form for enrolment as GST practitioner has been amended to provide for a declaration. 

RFD – 01: Changes have been made in the said form in the Statement related to the refund of accumulated ITC due to inverted tax structure. This is to make the form in line with the above referred change in the formula. Similar change has been made in RFD – 01A for online filing.