E-Book: GST UPDATEZ

Authored ByR. SRIVATSAN, IRS Compiled ByA. SIVA Supdt. of Customs TUTICORIN GST UPDATEZ E-Book Succinct Summary of Important Amendments/Case Laws by India's Leading GST Trainer Compendium of Important Developments under GST Law

Preface In the realm of indirect taxation, the introduction of Goods and Services Tax (GST) stands as a landmark reform that has reshaped the fiscal landscape of numerous countries worldwide. India is no exception to this. The implementation of GST represents a paradigm shift in taxation philosophy, emphasizing a destinationbased consumption tax that aims to streamline the tax structure, enhance compliance, and foster economic growth. This book is a comprehensive exploration of the intricacies of GST, offering a timely analysis of its principles, mechanisms, and practical applications. With an objective to keep pace with the dynamicity of changes that has happened ever since it's roll out in 2017, readers will embark on a journey to unravel the complexities of GST, from its fundamental concepts to its practical implications for all stakeholders including businesses, consumers, practitioners and administrators at large. The chapters within this book delve into various aspects of GST changes yearwise including its historical evolution, key features, tax rates, compliance requirements, input tax credit mechanisms, anti-profiteering provisions, and the impact of GST on different sectors of the economy and the changes associated with it. By elucidating these concepts in a clear and accessible manner, this book aims to equip readers with a comprehensive understanding of how GST operates and how it influences decision-making processes in the business world alongside it's changes. Moreover, this book incorporates important case laws to illustrate the practical application of GST concepts in diverse scenarios, providing readers with valuable insights into how businesses can navigate the complexities of GST compliance, reporting, and strategic tax planning from the eyes of Judiciary. As the author of this book, my mission is to empower readers with the knowledge and chronological changes needed to navigate the intricacies of GST with confidence and clarity. Whether you are a student, a tax professional, a business owner, or simply a curious mind seeking to enhance your understanding of indirect taxation, I trust that this book will serve as a valuable resource to deepen your knowledge of GST and its implications. I invite you to embark on this enlightening journey through the world of GST, and I hope that the insights and perspectives shared in these pages will inspire you to explore the transformative potential of this revolutionary tax system. I am extremely grateful to my family members for their inspirational untiring support and standing with me in all times enduring my work. R. Srivatsan, IRS

I am also obliged to my mentors who infused a curiosity quotient on this subject and motivated in bringing this collection of UPDATEZ. I am immensely indebted to Mr. Siva for his industrious and meticulous compilation work which stands apart to make it more captivating for the readers with all his appealing visual delights. Thank you for joining me on this exploration of GST, and may the knowledge gained from this book empower you to navigate the complexities of taxation with insight and expertise. Happy reading! R. Srivatsan, IRS R. Srivatsan, IRS +91 94440 29361

Compiler’s Note Dear Colleagues, In the ever-evolving landscape of the Goods and Services Tax (GST) regime, frequent amendments to GST laws and procedures are not uncommon. In the dynamic realm of GST updates, staying abreast is imperative, and more often than not, it inundates our communication channels, particularly WhatsApp. A curious observation reveals that many individuals share these updates – be it Notifications, Circulars, Amendments, or Case Laws – without delving into the content, perhaps merely glancing at the headlines. The rush to be the first to disseminate information seems to take precedence for some. However, Shri. Srivatsan Sir's (Assistant Director, NACIN, Chennai) approach stands apart. I can attest to the distinctiveness of his write-ups. He meticulously examines each Notification, Circular, Amendment, or Update, crafting a succinct and incisive commentary. His write-ups, featured under the title "GST UPDATEZ," are not only brief but also possess a sharpness that delves into the intricacies with contextual precision. Personally, I find his write-ups a refreshing departure from lengthy analyses, often allowing me to absorb crucial information efficiently. It is this unique quality that prompted me to compile Shri. Srivatsan Sir's GST UPDATEZ for the period 2018 to 2023 into an E-Book format. The compilation, titled "GST UPDATEZ” features hyperlinks to the relevant notifications, circulars, and case laws. This ensures that readers can enjoy a concise summary of each update and, with a single click, access the full text for more in-depth understanding. I am grateful to Shri. Srivatsan Sir for giving me the opportunity to compile this book, through which I have been able to refresh and brush up on all the developments under GST Law that occurred during the years 2018 to 2023. I believe this E-Book will serve as a valuable resource for officers looking to quickly refresh their knowledge on all the developments on GST throughout 2023. Wishing you all an Enlightening Read. A. SIVA Superintendent of Customs, Tuticorin R. Srivatsan, IRS With Regards, +91 9486562697

SECTION 1 : GST UPDATEZ - 2018 SECTION 2 : GST UPDATEZ - 2019 SECTION 3 : GST UPDATEZ - 2020 1 5 74 Contents SECTION 4 : GST UPDATEZ - 2021 91 SECTION 5 : GST UPDATEZ - 2022 131 SECTION 6 : GST UPDATEZ - 2023 212 R. Srivatsan, IRS

Authored ByR. Srivatsan, IRS 2018 Compiled ByA. Siva Superintendent of Customs TUTICORIN

GST UPDATEZ- 04-12-2018 Date announced for roll-out of new, simplified form. It will take effect from 01-04-2019. Under the new GST form design, columns asking questions, which many small taxpayers found difficult, have been done away with. The new forms will work on the concept of Upload-Lock-Pay. Here’s how the system is expected to work: New return to contain two main tables: – One for reporting outward supplies and - The other for availing Input Tax Credit (ITC) and would be based on invoice uploaded by the supplier. Invoices can be uploaded continuously by the seller and can be continuously viewed and locked by the buyer. Optional facility of filing quarterly returns in forms ‘Sahaj’ (only B2C supply) and ‘Sugam’ (B2C + B2B supply) for small taxpayers having turnover below Rs 50 million. Further details and SOPs are in the pipeline. GST UPDATEZ- 08-12- 2018 FORM GSTR-9 and FORM GSTR-9A have been notified vide notification No. 39/2018-Central Tax, dated 04.09.2018 while FORM GSTR-9C has been notified vide notification no. 49/2018-Central Tax,dated 13.09.2018 as part of the CGST Rules. The due date for filing the same was 31-12- 2018 for the FY 2017-18. The competent authority has decided to extend the due date for filing FORM GSTR-9, FORM GSTR-9A and FORM GSTR-9C till31st March, 2019. The requisite FORMs shall be made available on the GST common portal. I think this has come as a great relief to the business entities. Click here to read full document GST UPDATEZ- 13-12-2018 One query that was posed to me yesterday during a panel discussion was Under which circumstances can a Tax Official initiate for cancellation of GST registration? Suo Moto Cancellation of registration may be initiated by the proper officer for various situations like: – Failure to furnish Application for Enrolment within 3 months from the appointed day or such extended period specified. Any Taxpayer other than composition taxpayer has not filed returns for a continuous period of six months. 01 R. Srivatsan, IRS

Supplies any goods and / or services without issue of any invoice, in violation of the provisions of the Act or rules made thereunder, with the intention to evade tax. Issues any invoice or bill without supply of goods and/or services in violation of the provisions of this Act, or the rules made thereunder leading to wrongful availment or utilization of input tax credit or refund of tax. Collects any amount as representing the tax but fails to pay the same to the account of the Central/State Government beyond a period of three months from the date on which such payment becomes due. Fails to pay any amount of tax, interest or penalty to the account of the Central/State Government beyond a period of three months from the date on which such payment becomes due. Person is no longer liable to deduct tax at source as per the provisions of GST Law. Person is no longer liable to collect tax at source as per the provisions of GST Law. Person no longer required to be registered under provisions of GST Law. GST Practitioner is found guilty of misconduct in connection with any proceeding under the GST Law. Discontinuation/Closure of Business Change in Constitution leading to change in PAN are ceased to be liable to pay tax. Transfer of business on account of amalgamation, merger/demerger, sale, lease or otherwise disposed of etc. Death of Sole Proprietor. Composition person has not furnished returns for three consecutive tax periods. Registration has been obtained by means of fraud, wilful misstatement or suppression of facts. Etc. R. Srivatsan, IRS Further, Paying Guest Services should not to be confused with Exemption under Clause 12, Notification No. 12/2017 (Central) Services by way of renting of residential dwelling for use as residence. Actually, Residence as per (Black Law’s) Dictionary is Living or dwelling in a certain place permanently or for a considerable length of time. Therefore, Paying Guest Services not to be Confused with Above notification and is a Taxable Supply. Being related to immovable property, Place of Supply in terms of Section 12 of the CGST Act 2017 is Place at which the immovable property is located and if located outside India then location of the recipient. The SAC code for Paying Guest Service is 996322 and attracts 18% GST. Any contra opinion? 02 GST UPDATEZ - 14-12-2018 Whether paying Guest service is taxable or should be treated as supply of service related to residential dwelling ? I replied that the expression “supply” includes under Section 7 of CGST ACT 2017, all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; Hence Paying Guest Services Accounts Supply of Services as Per Section 7 of CGST act 2017.

