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CBIC vide Press Release dated 24 October 2020 has extended the due date for furnishing Annual Return in Form GSTR-9 and Reconciliation in Form GSTR-9C for the F.Y. 2018-19 till 31 December 2020
In another twist to the tale of transitional credit, the division bench of the Madras HC has reversed the single judge order in the case of Sutherland Global Services Private Limited [2019 (30) G.S.T.L. 628]. While the single judge had held in the favour of the Assessee by allowing carry forward of the accumulated credits of Education Cess, Secondary Higher Education Cess and Krishi Kalyan Cess (‘Cesses’) into GST, the division bench has held otherwise. The rationale of the division bench for arriving at the decision to disallow the credit of cesses into GST has been summarised hereunder:
Cess vs. Tax
101st Constitutional Amendment Act
In light of the above reasons, the Madras HC allowed the Appeal of the Revenue and set aside the judgement of the single judge and held that the Assessee was not entitled to carry forward and set off of unutilised cesses against the GST Output Liability with reference to Section 140 of the CGST Act.
Asst. Commissioner of CGST and C. Ex. vs. Sutherland Global Services Private Limited [WP No.53 of 2020]
The CBIC released a series of Notifications on 15 October 2020 inter alia notifying the due dates for filing Form GSTR-1 and GSTR-3B. said notifications have been summarized hereunder:
Notification No. 75/2020 – C.T. dated 15 October 2020
Time limit for filing Form GSTR-1 by registered persons having aggregate turnover of more than Rs. 1.5 crores, in the preceding F.Y. or the current F.Y., for each of the months from October 2020 to March 2021 till the 11th of the succeeding month.
Notification No. 76/2020 – C.T. dated 15 October 2020
Form GSTR-3B for each of the months from October 2020 to March 2021 shall be furnished electronically through the common portal, on or before the 20th day of the succeeding month. However, it has been provided that for taxpayers, having aggregate turnover of upto Rs. 5 crores, in the previous F.Y., 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 the Nicobar Islands or Lakshadweep, the due date for filing GSTR-3B shall be filed on or before 22nd of the succeeding month.
It has been further provided that for taxpayers having an aggregate turnover of up to Rs. 5 crore in the previous F.Y., 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 shall be furnished electronically through the common portal, on or before the 24th of the succeeding month.
Furthermore, registered persons filing Form GSTR-3B, shall discharge their liability towards tax by debiting the electronic cash ledger or electronic credit ledger, and the liability towards interest, penalty, fees or any other amount payable, by debiting the electronic cash ledger, not later than the last date on which Form GSTR-3B is due.
Notification No. 77/2020 – C.T. dated 15 October 2020
Notifies that filing of Annual Return in Form GSTR-9 and Reconciliation Statement in Form GSTR-9C shall be optional for F.Y. 2017-18 to F.Y. 2019-20 for taxpayers having aggregate turnover of less than Rs. 2 crores.
The DGFT vide Public Notice No. 25/2015-20 dated 13 October 2020 has laid down the procedure for application and issuance of scrips under Rebate of State and Central Taxes and Levies (‘RoSCTL’). The key highlights of the said notification have been summarized hereunder:
The 43rd GST Council Meeting held on 12 October 2020 under the chairmanship of Smt. Nirmala Sitharaman concluded. Following are the key highlights of the Meeting:
The GST Council in its last meeting had decided to make the provision u/r. 138E(b) applicable, which provides for restriction of E-Way bill generation, if the taxpayer has failed to file his GSTR-3B for a consecutive period of 2 months or more.
In respect thereto, it has been informed that GSTIN associated with the respective PAN, having Aggregate Annual Turnover of over Rs. 5 crores, who has failed to file their GSTR-3B Return for 2 or more tax periods, up to the month of tax period of August, 2020, their E-Way Bill generation facility will be blocked on the EWB Portal.
It has been further informed that the EWB generation facility for such GSTINs, whether as consignor or consignee or by transporter, will be blocked on EWB Portal after 15 October 2020.
