The meeting was also attended by Union Minister of State for Finance & Corporate Affairs Shri Anurag Thakur besides Finance Ministers of States & UTs and senior officers of the Ministry of Finance& States/ UTs.
The GST Council has made the following recommendations:
1. Levy of Compensation Cess to be extended beyond the transition period of five years i.e. beyond June, 2022, for such period as may be required to meet the revenue gap. Further details to be worked out.
2. Centre is releasing compensation of ₹ 20,000 crore to States today towards loss of revenue during 2020-21 and an amount of about ₹ 25,000 crore towards IGST of 2017-18 by next week.
3. Enhancement in features of return filing: In its 39th Meeting held in March 2020, the Council had recommended an incremental approach to incorporate features of the new return system in the present familiar GSTR-1/3B scheme. Various enhancements have since been made available on the GST Common Portal. With a view to further enhance Ease of Doing Business and improve the compliance experience, the Council has approved the future roadmap for return filing under GST. The approved framework aims to simplify return filing and further reduce the taxpayer’s compliance burden in this regard significantly, such that the timely furnishing of details of outward supplies (GSTR-1) by a taxpayer and his suppliers would (i) allow him to view the ITC available in his electronic credit ledger from all sources i.e. domestic supplies, imports, and payments on reverse charge, etc. prior to the due date for payment of tax, and (ii) enable the system to auto-populate return (GSTR-3B) through the data filed by the taxpayer and all his suppliers. In other words, the timely filing of the GSTR-1 statement alone would be sufficient as the return in FORM GSTR-3B would get auto prepared on the common portal. To this end the Council recommended/decided the following:
4. As a further step towards reducing the compliance burden particularly on the small taxpayers having aggregate annual turnover < Rs. 5 cr., the Council’s earlier recommendation of allowing filing of returns on a quarterly basis with monthly payments by such taxpayers to be implemented w.e.f. 01.01.2021. Such quarterly taxpayers would, for the first two months of the quarter, have an option to pay 35% of the net cash tax liability of the last quarter using an auto-generated challan.
5. Revised Requirement of declaring HSN for goods and SAC for services in invoices and in FORM GSTR-1 w.e.f. 01.04.2021 as under:
6. Amendment to the CGST Rules: Variousamendments in the CGST Rules and FORMS have been recommended which includes provision for furnishing of Nil FORM CMP-08 through SMS.
7. Refund to be paid/disbursed in a validated bank account linked with the PAN & Aadhaar of the registrant w.e.f. 01.01.2021.
8. To encourage the domestic launching of satellites particularly by young start-ups, the satellite launch services supplied by ISRO, Antrix Corporation Ltd., and NSIL would be exempted.
Note:- The decisions of the GST Council have been presented in this note in simple language for easy understanding. The same would be given effect to through Gazette notifications/ circulars which alone shall have force of law.
The Press Release can be accessed at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=1661827
The CBIC vide Notification No. 72/2020- Central Tax dated September 30, 2020 issued Central Goods and Services Tax (Eleven Amendment) Rules, 2020 effective from September 30, 2020. Amendments are discussed below:
1. Sub- rule (r) inserted in Rule 46 of the Central Goods and Services Tax Rules, 2017 (“CGST Rules”) for mentioning Quick Refence code having embedded Invoice Reference Number (“IRN”) in tax invoice referred to in Section 31 of the Central Goods and Services Tax Act, 2017 (“CGST Act”):
“(r) Quick Reference code, having embedded Invoice Reference Number (IRN) in it, in case invoice has been issued in the manner prescribed under sub-rule (4) of rule 48.”.
2. Inserted proviso to sub-rule (4) of Rule 48 of the CGST Rules to give power to the Commissioner to exempt person or a class of registered persons from issuance e-invoice under Rule 48(4) of the CGST Rules. Relevant portion is reproduced below:
“(4) The invoice shall be prepared by such class of registered persons as may be notified by the Government, on the recommendations of the Council, by including such particulars contained in FORM GST INV-01 after obtaining an Invoice Reference Number by uploading information contained therein on the Common Goods and Services Tax Electronic Portal in such manner and subject to such conditions and restrictions as may be specified in the notification.
Provided that the Commissioner may, on the recommendations of the Council, by notification, exempt a person or a class of registered persons from issuance of invoice under this sub-rule for a specified period, subject to such conditions and restrictions as may be specified in the said notification.”