Some of the Key decisions taken by the Council are as follows. Major Amendment in GST Law. a Central Advance Ruling Authority will be formed to resolve two conflicting rulings provided by State AARs 5% GST on Air Tickets for Economy Class for Pilgrims. 12% on Premium Tickets. Group of Ministers (GoM) to study Issues of Low Revenue in some States. Only Luxury and Sin Products in 28% Slab Now. Out of this, rates of 6 Items reduced Today. GST on Movie Tickets reduced. 12% GST on Tickets up to 100 and Rs. 18% on Tickets valuing more than 100 Rupees. 30000 crores given as Compensation to States in last 6 months. GST on Video Games and Sports Items reduced to 18%. 12% GST on Third-Party Insurance carrying Vehicles. Composition Scheme to be restricted for small traders only. Threshold Limit for Scheme will also be modified. Final Decision in Next Meeting. Natural Calamity Cess: Final Decision in Next Meeting. R. Srivatsan, IRS GST UPDATEZ- 22-12-2018 The 31st GST Council meeting chaired by the Union Finance Minister; Arun Jaitley is concluded in New Delhi. Services supplied by banks to PMJDY to be exempted from GST Services by Banks to Basic Savings Deposit Accounts, PMJDY exempted from GST. The due date for filing GSTR-9 / 9A and reconciliation statement in FORM GSTR-9C for the Financial Year 2017 – 2018 is extended till 30.06.2019. Among other things, these clarificatory changes shall be carried out in the following formats/instructions according to which the annual return/reconciliation statement is to be submitted by the taxpayers: 1.Amendment of headings in the forms to specify that the return in FORM GSTR-9 &FORM GSTR-9A would be in respect of supplies, etc. ‘made during the year’ and not ‘as declared in returns filed during the year’; Impact: GSTR-9 should be Consolidation of Actuals and not consolidation of what was declared in Returns – GSTR-1 and GSTR 3B. 2. Before taxpayers file the FORM GSTR-9 & FORM GSTR-9C they must fill the FORM GSTR-1 & FORM GSTR-3B. Impact: GSTR-1 and GSTR 3b filing is mandatory and complete the periodical process of filing these returns. Only after this GSTR-9 shall be filed. 03 GST UPDATEZ- 31-12-2018 IMPACT ANALYSIS on Annual Returns

4.HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies. Impact: This is similar to the concept of Principle Input under ER-5 an Annual Return in CENVAT Credit Rules. This is in line with the provisions prescribed under Rule 9A of CENVAT credit Rules 2004 (Ref: Explanation for Definition of Principal Inputs). Now, the HSN wise code need to be given only for those Inputs whose cost constitutes 10% or more of the total cost attributable to inward supplies. All other inputs can be aggregated as “Others” and no need to mention the HSN classification details. 5. If any additional payments are to be made, they can be done through the FORM GST DRC-03 in cash only. Impact: This means any additional liabilities declared here under Annual Returns cannot be discharged using ITC, only Cash payments are permitted. ITC cannot be availed through FORM GSTR-9 &FORM GSTR-9C; 6.All invoices pertaining to previous FY (irrespective of the month in which such invoice is reported in FORM GSTR-1) would be auto-populated in Table 8A of FORM GSTR-9; Impact: This will reflect the Total ITC available for the registered Recipient based on the GSTR-1 of their Suppliers (Whether included in the relevant FY or Subsequent FY) which is an Auto Populated non editable field. From which the eligible and non-eligible credits will be decided by the recipient registered person. This will also facilitate proper IGST settlement of funds to the consumption state where ITC has not been availed. 7.Value of “non-GST supply” shall also include the value of “no supply” and may be reported in Table 5D, 5E and 5F of FORM GSTR-9. 04 R. Srivatsan, IRS Impact: This will reflect Activities mentioned in Schedule – III which are neither treated as Supply of Goods nor Services, and treated as No-Supplies. This is over and above non-GST supplies like Liquor and 05 Petro products.

Authored ByR. Srivatsan, IRS Compiled ByA. Siva Superintendent of Customs TUTICORIN 2019

1.Notification 67/2018-Central Tax, dt. 31- 12-2018- Seeks to extend the time period specified in notification No. 31/2018-CT dated 06.08.2018 for availing the special procedure for completing migration of taxpayers who received provisional IDs but could not complete the migration process 2. 68/2018-Central Tax, dt. 31-12-2018 - Seeks to extend the time limit for furnishing the return in FORM GSTR-3B for the newly migrated taxpayers. 3. 69/2018-Central Tax, dt. 31-12-2018- Seeks to extend the time limit for furnishing the return in FORM GSTR-3B for the newly migrated taxpayers. 4. 70/2018-Central Tax, dt. 31-12-2018 Seeks to extend the time limit for furnishing the return in FORM GSTR-3B for the newly migrated taxpayers. 5. 71/2018-Central Tax, dt. 31-12-2018- Seeks to extend the time limit for furnishing the details of outward supplies in FORM GSTR-1 for the newly migrated taxpayers 6. 79/2018-Central Tax, dt. 31-12-2018 - Seeks to amend notification No. 2/2017 - Central Taxes dated 19.06.2017. 7. 78/2018-Central Tax, dt. 31-12-2018- Seeks to extend the due date for furnishing FORM ITC-04 for the period from July, 2017 to December, 2018 till 31.03.2019. R. Srivatsan, IRS GST UPDATEZ ON 01-01-2019 THIRTEEN (13) Notifications has been issued by the CBIC on the last day of the year 2018 to give effect to 31st GST Council Meeting Recommendations 8. 77/2018-Central Tax, dt. 31-12-2018 - Seeks to fully waive the amount of late fees leviable on account of delayed furnishing of FORM GSTR-4 for the period July, 2017 to September, 2018. 9. 76/2018-Central Tax, dt. 31-12-2018 - Seeks to specify the late fee payable for delayed filing of FORM GSTR-3B and fully waive the amount of late fees leviable on account of delayed furnishing of FORM GSTR-3B for the period July, 2017 to September, 2018 in specified cases. 10. 75/2018-Central Tax, dt. 31-12-2018 - Seeks to fully waive the amount of late fees leviable on account of delayed furnishing of FORM GSTR-1 for the period July, 2017 to September, 2018 in specified cases. 11. 74/2018-Central Tax, dt. 31-12-2018 - Fourteenth amendment to the CGST Rules, 2017. 12. 73/2018-Central Tax, dt. 31-12-2018 - Seeks to exempt supplies made by Government Departments and PSUs to other Government Departments and viceversa from TDS. 13. 72/2018-Central Tax, dt. 31-12-2018 - Seeks to extend the time limit for furnishing the details of outward supplies in FORM GSTR-1 for the newly migrated taxpayers. 05 GST UPDATEZ ON 02-01-2019 Non-filers and Stop filers cannot generate E Way Bills, if returns have not been furnished for consecutive Tax periods 138E. Restriction on furnishing of information in PART A of FORM GST EWB01.- Notwithstanding anything contained in sub-rule (1) of rule 138, no person (Including a consignor, consignee, transporter, and ecommerce operator or a courier agency) shall

be allowed to furnish the information in PART A of FORM GST EWB-01 in respect of a registered person, whether as a supplier or a recipient, who, — (a) being a person paying tax under section 10, has not furnished the returns for two consecutive tax periods; or (b) being a person other than a person specified in clause (a), has not furnished the returns for a consecutive period of two months. Provided that the Commissioner may, on sufficient cause being shown and for reasons to be recorded in writing, by order, allow furnishing of the said information in PART A of FORM GST EWB 01, subject to such conditions and restrictions as may be specified by him. Here the Commissioner means jurisdictional Commissioner under whom the taxpayer has been assigned. This is a very important change brought forth vide Notification No.74/2018, dt. 31- 12-2018. 06 R. Srivatsan, IRS Click here to read full document GST UPDATEZ ON 03-01-2019 In one of the panel discussions the following query was raised to me. Whether supplies to Duty Free Shops (DFS) are taxable or not under GST? Should it not be treated as Export? In my opinion it is Taxable and cannot be treated as Export of goods for following reasons. As per Section 2(5) of the Integrated Goods and Services Tax Act, 2017, “export of goods” with its grammatical variations and cognate expressions, means taking out of India to a place outside India. Further, as per Section 2(56) of Central Goods and Services Tax Act, 2017 “India” means the territory of India as referred to in Article 1 of the Constitution, its Territorial Waters, Seabed and Sub-oil underlying such waters, Continental Shelf, Exclusive Economic Zone (EEZ) or any other maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976, and the air space above its territory and territorial waters. For the purpose of CGST Act, India extends upto the Exclusive Economic Zone upto 200 nautical miles from baseline. The location of the DFS, whether within customs frontier or beyond, shall be within India as long as it is not beyond EEZ (200 nautical miles). So, DFS cannot be said to be located outside India. Instead, the DutyFree Shops (DFS) is construed to be located within India. The supply to a DFS by an Indian supplier is not to ‘a place outside India’, therefore, such supplies do not qualify as ‘export of goods’ under GST. Consequently, such supplies cannot be made without payment of tax by furnishing a bond/letter of undertaking (LUT) under rule 96-A of the CGST Rules, 2017. Also, they cannot claim refund of unutilized input tax credit (ITC) under Section 54 of the CGST Act, 2017.They shall be supplied only on payment of GST (Intrastate or interstate) as the case may be. Any contra opinion? GST UPDATEZ ON 04-01-2019 In terms of Sr. No. 5 of Circular No.76/50/2018-GST dated 31.12.2018, Government has clarified that the correct valuation methodology for ascertainment of GST on Tax collected at source (TCS) under the provisions of the Income Tax Act, 1961 and the taxable value for the purposes of GST shall include the TCS amount collected under

the provisions of the Income Tax Act since the value to be paid to the supplier by the buyer is inclusive of the said TCS.” Ok, that be the case, now, A close perusal of the above provision read with the provisions of Section 15(2) will lead to an inescapable conclusion that only taxes, duties, fees and charges which are “levied” under any law shall be added to the transaction value. The word “levied” denotes the tax which has been imposed on the supplier who is making the supply. Hence it covers all kinds of taxes imposed on the supplier but charged separately on the invoice and thus has to be added to the transaction value. So, now the question is can TCS be regarded as tax “levied” on the supplier? Relevant portion of Sec. 206C of the Income Tax Act, 1961 which contains provisions for TCS should be read in cognizance with Section 15(2) of the CGST Act 2017. Above provision under Income tax Act 1961 shows that TCS is merely collected from the buyer. TCS should be understood as a deposit amount paid by the seller on behalf of the buyer. Sec. 206(6A) further provides that the TCS is not required to be deposited in certain circumstances i.e. where buyer has already declared income and paid tax thereon. The levy of income tax is thus on the buyer only. Hence TCS cannot be construed as a tax which is “levied” under any law on the supplier. So, it is felt that GST cannot be imposed on a value that includes the TCS amount. What’s the take? 07 R. Srivatsan, IRS Click here to read full document GST UPDATEZ ON 06-01-2019 GST UPDATEZ ON 07-01-2019 RCM on Security Services has been introduced in GST by the Government vide Notification No. 29/2018-Central Tax (Rate) dated 31.12.2018. TDS liability u/s 51 of CGST Act, 2017 has come into force w.e.f. 01-10-2018. Now "NO” TDS shall be deducted where there is supply between the following persons – 1. Dept of Central or State Govt 2. Local Authority 3. Govt Agencies 4. Authority or a board or any other body, set up by an Act of Parliament or a State Legislature; or established by any Government, with 51% or more participation by way of equity or control, to carry out any function; 5.Society established by the Central Government or the State Government or a Local Authority under the Societies Registration Act, 1860 (21 of 1860); 6.PSUs One may recall that earlier only supplies from PSU to PSU and by Ministry of defense was exempted from TDS provisions. Notification No. 73/2018, CT. RCM on Security Services