We are pleased to present to you the second edition of our Vision 360 Newsletter in association with TIOL, covering all the judicial and legislative developments in the fields of taxation. True to the title, this edition of the newsletter brings you key tax and regulatory updates and also insightful articles on ITC of GST on employees’ transportation charges and De-criminalization of Off¬ences under the Companies Act.
In the Sparkle Zone of our Newsletter, we have covered the recent development in the international arbitration case of Vodafone under the India-Netherlands BIPA.
For the Industry Speaks section, we have discussed the umpteen tax issues with a well-renowned name in the Hotelier industry.
Further, in the International Desk section, we have discussed the amendments made by the UAE in its Economic Substance Regulations retrospectively for FY 2019. We have also covered developments of the erstwhile indirect tax laws, which can be helpful precedents for disposing the pending litigations.
We hope that reading of the newsletter would bring an enriching experience to you! Your valuable feedback is always welcome at <firstname.lastname@example.org>
The CBIC vide Notification No. 30/2020 – C.T. dated 03 April 2020 had prescribed that the condition u/r. 36(4) shall apply cumulatively for the tax period February to August, 2020 and that the return in GSTR-3B for the tax period September 2020 shall be furnished with the cumulative adjustment of ITC for the said months.
In respect thereto, the CBIC vide Circular No. 142/12/2020 – GST dated 09 October 2020 has advised the taxpayers to ascertain the details of invoices uploaded by their suppliers for the periods of February, to August 2020, till the due date of furnishing of the statement in GSTR-1 for the month of September 2020 as reflected in GSTR-2As.
It has been clarified that shall reconcile the ITC availed in their GSTR-3Bs for the period February to August 2020 with the details of invoices uploaded by their suppliers of the said months, till the due date of furnishing GSTR-1 for the month of September 2020. The cumulative amount of ITC availed for the said months in GSTR-3B should not exceed 110% of the cumulative value of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers till the due date of furnishing of the statements in GSTR-1 for the month of September 2020.
It has further been clarified that the excess ITC availed arising out of reconciliation during the said period, if any, shall be required to be reversed in GSTR-3B, for the month of September 2020 and failure to do so would be treated as availement of ineligible ITC during the month of September 2020.
Lastly, the CBIC has illustrated the manner of cumulative reconciliation for the said months in terms of proviso to Rule 36(4) of the CGST Rules.
CBIC vide their flyer on Customs (Administration of Rules of Origin under Rules of Origin under Trade Agreements) Rules, 2020 (‘CAROTAR’) have inter alia explained the background of foreign trade and the requirement to impose the said Rules. In the recent trends of Foreign Trade, there has been a staggered reduction in preferential duties under existing Foreign Trade Agreements (‘FTAs’) along with resultant increase in the preferential trade volumes. Further, frequent instances of misuse have come to notice of the Government in which fraudulent traders have mis-declared country of origin in order to avail undue duty concessions.
Owing to the above-mentioned fraudulent mis-use of the FTAs, the Government had inserted Chapter VAA and section 28DA in the Customs Act. The new section inter alia provided for a basic level of due diligence on the part of an importer to satisfy himself that the claimed originating criteria have been met, and that mere submission of a Certificate of Origin may not be sufficient.
In light of the above background, the CBIC has provided the following clarifications in respect of CAROTAR 2020 vide the FAQs in the flyer:
The summary of the provisions of CAROTAR 2020 may be accessed at https://www.gstlegal.co.in/newsletter-detail.html?id=425
Earlier in June 2020, the Ministry of Textiles had provided that the DGFT would be issuing the Duty Credit Scrips for RoSTL over and above the budget provision for the shipments made prior to 07 March 2019 only. The allocation of RoSTL over and above budget provision for issuing scrips, would be provided by the Department of Revenue for such old cases which could not be disbursed due to budget limitation.
In respect thereto, the DGFT vide Notification No. 37/2015-2020 dated 06 October 2020 has enabled issuance of duty credit scrips under the RoSCTL, for which the procedure will be laid down separately.
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