3. Substituted sub-rule (2) of Rule 138A of the CGST Rules to provide for Quick Refence code having embedded IRN in the invoice issued under sub-rule (4) of Rule 48 of the CGST Rules for electronic verification; meaning thereby now there is no need for physical verification of invoice. Relevant portion is reproduced below:
“(2) In case, invoice is issued in the manner prescribed under sub-rule (4) of rule 48, the Quick Reference (QR) code having an embedded Invoice Reference Number (IRN) in it, may be produced electronically, for verification by the proper officer in lieu of the physical copy of such tax invoice.”
Further, press release dated September 30, 2020 has been released providing relaxation of one month i.e., during the month of October, 2020 taxpayers required to generate e-invoice can issue invoice without following the manner prescribed under rule 48(4) of the CGST Rules provided that such taxpayers obtain IRN for such invoices from the Invoice Reference Portal (“IRP”) within 30 days of date of invoice. No such relaxation would be available for the invoices issued from November 1, 2020. Relevant portion of is reproduced below:
“2.1 It has been reported that even after more than 9 months of the first notification in this regard, some of these taxpayers having aggregate turnover of Rs. 500 Cr. and above are still not Accordingly, as a last chance, in the initial phase of implementation of e-invoice, it has been decided that the invoices issued by such taxpayers during October 2020 without following the manner prescribed under rule 48(4), shall be deemed to be valid and the penalty leviable under section 122of the CGST Act, 2017, for such non-adherence to provisions, shall stand waived if the Invoice Reference Number (IRN) for such invoices is obtained from the Invoice Reference Portal (IRP) within 30 days of date of invoice.
2.2. The same is illustrated with an example: In case a registered person has issued an invoice dated 3rdOctober, 2020 without obtaining IRN but reports the details of such invoice to IRP and obtains the IRN of the invoice on or before 2nd November, 2020 then it shall be deemed that the provisions of rule 48 (5) of the CGST Rules, 2017 are complied with and the penalty imposable under section 122 of the CGST Act, 2017 shall also stand waived. Relevant notifications would follow.
The Central Goods and Services Tax (Eleven Amendment) Rules, 2020 can be accessed at: https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-72-central-tax-english-2020.pdf
October – the last quarter of 2020 is here already!
While this year has seen a lot of roadblocks with a pandemic hitting the world followed by a lockdown and economic crises, it sure has kept our minds occupied and has made us solution-oriented.
On the GST front, the e-invoicing implementation has finally seen the light of day and is set to roll from 1st October 2020 for companies with turnover Rs. 500 crores or more.
The upcoming GST Council Meeting is said to be scheduled on October 5, 2020. The trending matter of compensation cess to the states will be discussed. The council is expected to approve a two-year extension of compensation cess levy on goods and services to allow the Centre to pay the entire shortfall in GST tax collection by states.
The GST collection for June stood at Rs 90,917 crore and the collection for July was at Rs 87,422 crore. In the month of August, the GST collection further dropped and stood at Rs 86,449 crore. From this aggregate amount, Rs 15,906 crore is CGST, Rs 21,064 crore is SGST, IGST of Rs 42,264 crore including Rs 19,179 crore collected on import of goods and a cess collection of Rs 7, 215 crores including Rs 673 crore collected on import of goods.
Recently, the government offered relief in late fees to Taxpayers filing Form GSTR 4 or GSTR 10 and change in the navigation of Comparison of liability declared and ITC claimed the report. There have been several new updates released in the past month.
Prominent Indian festivals like Navratri and Dusshera fall in October. Just like Ganesh Chaturthi, pandaals and group gatherings will be prohibited citing the rising cases of COVID-19 throughout the country. People will have to celebrate keeping in mind the solemnity of the present scenario.
The date for furnishing of Income-tax returns under Section 139 of the Income-tax Act, 1961 (“the IT Act”) for the Assessment Year 2019-20 was March 31, 2020. However, on consideration of difficulties being faced by the taxpayers due to the COVID-19 pandemic, the said date was initially extended to June 30, 2020 and subsequently to July 31, 2020 and September 30, 2020 vide the Taxation and other laws (Relaxations of certain provisions), Ordinance dated March 31, 2020, Notification No. 35/2020 dated June 24, 2020 and Notification No.56/2020 dated July 29, 2020 respectively.
Order:
On further consideration of genuine difficulties being faced by the taxpayers due to the outbreak of the COVID-19 pandemic, the CBDT vide F. No. 225/150/2020-ITA-II dated September 30, 2020, in the exercise of powers conferred under Section 119(2)(a) of the IT Act further extended the date for furnishing of belated and revised returns for the Assessment Year 2019-20 under sub-section (4) and (5) of Section 139 of the IT Act respectively, from September 30, 2020 to November 30, 2020.