W.e.f. 01.01.2019, any registered person receiving Security services (services provided by way of supply of security personnel) from any person other than a body corporate is required to pay GST on reverse charge basis. However, Govt Department/Establishment/ Agency who have taken registration under GST only for TDS purpose and those paying tax under Section 10 (Composition Scheme) are not required to pay GST on RCM basis. Therefore, if any registered person is receiving security services from any security agency (other than body corporate) he is required to pay GST on RCM basis w.e.f. 01.01.2019. 08 R. Srivatsan, IRS Click here to read full document GST UPDATEZ ON 08-01-2019 GST UPDATEZ ON 09-01-2019 An Amendment to Section 50 of the CGST Act has been made to provide that interest should be charged only on the net tax liability of the taxpayer, after taking into account the admissible input tax credit, i.e. interest would be leviable only on the amount payable through the electronic cash ledger. Interestingly this amendment on interest will apparently have retrospective effect. The amendment proposed is taking into consideration of the available precedent. The interest is only on financial accommodation received. That being the case the amount a registered person is required to pay is after ITC adjustment. Therefore, the interest liability arises on the amount not paid to the government account. (i) the registered persons eligible to avail input tax credit could not claim the same in terms of provisions of section 16 because of missing invoices or debit notes referred to sub-section (4) within the stipulated time; (ii) the registered persons could not rectify the error or omission in terms of provisions of sub-section (3) of section 37 within the stipulated time, as a result, whereof certain difficulties have arisen in giving effects to the provisions of sub-section (4) of section 16 and sub-section (3) of section 37 which has now been relaxed. Interest on delayed payments Eligibility to Avail ITC for Financial Year 2017-18 till March 2019 In terms of the Order No. 02/2018-Central Tax, 31st December, 2018, every Registered person shall be entitled to take input tax credit after the due date of furnishing of the return GSTR-3B under section 39 for the month of September, 2018 (i.e., 25th October 2018) till the due date of furnishing of the return under the said section for the month of March, 2019 (i.e., 20th APRIL 2019) in respect of any invoice or invoice relating to such debit note for supply of goods or services or both made during the financial year 2017-18, the details of which have been uploaded by the supplier under sub-section (1) of section 37 (GSTR1) for the month of March, 2019. In the new taxation system due to lack of familiarityClick here to read full document GST UPDATEZ ON 11-01-2019 Click here to read full document

09 R. Srivatsan, IRS GST UPDATEZ ON 15-01-2019 The Goods and Services Tax (GST) council in its 32nd meeting announced interalia the new limit for registration under GST to be Rs40 lakh. This is a major decision to help small taxpayers ((MSMEs) to go out of the tax net and hence the related compliances and costs. The main issues, which will have to be kept in mind on account of this change are: 1.Next Year: This limit is applicable from financial year 2019-2020 onwards only.... i.e. for financial year starting from 1st April 2019. 2.Goods, Not Services: The limit is applicable only for supply of goods. For service providers limit continues to be Rs. 20 lakhs for all states except for special states where it is Rs10 lakh. 3. Not for Interstate Sales: There limit is not applicable if an entity is selling goods interstate i.e. from one state to another. 5. Matters referred to Group of Ministers: i.A seven Member Group of Ministers shall be constituted to examine the proposal of giving a Composition Scheme to Boost the Residential Segment of the Real Estate Sector. ii.A Group of Ministers shall be constituted to examine the GST Rate Structure on Lotteries. 6. Revenue Mobilization for Natural Calamities: GST Council approved Levy of Cess on Intra-State Supply of Goods and Services within the State of Kerala at a rate not exceeding 1% for a period not exceeding 2 years. Threshold Limit for taking GST registration increased to Rs.40 lakhs with certain condition GST Council in its 32nd Meeting held on 10-01-19, in New Delhi took the following major decisions – 1.Increase in Turnover Limit for the existing Composition Scheme: The limit of Annual Turnover in the preceding Financial Year for availing Composition Scheme for Goods shall be increased to Rs 1.5 crore. Special category States would decide, within one week, about the Composition Limit in their respective States. The compliance under Composition Scheme shall be simplified as now they would need to file one Annual Return but Payment of Taxes would remain Quarterly (along with a simple declaration). 2.Higher Exemption Threshold Limit for Supplier of Goods: There would be two Threshold Limits for exemption from Registration and Payment of GST for the suppliers of Goods i.e. Rs 40 lakhs and Rs 20 lakhs. States would have an option to decide about one of the limits within a weeks’ time. The Threshold for Registration for Service Providers would continue to be Rs 20 lakhs and in case of Special Category States at Rs 10 lakhs. 3.Composition Scheme for Services: A Composition Scheme shall be made available for Suppliers of Services (or Mixed Suppliers) with a Tax Rate of 6% (3% CGST +3% SGST) having an Annual Turnover in the preceding Financial Year up to Rs 50 lakhs. The said Scheme Shall be applicable to both Service Providers as well as Suppliers of Goods and Services, who are not eligible for the presently available Composition Scheme for Goods. 4. The decisions at above shall be made operational from the 1st of April, 2019.

10 R. Srivatsan, IRS The revenue department has set up an officers committee to integrate e-way bill, FASTag and Delhi Mumbai Industrial Corridor’s (DMIC) Logistics Data Bank (LDB) services, after consultation with transporters as the next step forward. The department is already aware that some transporters are doing multiple trips by generating a single e-way bill. Integration of e-way bill with FASTag would be a way forward and help find the location of the vehicle and when and how many times it has crossed NHAI's toll plazas, disincentivising evasion. The GST e-way bill system is likely to be integrated with NHAI's FASTag mechanism from April 2019, to help track movement of goods and check GST evasion. 4. Amendments: GST being a dual tax (Central and State), the threshold limit for turnover will have to be changed in both the Acts. This will have to be done for each State (SGST), (UTGST) and in Central Goods and Services Act, 2017 as well. 5. Registration: Section 24 of GST Act makes compulsory to register in certain circumstances, and this section is not amended. Hence, if a small businessman is registered due to that, then he will have to continue with existing registration. Like may be Exporters and those supplying through E-Commerce platforms like Flipkart, Amazon, Snapdeal will have to continue with their registration. 6. A Clarity on Service Income may be helpful: If a person is selling goods has even small service income like rent for product placements at his shop / outlet i.e. space marketing whether limit of Rs.20 lakhs or Rs.40 lakhs will be applied to him is the question? To illustrate, a person may have supply of goods of Rs. 25 lakhs and rental income (Supply of Service) of Rs. 5 lakhs, now whether he will be covered by new exemption limit. Since increase in limit is for goods only and there no separate limit for goods and services for aggregate turnover. Once registered, GST has to be charged on all outward supplies whether goods or service. This limits the benefits for pure Supplier of Goods only. 7. Turnover Calculation: Section 22 of GST Act uses the word aggregate turnover (taxable goods plus taxable services plus exempt/nil rated goods plus exempt/nil rated services) while describing persons who are liable for registration. Hence, small shop owners will have to see their turnover in totality before deciding to complications. Could possibly errode state's tax base? GST UPDATEZ ON 16-01-2019 GST UPDATEZ ON 17-01-2019 E-Way Bill Exempted if value is less than 1 lakh Just like Tamil Nadu and some other states Bihar has also notified on 16-01-2019 that the e-way bill in respect of movement of goods originating and terminating in the State of Bihar shall not be required to be generated where the consignment value does not exceed One Lac Rupees." This notification comes into force with effect from 21st January, 2019. Most of the States including West Bengal, Delhi, Tamil nadu & Maharashtra etc., have double threshold for electronic-way (e-way) bill, viz., for intra-state movement of goods to Rs 1 lakh while for interstate movement the threshold limit is 50k.

The amount of 1% that the dealer collects from the purchaser of a car worth more than ten lakhs, under Section 206C(1F) of the Income Tax Act, cannot be treated as an integral part of the value of the goods and services supplied by the dealer. The dealer of the motor vehicle, acts only as an agent for the State to collect the income tax under Section 206C(1F). And that amount will eventually go to the vehicle purchaser’s credit. Earlier CBIC has clarified vide Circular No. 76/50/2018-GST dated 31st December, 2018 that taxable value for the purposes of GST shall include the TCS amount collected under the provisions of the Income Tax Act since the value to be paid to the supplier by the buyer is inclusive of the said TCS. Against this clarification a writ was filed and Kerala High Court has put on hold the computation of GST on TCS amount till disposal of the petition. R. Srivatsan, IRS GST UPDATEZ ON 22-01-2019 PSN Automobiles Private Limited Vs. UOI & CBIC (Kerala High Court at Ernakulam) is an important judgement in the current context. matter of Bipson Surgical (India) Pvt Ltd versus Gujarat State Government and Gujarat Medical Services Corporation (GMCL) that no price revision will be allowed under the contract due to change in the tax structure after introduction of Goods and Services Tax (GST). Grant of any relief as prayed due to upward revision of GST rates, would tantamount to varying terms and conditions of the contract document which under Article 226 of the Constitution of India shall not be permissible in the absence of Price Variation Clause / revision clause in the contract. The Bench observed that if the GST would not have been introduced while VAT and excise duty would have been continued to be levied and the rate of VAT and excise duty have been increased, then liability to pay enhanced tax was always upon the supplier and as per the tender document the claim of price revision of any goods under any pretext or reason including the revision of the duty/excise/cost will not be allowed. Accordingly, the Bench declined to accept the plea to revise the price to sync. with change in tax rate. (In this case from 5% to 12%). What I feel is that this decision will have wide ramification for the industry. There is a generally accepted feeling between the supplier and the receiver that change in tax structure will trigger change in prices under an agreement, but this ruling by the Gujarat High Court has just opposite expression and has smashed the misconceived myth. In my opinion, this ruling, once again underlines the fact that contracts should be appropriately worded to ring-fence revision on account of unforeseen future regulatory changes. Recourse cannot be taken of any change in tax regime unless the contract includes adequate tax clause, change in law clause etc., to cover the same with a special emphasis. I feel that the spirit of Article 226 has been rightly interpreted. Any contra opinion? 11 Click here to read full document GST UPDATEZ ON 27-01-2019 No price revision allowed under the contract due to change in the tax rate Click here to read full document The Division Bench of Gujarat High Court interestingly said in its recent ruling in the

The term "Corpus Fund" has not been defined in the GST Acts 2017. It is understood to be an amount donated by a donor with a specific direction that it shall form part of the Corpus of the Trust or institution. The corpus is considered to be the capital of the trust or institution which should be kept intact. Well let me deal with it in totality. Firstly, as Per GST law, construction of complex, building, Civil Structure or part thereof intended for sale to buyer, wholly or partly, except where entire consideration is received after issuance of completion certificate by required authority, is a supply of service. No GST on Ready to Move-in or completed property (Sch II of CGST Act, 2017)- Sale of immovable property. For Under Construction Property where amount paid for Purchase of Flat: Before 01/07/2017- Service tax is applicable at 4.5% (based on factored value) on Invoices raised or amount paid for Purchase of Flat. After 01/07/2017 - GST at 12%, while builder is eligible to avail full Input Tax Credit (ITC) of Goods or Services for Paying Output Tax. Now coming to the question on hand, Corpus fund is also known as maintenance fund. The term “Corpus” literally means main part or organ of the body. Normally corpus fund or maintenance fund denotes a permanent fund R. Srivatsan, IRS GST UPDATEZ ON 02-02-2019 Whether "Corpus Fund” is liable for GST? kept for the basic expenditure needed for the survival of the organization. Corpus fund is generally not allowed to be utilized for the attainment of the purpose; but interest or dividend on such fund can be utilized. For example, an amount of say Rs 1.5 lakhs for 2 years will be collected from each apartment buyer as Building Corpus Fund and the interest earned on this fund will be utilized for payments to the Facilities Management company. Many mid-size builders collect funds to manage the maintenance fund till the society is formed. The Builder shall transfer the corpus fund to the Association after its formation. Therefore, I opine that it is to be treated only in nature of Deposits taken from house owners, thus it should not amount to supply of services. The AAR (Maharashtra) decision vide Order No. 24, dated 01-08-2018 is not in consonance with this opinion though the circumstances are slightly different. I don't endorse it. Any contra opinions on this? 12 GST UPDATEZ ON 03-02-2019 1. Upper limit of turnover for opting of composition scheme shall be raised from Rs. 1 Cr to Rs. 1.5 Cr. 2. A Composite dealer (in goods) shall be allowed to supply services (other than restaurant services), for a value not exceeding – Higher of 10% of turnover in the preceding financial year, or Rs. 5 lakhs. Major GST Amendments applicable w.e.f. 01-02-2019

9. Input tax credit would now be available in respect of the following: - •Most of the activities or transactions specified in Schedule III; •Motor vehicles for transportation of persons having seating capacity of more than thirteen (including driver), vessels and aircraft; •Services of general insurance, repair and maintenance in respect of motor vehicles, vessels and aircraft on which credit is available; and •Goods or services which are obligatory for an employer to provide to its employees, under any law for the time being in force. 10. Registered persons may issue consolidated credit/debit notes to a party in respect of multiple invoices issued in a Financial Year to that party. 11. Commissioner may extend the time limit for return of inputs and capital sent on job work, upto a period of 1 year and 2 years, respectively. 12. If RBI would permit, Supply of services outside India shall be regarded as exports, even if payment is received in Indian Rupees. 13. Place of supply shall be outside India, where job work or any treatment or process has been done on goods temporarily imported into India and then exported out of India without putting them to any other use in India except the uses which were necessary for the purpose of such job work or treatment or process. 14. Recovery of taxes, interest, fine, penalty etc. can be made from distinct persons, even if such distinct persons are present in different State/Union territories. 13 R. Srivatsan, IRS 3. The threshold limit of Turnover for exemption from registration in the States of Assam, Arunachal Pradesh, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand shall be increased to Rs. Twenty Lakh (20 Lakhs) from Rs. Ten Lakh (10 lakhs). 4. In case of purchase of notified goods from unregistered suppliers, Reverse charge mechanism shall be applicable to notified registered persons. i.e., RCM applicable without any exemption limit w.e.f 01-02-2019 for a class of registered persons in respect of supply of specified categories of goods or services or both received from an unregistered supplier as per Notification No.01/2019 – Central Tax (Rate) and amended section 9(4) of CGST Act. But mind you, till the date neither class of registered persons nor specified categories of goods prescribed by the Govt. so until and unless notified RCM will not applicable. This is just an empowerment. 5.Taxpayers may opt for multiple registrations within a State/U. T in respect of multiple places of business located within the same State/U. T on the same PAN. 6. Mandatory registration is required for only those e-commerce operators who are required to collect tax at source. 7. Registration shall be remain temporarily suspended while cancellation of registration is under process, so that the taxpayer could get relief of further continued compliance under the law. (i.e. Taxpayers will not be required to file returns). 8. The following transactions shall not treat as supply (i.e. no tax payable under GST) under Schedule III: - •Supply of goods from a place in the nontaxable territory to another place in the non-taxable territory without such goods entering into India; •Supply of warehoused goods to any person before clearance for home consumption; and Supply of goods in case of high sea sales. GST UPDATEZ ON 04-02-2019 Just for academic interest,

admit the appeal by issuing the final acknowledgement or reject the application. In case Appellate Authority fails to issue final acknowledgement to the appellant within the stipulated time, then a system generated final acknowledgement will now be issued to the appellant with a remark “subject to validation of certified copies” 4. Release of API related to Assessment and adjudication. Following API released a. Assessment of non-filers of Returns b. Summary Assessment c. Rectification of mistakes 5. Removal of validation of 2% in Form GSTR-7. At the time of filing of Form GSTR7, as of now, system checks if total amount deducted is 2% of the taxable value or not. This check in table 3 and 4 in Form GSTR-7 is removed now. TDS Deductor will be free to report any value under CGST, SGST or IGST columns. System will not check if the amount reported is 2% of the amount paid to the deductee or not and if the CGST and SGST are deducted equally or not. Same is implemented in offline utility also. 6. Population of data from EWB system into Form GSTR-1. Taxpayers can now easily import details of outward supply invoices, as indicated in the e-way bill, at the time of preparation of Form GSTR-1, by clicking the “import EWB Data” button, on the GST portal. 14 R. Srivatsan, IRS The total gross GST revenue collected in the month of January, 2019 is Rs 1,02,503 crore of which CGST is Rs 17,763crore, SGST is Rs 24,826 crore, IGST is Rs 51,225 crore (including Rs 24,065crore collected on imports) and Cess is Rs 8,690 crore (including Rs 902crore collected on imports). In FY 2018-2019, it is for the third time that GST Revenue collection has crossed One Lakh Crore. The total number of GSTR 3B Returns filed for the month of December up to 31st January, 2019 is 73.3lakh. GST UPDATEZ ON 14-02-2019 The government has amended CGST Act 2017 vide CGST Amendment Act 2018 with various changes w.e.f and one of the important impacts making amendment was made in Section 49 of CGST Act by introducing new section 49A after the section 49, which is as under: GST UPDATEZ ON 08-02-2019 GSTN has made following updates to GST Portal 1. List of Preferred Banks list while making Payment. Every time a taxpayer makes GST Payment using a bank, it will be updated in the Preferred Banks list for that taxpayer. Up to 6 Preferred Banks will be shown to a taxpayer while making e-Payment on GST Portal. 2. Monthly Refund applications by Quarterly GSTR-1 filers. The restriction for applying refund on quarterly basis for quarterly GSTR 1 filer is removed. These tax payers can now file refund application on monthly basis, if Form GSTR 1 for the quarter is filed. 3. Auto approval of appeals filed by Taxpayer or Tax Department Application for appeal has to be submitted by the Appellant (Tax payer or Tax Department) to the First Appellate Authority. The Appellant also needs to submit certified copies within 7 days from the date of application or within the time limit allowed. The Appellate Authority may either admit the appeal by issuing the final acknowledgement or reject the application. 49A. Notwithstanding anything contained in section 49, the input tax credit on account of central tax, State tax or Union territory tax shall be utilized towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilized fully towards such payment

Supplier need to Pay Rs 1,00,000 from its cash register despite of having ITC available but under a different head IGST liability of Rs 2,00,000 set off from IGST ITC CGST liability of Rs 2,00,000 set off from remaining IGST ITC of Rs 1,00,000 and CGST ITC of Rs 1,00,000 SGST liability of Rs 2,00,000 set off from SGST ITC of Rs 1,00,000 and rest liability of Rs 1,00,000 will be paid in cash. The idea seems to be to ensure that the SGST portion of IGST credit is apportioned to the states then and there. Could lead to few Audit points in future. 15 R. Srivatsan, IRS Section 49 (5) of CGST Act 2017 speaks about manner of utilising Input Tax Credit (ITC) for payment of GST output Tax liability, e.g. IGST can be Set off against IGST and then CGST and SGST, CGST cane be set off against CGST and then against IGST, and SGST can be set off against SGST and then against IGST. The impact of said amendment (Sec. 49 A) is illustrated with this example comparing the pre and post amendment scenarios. Let’s take a situation where supplier for February 2019 has following data w.r.t liabilities and ITC availabilities for filing GST 3B. Output tax liability IGST- Rs 2,00,000 CGST-Rs 2,00,000 SGST-Rs 2,00,000 Total-Rs 6,00,000 ITC Available IGST- Rs 3,00,000 CGST-Rs 2,00,000 SGST- Rs1,00,000 Total- Rs 6,00,000 Before 01.02.2019 set off was as under: NO TAX IS TO BE PAYABLE IGST liability of Rs 2,00,000 set off from IGST ITC CGST liability of Rs 2,00,000 set off from CGST ITC SGST liability of Rs 2,00,000 set off from remaining IGST ITC of Rs 1,00,000 and SGST ITC of Rs 1,00,000 After 01.02.2019 (Section 49A) set off was as under: GST UPDATEZ ON 15-02-2019 From April 1, all the States (barring Kerala and Telangana), and two Union Territories (with assemblies Delhi and Puducherry), will have higher annual threshold limits for mandatory registration for GST for goods suppliers. There is no change in the limit for service providers. The GST Council, in its meeting on January 10, had decided that there would be two threshold limits for goods suppliers — ₹40 lakh (for the bigger States apart from Himachal Pradesh, Assam and J&K) and ₹20 lakh (for the states with special status). At present, these limits are ₹20 lakh and ₹10 lakh, respectively. It was also decided that the States would have a week to decide on one of the two limits. The threshold for registration for service providers would continue to be ₹20 lakh, and in the case of Special Category States, ₹10 lakh.

receipt of only specified categories of goods or services or both. It is important to note here that still the Government has not notified the specified class of registered person and the specified categories of goods or services or both to whom the provisions of reverse charge are applicable. Therefore the status quo is still maintained as on date. 16 R. Srivatsan, IRS Two UTs and all the 29 States were asked to select their option — whether to raise the limit or maintain status quo. It was a one-time exercise meant mainly to benefit micro, small and medium enterprises (MSMEs.) Meanwhile, it has been clarified that the States have time till March 31 to select their option and inform the Centre about it. The insertion of the provisions relating to the suspension of GST registration should be considered a welcome step for the GST registered taxpayer. With the insertion of suspension provisions, all those taxpayers who have applied for cancellation of GST registration would be relieved from the continuous compliance burden under the GST law during the period when the cancellation proceedings are under process. The following are the two amendment which is being done in the Act and the rules with regard to the suspension of GST registration 1. Proviso inserted in section 29 of the CGST Act, 2017; and 2. New rule 21A introduced in the CGST Rules, 2017. GST UPDATEZ ON 18-02-2019 Misconceived perception of RCM under Sec:9(4) from February 2019: In terms of the Central Goods and Service Tax (Amendment) Act, 2018 effective from 1st February, 2019, entire section 9 (4) of the CGST Act, 2017 was substituted. Now, let us understand what the substituted provisions of section 9 (4) says – ‘The Government may, on recommendations of the Council, by notification, specify the class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay tax on reverse charge basis as a recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both. There are lot of queries, false understanding and misguided notions that the RCM with reference to Receipts from URP has returned to fold with effect from 01-02-2019. To make the points clear, as per the earlier provisions, all the transactions of the supply of taxable goods or services or both from an unregistered person to registered person were covered under reverse charge basis. However, the new provisions have limited its ambit and the applicability of reverse charge mechanism would be restricted only to the specified class of registered person and on receipt of only specified categories of goods or services or both. GST UPDATEZ ON 19-02-2019 New Provisions regarding Suspension of GST Registration with effect from 1st February, 2019: The deeming provision of suspension of GST registration shall be effective when the registered person has applied for the cancellation of GST registration. The effective date of suspension of GST registration would be later of the following –

companies) other than electricity transmission or distribution utility’ are taxable. Please also refer to Circular No. 34/8/2018-GST Dt: 1st March 2018. (SL.No.4) for Miscellaneous services. An electricity transmission or distribution utility has also been defined in Indian Electricity Act 2003. It includes the following 1. The Central Electricity Authority; 2. A State Electricity Board; 3.The Central Transmission Utility (CTU); 4. A State Transmission Utility (STU) notified under the Electricity Act, 2003; 5. A distribution or transmission licensee licensed under the said Act; 6. Any other entity entrusted with such function by the Central or State Government; Further, the following services are also taxable under GST @ 18% as Supply of Services by DISCOMs. i. Application fee for releasing connection of electricity, ii.Rental Charges against metering equipment, iii.Testing fee for meters/ transformers, capacitors etc, iv.Labour charges from customers for shifting of meters or shifting of service lines, v. Charges for duplicate bill. vi.LT/HT application for new Service Connection vii.LT/HT Category Change/Load Change/ Name Changes/ Meter Testing Charges are Taxable. Developmental Charges will also be liable for GST and DISCOMs are collecting Developmental Charges along with the GST from all classes of consumers like LT consumers & HT consumers. 17 R. Srivatsan, IRS •Date of submission of registration cancellation application or •Date from which the cancellation is sought. On suspension of GST registration – •Such a person cannot make any taxable supply after suspension of GST registration; •Such a person is not required to furnish any returns as required under section 39 of the Central Goods and Service Tax Act, 2017. The main benefit of the suspension of GST registration, from the point of view of the registered person, is that he would be freed up from the return compliance under GST. Once the proceeding of cancellation of GST registration is being completed by the proper officer, the suspension of GST registration shall be revoked. The revocation of suspension of GST registration shall be effective from the date on which the suspension had come into effect GST UPDATEZ ON 20-02-2019 A very interesting question posed during one of the sessions was Whether electricity Charges are taxable under GST? Well, as per the notification No. 12/2017 (Central Rates) Dt: 28th June, 2017 under the entry no.25 – ‘Transmission or distribution of electricity by an electricity transmission or distribution utility’ are taxable under GST @ ‘NIL’ rate. So, the first answer is that it is Taxable but attracts Nil rate. However, supply of services rendered by be DISCOMs (electricity distribution

It has become a compulsive business practice to use various promotional tools to increase the sale of their products. These tools range from 1.discounts, 2.free samples, 3.cashbacks, 4.warranty supplies, 5.extra quantity of the products, 6.extra units of the products and 7.various vouchers that can be exchanged for the availment of concessions on purchase of goods and services in future. While the use of these promotional schemes is indispensable in today's era of cut throat competition, it is also essential to understand the indirect tax implications with respect to the same, especially driven by the fact that the GST is an advelorem based levy where value becomes paramount. In most of the promotional schemes the common observation is that they are either in the nature of free supplies or in the nature of discounts, regardless of the fact how it is presented or perceived by the customers. While the definition of supply requires the existence of consideration in order for a transaction to constitute a supply, certain transaction listed under Schedule I of the CGST Act, 2017 are covered under the ambit of supply even when carried out without consideration. The chargeability of tax on the promotional schemes in the nature of free supplies need to be examined in accordance with Schedule I of the Act. Further, implications of discounts will have to be examined in accordance with Section 15 (Value of Supply) of the CGST Act 2017. Further, the tax implications with respect to these promotional schemes need to be examined in the light of restrictions of input tax credit, also as blocked credits in terms of Section 17(5) of the CGST Act 2017. I have perceived and attempted to give my Updates on some of the common promotional schemes that are used by businesses. R. Srivatsan, IRS GST UPDATEZ ON 22-02-2019 In deviation of the regular method I intend that One scheme is to be discussed daily on continuous basis TO KEEP THE CURIOSITY QUOTIENT AND EXPECTATIONS HIGH for the next 7 days starting from 22-02-2019 (Friday) till 28-02-2019 (Thursday). First is 1. Free Samples 18 GST UPDATEZ ON 22-02-2019 The practice of free samples is usually practiced for newer products to penetrate the market. These samples are usually distributed to unrelated persons without any consideration. It is imperative to note that only supplies to related persons without consideration are covered under Schedule I of the Act. Hence, the distribution of free samples to unrelated persons shall not come under the ambit of 'Supply' as per Section 7 of the CGST Act, 2017 ('Act'). Hence, no GST is required to be paid on the activity of distribution of free samples. However, the input tax credit of goods distributed as free samples shall be disallowed in accordance with Section 17(5) of the Act. Tollywood actor Mahesh Babu's AMB Cinemas receive notice for violating GST norms Tollywood actor Mahesh Babu's multiplex AMB cinemas received a show cause notice from the Ranga Reddy district GST Commissionerate in Telangana for the violation of GST norms. AMB Cinemas, located at Kondapur in Telangana, was reportedly selling tickets at higher rates despite the reduced tax rate from January 1 as per the new norms from this year and Mahesh Babu-owned AMB cinemas returned the additional profit of Rs 35lakh to

the consumer welfare fund. GST officials appreciated the move. AMB was alleged to have broken the anti-profiteering clauses of GST by not reducing ticket prices. But how RS. 35 lakhs were arrived? God only knows Anyway, it's proactive. R. Srivatsan, IRS Further, no reversal of credit is also required in respect of the extra units/quantity being offered extra, because apparently the cost of which is already included in the Value of supply. 19 GST UPDATEZ ON 24-02-2019 In continuation of my earlier Updatez on 22, 23rd February 2019 the next freebee scheme that is being taken is: 1. Providing Free Gifts to distributors as a business Promotion activity. GST UPDATEZ ON 23-02-2019 In continuation of my earlier Updatez on 22-02-2019, the next freebee scheme that is being taken is: 1. Extra Units/Quantity of the Same Product: The provision of an extra unit/quantity of the same or similar product is quite an efficient marketing strategy to entice the customers. This practice is commonly used by FMCG companies and retail shopping outlets especially w.r.t commonly used regular items. For example- 1 plus 1 offers/20% extra quantity offers on shampoos, hair oils, biscuits etc. In this case, the cost of the 1 free unit/extra quantity of shampoo etc., is generally included in the sale price of the 1 unit for which the customer is paying. Such schemes are introduced to give to the buyer an incentive to purchase more quantity at a lesser price indirectly by giving something free. Hence, offering extra units/quantity of the same product is in the nature of discounts. This discount or the value of free article/extra quantity which is known at the time of recognition of supply shall not be included in the transaction value of supply so as to compute GST liability (Section 15). Hence, no GST is required to be paid on the notional value of the extra unit/quantity of the product being offered as a promotional tool as it is in the nature of discount in a different form. Many companies offer free gifts to distributors on meeting certain targets to incentivize the distribution process. These goods may be manufactured (or taken from their inventory) by the company itself or may be procured from outside also. For example, companies offer household appliances like television, mobile, etc, to distributors on meeting sales targets. The tax implications in this regard need to be examined in the light of the second entry of Schedule I which is as under: "Permanent transfer or disposal of business assets where input tax credit has been availed on such assets" It must be noted that the essential condition here is the availment of input tax credit in respect of the goods. In case input tax credit is availed on any goods being distributed as gifts, the transaction shall be covered under the ambit of supply and tax shall be levied. However, Section 17(5) disallows the availment of input tax credit in case of goods being distributed as gifts. Hence, ITC shall be disallowed on such goods being distributed as gifts to the distributors. And, in the absence of availment of ITC, the transaction shall not be covered under the definition of supply.

20 R. Srivatsan, IRS GST UPDATEZ ON 26-02-2019 In continuation of my earlier Updatez on 22, 23, 24 & 25th February 2019, the next freebee scheme that is being taken is: GST UPDATEZ ON 25-02-2019 In continuation of my earlier Updatez on 22, 23, 24th February 2019, the next freebee scheme that is being taken is: 4. Supply under warranty: It is a general practice in major electronic goods industries, automobile industries to offer warranties on the sale of their products. A warranty is basically an undertaking by the manufacturer to the end-customer wherein all defects on account of faulty manufacture of the goods have to be repaired and the faulty parts in the product shall be replaced free of cost to the customer. This warranty may be the basic warranty for which no extra charges are paid by the customer. On the other hand, warranty may be extended warranty which is chargeable and is optional for the customer to purchase. 5. Cashback coupons Cashback coupons are the most common form of marketing strategy adopted nowadays. Vendors sell their products under different types of cashback schemes of which one is discussed today and two tomorrow. Cashback coupons in product packaging. Under this scheme, the product that is being supplied to a customer contains a cashback coupon in it. The cashback coupon, provided by the supplier, offers instant cashback to the customer to enable the customer to reduce the cost of the products purchased. While this cashback may be in the nature of discount, such discount shall not have the effect of reducing the value of supply. As per Section 15, of the CGST Act 2017, only discounts offered at the time of supply shall be reduced from the taxable value, which would have been duly recorded in the invoice during the course of transaction. The amount of cashback coupons offered in the product packaging can never be mentioned in the invoice as the amount to be collected from the customer is not the price of the product when reduced by the amount of cashback. In the event where goods are supplied to the customer under warranty, no consideration is charged for the replacement of parts or the provision of repair services. In such a case, the transaction between unrelated persons shall not be covered under the definition of supply and no tax shall be chargeable. At this juncture, it is also relevant to ponder upon the fact that when such goods were purchased by the customer, the value of supply included the value of goods and services that may be supplied under warranty (on an approximate basis). Hence, in this case the question of levying tax on the goods and services supplied under warranty should not arise. Further, there is no restriction on the availment of ITC on goods or services supplied under warranty, hence, no reversal of credit is required. However, supplies made during the optional extended warranty cannot be viewed through the same lens. The amount collected from the customer shall be the entire price of the product. Cashback is only a consequence after the supply. Hence, the amount of cashback can be held to represent just the marketing expenses of the supplier and has no impact of reducing the GST liability.

21 R. Srivatsan, IRS GST UPDATEZ ON 27-02-2019 In continuation of my earlier Updatez on 22, 23, 24,25 & 26th February 2019, the next freebee scheme that is proposed to be analysed is: 6. Cashback coupons provided by Person other than supplier - Take the case of certain E-Commerce operators like Flipkart, Paytm and amazon etc, who offer various cashbacks to customers on the purchase of products that are available on their website. These cashback coupons are not provided by the supplier (of goods or services) and the expenditure in this regard is borne by the ECommerce operator himself primarily to increase his customer base on their website. These freebies have no role in marketing the goods or services but primarily increases the hits in the respective websites and improve its patronage. In this case, the customer who buys a product or service, is required to pay the entire price of the product and only subsequent to the purchase the cashback amount is credited in his (electronic) wallet. Since, this type of cashback is (also) discount offered at the time of sale but, which cannot be recorded on the invoice issued the supplier (as the supplier has nothing to do with the cashback), such cashback shall not have the effect of reducing the GST liability at the supplier's end. Continuing with this, let's see 7. Gift Vouchers valid on subsequent purchase Illustration- Let's say a Beauty Parlour offers a discount voucher of Rs. 500 on availing services worth Rs. 2,000 but with the condition that the same can be used on the subsequent visit only. On the first visit, the question of reducing the discount of Rs.500 should not arise and the taxable value shall be Rs. 2,000 only. However, on the subsequent visit, if the customer wants to avail of the discount of Rs. 500, it has to be seen whether the discount can be reduced from the taxable value or not? As per Section 15, any discounts given after the supply have been affected shall be reduced from the taxable value only where such discount can be traced with respect to specific invoices issued in the past and such discount is established according to the terms of a contract. In our example, if the discount can be linked to the earlier invoice, a credit note can be issued and, hence, it is opined Rs. 500 can be reduced from the taxable value on the second visit. No impact on ITC. Hence, no GST is required to be paid on the free article being offered as a promotional tool. Further, there is also no requirement to reverse the input tax credit in this regard. It can be seen from the discussions over the past one week that different promotional schemes have different tax implications and therefore it is imperative for businesses entity as well as the Tax authorities like us to examine the same to arrive at the correct cost of the This marketing strategy is used by the supplier of goods or services to encourage recurrent sales of their goods or services. Under this scheme, the customer is given a discount voucher that can be availed on the subsequent purchase of the goods or services. GST UPDATEZ ON 28-02-2019 In continuation of my earlier Updatez on 22, 23, 24, 25 26, 27th February 2019, the next freebee scheme that is being taken is:

promotional tools being used, calculate the tax liability as required and avoid future litigation. A new and novel attempt was made to take one aspect of GST, i.e., VALUE over a period of 07 days starting from last Friday (22nd) till today (28th- Thursday) to keep the interest surviving for one week and hope it triggered the purpose. 22 R. Srivatsan, IRS Act, the UTGST Act and the GST (Compensation to States) Act, if charged separately by the supplier." Earlier it was opined that the TCS collected under Income Tax Act 1961 should form part of this value. But now, it has been clarified that For the purpose of determination of value of supply under GST, Tax collected at source (TCS) under the provisions of the Income Tax Act, 1961 would not be includible as it is an interim levy not having the character of tax. This issue was nagging the taxpayers, who are liable for TCS deduction under Income Tax Act 1961, for some time, which now has been resolved. The new return formats named normal, Sahaj and Sugam, would make the compliance process simpler for the smaller business entities, wherein taxpayers up to a turnover of Rs 5 crore would have an option to file any of the three forms. For the departmental officers, the new formats would help in matching the invoices of the seller and the purchaser, on real time basis and would act as a self-policing mechanism to check evasion to a great extent. It is seen that HSN-wise details need to be provided at the invoice level rather than the summary level. In addition, while details at 4-digit HSN codes are required in the current format, the new format would need those details at the 6-digit HSN level. Under the new format, invoices can be reported on a continuous basis. The provisions Section 15(2) of CGST Act specifies that the value of supply for the purpose of calculating GST liabilities, shall include “any taxes, duties cesses, fees and charges levied under any law for the time being in force other than this Act, the SGST GST UPDATEZ ON 10-03-2019 New returns from April 2019 GST UPDATEZ ON 06-03-2019 The functionality for filing the Annual return has been made available in portal, though the last date for filing the same is 30-06- 2019. It can also be filed using offline utility. Alert......GSTR-9 once filed cannot be revised. GST UPDATEZ ON 08-03-2019 Please refer to the series of GST UPDATEZ by me from 22-28 Feb 2019 on valuation of freebies. On the similar lines a circular has been issued on 07-03-2019. Click here to read full document GST UPDATEZ ON 09-03-2019 In a one more step which is fair, proactive and justifiable, the Government has come up with a Corrigendum to Circular No. 76/50/2018-GST dated 31st December, 2018 issued vide F.No. CBEC-20/16/04/2018- GST- Reg. Finally clarified no GST on TCS!!! Click here to read full document

23 R. Srivatsan, IRS The intent is to facilitate for genuine taxpayers with a simple compliance mechanism and they will just file it and forget it. 1.Persons required to take compulsory registration under section 24 (Example – Online Sale E-Commerce Operator). 2. Persons engaged in supply of Ice Cream and other edible ice, whether or not containing cocoa, Pan Masala, Tobacco and manufactured tobacco substitutes. Threshold Limit for Registration (SERVICES): Provisions Before 1st April 2019: Threshold Limit for Registration in case of Services engaged in making Supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand is Rs. 10 lakhs Threshold Limit for Registration in case of Services except persons engaged in making Supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand will be Rs. 20 lakhs. Please note Assam is not in the list. Provisions After 1st April 2019: Threshold Limit for Registration in case of Services except persons engaged in making Supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand is Rs. 20 lakhs. For Tamil Nadu and Puducherry, the threshold limit for Goods will be Rs.40 lakhs while for services it will be Rs. 20 lakhs. GST UPDATEZ ON 21-03-2019 (Part-II) GST UPDATEZ ON 20-03-2019 (Part-1) Part-1 on Threshold Limit for Registration today and Part-2 on Composition Levy on 21-03-2019. There has been a radical change in both Registration limits and Composition levy scheme from 1st April 2019. I have attempted to emphasis the change in comparison with what is available now and what will be available from 01-04-2019. Threshold Limit for Registration (GOODS): Provisions Before 1st April 2019: Threshold Limit for Registration in case of goods (all over India) except persons engaged in making Supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand is Rs. 20 lakhs Provisions After 1st April 2019: Threshold Limit for Registration in case of goods (all over India) except persons engaged in making Supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand will be Rs. 40 lakhs. Threshold Limit for Registration in case of Goods where Rs. 40 lakhs are not applicable in following cases: - I intend to put GST updatez on two topics In continuation of my earlier UPDATEZ on 20-03-2019, this PART-II is on Composition Levy.

24 R. Srivatsan, IRS Provisions Before 1st April 2019: The threshold turnover limit.... v For Trader, Manufacturer – Rs. 1 Crore v For Restaurant Service Only – Rs. 1 Crore The Rate – For Trader, Manufacturer – 1% For Restaurant Service– 5%. Provisions after 1st April 2019: The threshold turnover limit v For Trader, Manufacturer – Rs. 1.5 Crore v For Restaurant Service – Rs. 1.5 Crore v For Other Service Providers subject to threshold limit of turnover in the preceding Financial Year Rs. 50 lakhs it is also Rs.1.50 crore. The Threshold limit in any of the following States, namely: – (i) Arunachal Pradesh, (ii) Manipur, (iii) Meghalaya, (iv) Mizoram, (v) Nagaland, (vi) Sikkim, (vii) Tripura, (viii) Uttarakhand: is Rs.75 lakhs. The Rate – For Trader, Manufacturer – 1% For Restaurant Service – 5%. For Other Service Providers whose turnover in the preceding Financial Year Rs. 50 lakhs – 3% CGST & 3% SGST Applicability of Composition Scheme- • Not engaged in making any supply which is not leviable to tax under the CGST Act. • Not engaged in making any interstate outward supply. • Neither a Casual Taxable Person nor a Non-Resident Taxable Person • Not engaged in making any supply through an e-commerce operator who is required to collect tax at source under section 52 •Shall not collect any tax from the recipient on supplies made by him nor shall be entitled to any credit of ITC •Shall issue Bill of Supply instead of Tax Invoice. The registered person under composition scheme shall mention the following words at the top of the bill of supply namely – “Taxable Person paying tax in terms of Notification No. 2/2019 –Central Tax (Rate) dated 07.03.2019, not eligible to collect tax on supplies”. The composition opted will continue to file GSTR-4 even if new Returns are notified. The time limit for furnishing the details of outward supplies in FORM GSTR-1 under the Central Goods and Services Tax Rules, 2017, by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or the current financial year, for each of the months from April, 2019 to June, 2019 has been notified vide Notification No. 12/2019- CT, to be till the eleventh day of the month succeeding such month and For those registered persons having aggregate turnover of up to 1.5 crore rupees in the preceding financial year or the current financial year, the time line for filing Form GSTR-1 for the period from April 2019 to June 2019 has been notified vide Notification No. 11/2019 CT as 31st July 2019. Further vide Notification No.13 /2019, CT the return in FORM GSTR-3B for each of the months from April, 2019 to June, 2019, shall be furnished electronically through the common portal, on or before the twentieth day of the month succeeding such month. GST UPDATEZ ON 23-03-2019 Time lines for filing returns

25 R. Srivatsan, IRS On the aspect of Payment of taxes for discharge of tax liability as declared under FORM GSTR-3B, every registered person furnishing the return in FORM GSTR-3B of the said rules shall, subject to the provisions of section 49 of the said Act, discharge his liability towards tax, interest, penalty, fees or any other amount payable under the said Act by debiting the electronic cash ledger or electronic credit ledger, as the case may be, not later than the last date specified (20th of succeeding) on which he is required to furnish the said return. However, if the bank has already paid CGST/SGST or CGST/UTGST as the case may be, such banks shall not be required to pay IGST towards such supply. 1.Now E-waybill system is being enabled to auto calculate the route distance for movement of goods, based on the Postal PIN codes of source and destination locations. 2.One E-way Bill policy is followed, Now Blocking of generation of multiple E-Way Bills on one Invoice/document 3.Now, validity of E Way Bill can be extended in case Consignment when in Transit 4.Blocking of Interstate Transactions for Composition dealers More Details about the changes and how it is being perceived will be discussed in Part 2 and Part 3 tomorrow 28-03-2019 and day after tomorrow 29-03-2019. GST UPDATEZ ON 27-03-2019 New Changes proposed in GST E-Way Bill: with effect from 25-03-2019. In terms of Circular No. 93/12/2019-GST, CBIC, has clarified the nature of Supply of Priority Sector Lending Certificates (PSLC). Please recall that, vide Notification No. 11/2018-Central Tax (Rate) dated 28.05.2018 GST was levied on PSLC trading on reverse charge basis from 28.05.2018 onwards to be paid by the buyer bank. GST UPDATEZ ON 24-03-2019 Clarification with respect to nature of supply of priority sector lending certificates (PSLC) by banks Earlier, vide Circular No. 62/36/2018-GST dated 12.09.2018 it was clarified that GST on PSLCs for the period 1.7.2017 to 27.05.2018 will be paid by the seller bank on forward charge basis and GST rate of 12% will be applicable on the supply. Now, it has been clarified that nature of supply of PSLC between banks may be treated as a supply of goods in the course of inter-State trade or commerce. Accordingly, IGST shall be payable on the supply of PSLC traded over e-Kuber portal of RBI for both periods i.e. 01.07.2017 to 27.05.2018 and from 28.05.2018 onwards. GST UPDATEZ ON 28-03-2019 In continuation of the post Part 1 on 27-03-2019 the first two changes in the EWB system are discussed here today.

26 R. Srivatsan, IRS 1.Auto calculation of route distance based on PIN code for generating EWB: Now, E-waybill system is being enabled to auto calculate the route distance for movement of goods, based on the Postal PIN codes of source and destination locations. That is, the e-waybill system will calculate and display the actual distance between the supplier and recipient addresses. User is allowed to enter the actual distance as per his movement of goods. However, it will be limited to 10% more than the displayed distance for entry. That is, if the system has displayed the distance between Chennai and Coimbatore, based on the PIN codes, as 500 KMs, then the user can enter the actual distance up to 550 KMs (500 KMs + 50 KMs). In case, the source PIN and destination PIN are same, the user can enter up to a maximum of 100 KMs only. If the PIN entered is incorrect, the system would alert the user. However, he can continue entering the distance. Further, these e-waybills having INVALID PIN codes are flagged for review by the department. Route distance calculation between source and destination uses the data from various electronic sources. This data employs various attributes, like road class, direction, average speed, traffic data etc. These attributes are picked up from traffic that is on National highways, state highways, expressways, district highways as well as main roads inside the cities. A proprietary logic is then used for approximating the distance between two postal pin and distance thus derived is then provided as the motorable distance for that point of time. 2.Blocking of generation of multiple E-Way Bills on one Invoice/document: The government has now decided not to allow generation of multiple e-way bills based on one invoice, by any party – consignor, consignee and transporter. That is, once E-way Bill is generated with an invoice number, then none of the parties – consignor, consignee or transporter – can generate the E-Way Bill with the same invoice number. One Invoice, One E-way Bill policy is followed. This scheme is being brought into, based on the requests by various state governments. Part 3 will continue tomorrow. The transporters, their Associations and other stakeholders had represented to Government to incorporate a provision to extend the E-way Bill, when the goods are in transit. The transit means the goods could be on Road or in Warehouse. Considering their requests, the facility for extension in transit has been incorporated in the next version for the extension of E-way Bill. During the extension of the e-way bill, the user is prompted to answer whether the Consignment is in Transit or in Movement. On selection of In Transit, the address details of the transit place need to be provided. On selection of In Movement the system will prompt the user to enter the Place and Vehicle details from where the extension is required. In both these scenarios, the destination PIN will be considered from the PART-A of the E-way Bill for calculation of distance for movement and validity date. Route distance will be calculated as explained above. 4.Blocking of Interstate Transactions for Composition dealers: As per the GST Act, the composition tax payers are not supposed to do Interstate transactions. Hence next version will not allow generation of GST UPDATEZ ON 29-03-2019 (Part-3) In continuation of Part-1 on 27th and Part-2 on 28th I am discussing the remaining changes in EWB in Part 3 today. 3.Extension of E-Way Bill in case Consignment is in Transit:

27 R. Srivatsan, IRS e-way bill for inter-state movement, if the supplier is composition tax payer. Also, the supplies of composition tax payers will not be allowed to enter any of the taxes under CGST or SGST for intrastate transactions. In case of Composition tax payer, document type of Tax Invoice will not be enabled. than the revenue collected during the same period last year. The monthly average of GST revenue during 2018-19 is Rs. 98,114 crore which is 9.2% higher than FY 2017-18. The government today issued two notifications 17/2019 CT and 18/2019 CT, both dated 10-04-2019 and extended due date of filing GSTR 1 and GSTR 7 due date for the month of March 2019 from 11.04.2019 to 13.04.2019 for GSTR-1outward supply return for Tax payers whose Aggregate turnover is more than 1.50 crore and from 10.04.2019 to 12.04.2019 for GSTR 7 a return by TDS deductee under section 51. GST UPDATEZ ON 11-04-2019 Extension of time for filing GSTR1and GSTR-7 GST UPDATEZ ON 01-04-2019 The pilot project envisaged for rolling out simplified monthly GST return forms from April 1 has been deferred and the new forms would be made available once they the notified and the software is fully ready. The GST Council had in July last year decided that the simplified GST return forms — Sahaj and Sugam — would be rolled out on a pilot basis from April 1, 2019, while mandatory filing across the country would kick in from July 2019. GST UPDATEZ ON 02-04-2019 Total Gross GST revenue collected in the month of March 2019 is Rs. 1,06,577 crores of which CGST is Rs. 20,353 crores, SGST is Rs.27,520 crore, IGST is Rs.50,418 crore (including Rs. 23,521crore collected on imports) and Cess is Rs. 8,286 crores (including Rs. 891crore collected on imports). The total number of GSTR 3B Returns filed for the month of February up to 31st March, 2019 is 75.95 lakh. Revenue collection The collection during March, 2019 has been the highest since introduction of GST. The revenue in March, 2018 was Rs. 92,167crore and the revenue during March, 2019 is a growth of 15.6% over the revenue in the same month last year. The revenue for the last quarter in the year 2018-19 is 14.3% higher GST UPDATEZ ON 20-04-2019- -CONSTRUCTION SECTOR – PART-1 Over a period of 07 days starting from 20-04-2019 to 26-04-2019, (Part-1 to 7), I intend to discuss the latest GST Changes for Construction Sector 1. All the changes brought forth vide (06) Six Notifications No.3 to 8/2019-Central Tax (Rate) all dated 29th March, 2019 and have taken effect from 01-04-2019. 2. The earlier effective rate of GST (both CGST and SGST together) was 12 % with ITC (18% on two thirds value, after excluding one third

28 R. Srivatsan, IRS towards notional land value) {S.No. 3 (i) of Notification 11/2017} also 3.The earlier effective rate of GST (both CGST and SGST together) in respect of certain specified construction projects, covered under certain specified schemes was 8 % with ITC (12 % on two thirds value, after excluding one third towards notional land value) {S.No. 3 (iv) and 3 (v) and 3 (vi) of Notification 11/2017}. 4. Now, for the above two categories of projects, assesses can continue to pay the same rate of GST, with ITC after 01.04.2019 also. 5. Such option has to be exercised before 10.05.2019. 6.This is permissible only for “ongoing projects” as on 31.03.2019 and not for fresh projects after 01.04.2019. 7.For fresh projects commenced after 01.04.2019, the rate of GST would be 1 % for "affordable residential apartments" and 5 % for other residential apartments. 4. The principle behind this provision is that ITC would be available to the extent GST is payable at old rates upto 31.03.2019 and ITC would not be admissible to the extent GST is payable on 1 % or 5 %, as the case may be, post 01.04.2019. 5.Further, suitable mechanism has been provided to avoid any mischief in this regard, such as huge procurement of inputs prior to 31.03.2019, huge billing disproportionate to percentage of completion, huge billing without realisation before 31.03.2019, etc. The method of calculation of such reversal is actually a challenge and is being explained separately. GST UPDATEZ ON 21-04-2019- -CONSTRUCTION SECTOR – PART-2 .......Continued from Part-1 yesterday....... Click here to read full document To be continued in Part:2....... 1. “Affordable Residential Apartments” would mean those, having carpet area not exceeding 60 square meter in metropolitan cities or 90 square meter in cities or towns other than metropolitan cities and for which the gross amount charged is not more than Rs.45 Lakh rupees. Metropolitan cities have been defined in the notification itself. Click here to read full document To be continued in Part:3....... GST UPDATEZ ON 22-04-2019- -CONSTRUCTION SECTOR – PART-3 ......Continued from Part:2......... 1. A project where the commercial area is less than 15 % of the total area would also be considered as Residential Project and the rate of 5 % would be applicable even for the commercial area in such projects. 2. In projects, where the commercial area is more than 15 % of the total area, for the residential area, GST rate applicable would be 1 % or 5 %, as the case may be and for the commercial area, GST rate applicable would be 12 % (18 % on two thirds of the total value, after excluding one thirds towards land value). 3.Wherever 1 % (for affordable residential apartments) or 5 % (for other residential apartments) is opted for ongoing projects and compulsorily adopted for new projects, at least 80 % of the purchase of inputs and input services (other than services provided by land owners and purchase of petrol, diesel, natural gas and electricity) shall be purchased from Registered persons. 4. If there is any shortfall below 80 %, GST @ 18 % has to be paid by the Promoter on such shortfall value, under RCM.

29 R. Srivatsan, IRS 5.If Cement is received from unregistered person, Promoter has to pay GST at the rate applicable for cement, under RCM. 6.If capital goods are received from unregistered person, Promoter has to pay GST at the rate applicable for such capital goods, under RCM. 6.GST on TDR and Additional FST and on long term lease, payable by the Promoter in respect of commercial apartments is payable by the Promoter @ 18 %. 7.The time of supply for this would be the date of issue of Completion Certificate or first occupation whichever is earlier. The GST thus paid would be entitled for ITC. 8.For the apartments handed over to Landowners in terms of Joint Development agreements, Promoter is liable to pay GST on the basis of value of comparable apartments sold at nearest time, excluding the land / UDS land value at the time when such apartments are conveyed to the Landowners. GST UPDATEZ ON 23-04-2019- -CONSTRUCTION SECTOR – PART-4 .......Continued from Part:3........ Click here to read full document ........To be continued in Part:4....... 1.The transfer of development rights (TDR) and transfer of FSI by the landowners in favour of promoters, or obtaining land on long term lease basis from the landowners, would be a supply of taxable service, attracting GST. Such GST is payable by the promoter under RCM. 2. GST on TDR and Additional FSI payable by the Promoter in respect of residential apartments is exempted, where GST is paid on such residential apartments. 3. If any part of the apartments in the project are sold after completion, without payment of GST, to that extent, GST @ 1 % in respect of affordable residential apartments and @ 5 % in respect of residential apartments other than affordable residential apartments then GST on TDR is payable by the Promoter under RCM. 4.The time of supply for this would be the date of issue of Completion Certificate or first occupation whichever is earlier. 5. ITC of such GST cannot be taken as the subject residential apartments would be sold without payment of GST. GST UPDATEZ ON 24-04-2019- -CONSTRUCTION SECTOR – PART-5 ..... Continued from Part: 4...... Click here to read full document ......To be Continued in Part: 5...... SOME POINTS MAY BE REPEATED BUT STILL WORTH RECOLLECTION 1. An assessee can opt to continue with old rates with ITC for ongoing projects and pay @ 1 % or 5 % as the case may be, for new projects after 01.04.2019. In such case, no ITC can be taken in respect of the new project, but ITC can be taken for the ongoing projects. 2. No input tax credit except in certain circumstances, which have been allowed, specifically. 3. Reversal of ITC, pertaining to credit attributable to project, where time of supply is after 1st April 19 has been mathematically provided with standardised formulae. 4. The Developer / promoter pays tax on services provided (TDR) to land owner for construction of land pertaining to owner share. 5. 80% of value of input and input services should be received from registered supplier.

30 R. Srivatsan, IRS 6. Where in a financial year, such 80% threshold is not met, tax has to be paid by builder on shortfall @ 18%. 7. Cement purchased from unregistered supplier; the builder shall be liable to pay tax at applicable rates. 8. Promoter shall maintain project wise accounts for arriving 80% threshold and 9. Pay tax on shortfall by end 30th June of succeeding financial year 10.Tax on cement purchases from unregistered supplier has to be paid in month in which cement is received. whichever is earlier. ITC of such GST cannot be taken, as the subject residential apartments would be sold without payment of GST. 5.GST on TDR and Additional FST and on long term lease, payable by the Promoter in respect of commercial apartments is payable by the Promoter @ 18 %. The time of supply for this would be the date of issue of Completion Certificate or first occupation whichever is earlier. The GST thus paid would be entitled for ITC. GST UPDATEZ ON 25-04-2019- -CONSTRUCTION SECTOR – PART-6 ...... Continued from Part: 5....... Click here to read full document .......To be continued in Part: 6....... GST UPDATEZ ON 29-04-2019 (PART:3) Click here to read full document ......To be Continued in Part: 7...... 1.If capital goods are received from unregistered person, Promoter has to pay GST at the rate applicable for such capital goods, under RCM. 2.The transfer of development rights (TDR) and transfer of FSI by the landowners in favour of promoters, or obtaining land on long term lease basis from the landowners, would be a service, attracting GST.Such GST is payable by the promoter under RCM. 3. GST on TDR and Additional FSI payable by the Promoter in respect of residential apartments is exempted, where GST is paid on such residential apartments. 4. If any part of the apartments in the project are sold after completion, without payment of GST, to that extent, GST @ 1 % in respect of affordable residential apartments and @ 5 % in respect of residential apartments other than affordable residential apartments is payable by the Promoter under RCM. The time of supply for this would be the date of issue of Completion Certificate or first occupation 1. Where an assessee has opted to continue to pay @ 12 % or 8 %, as the case may be for certain on-going projects with ITC benefit, the portion of ITC attributable to those apartments which are not booked by the time of completion (which would be sold without payment of GST) shall be calculated for the entire project for the entire period and not only for the year in which completion happens. 2. For example, if the project commenced in 2017-18 and the assessee has been availing ITC since then. He has opted to pay 12 % GST with ITC for the said project. 3. The project is completed during 2019-20 and out of 50 residential apartments in the complex, 10 remain unsold at the time of issue of completion certificate. Such portion of total ITC availed since 2017-18 in respect of said In continuation of Part-1 on 27th and Part-2 on 28th I am discussing the remaining changes in EWB in Part 3 today.

i.e. 10/50th of the total ITC availed since 2017-18 shall be reversed. Earlier, such reversal would apply only for the ITC availed in the year 2019-20. 4. For the apartments handed over to Landowners in terms of Joint Development agreements, Promoter is liable to pay GST on the basis of value of comparable apartments sold at nearest time, excluding the land / UDS land value at the time when such apartments are conveyed to the Landowners. 5. An assessee can opt to continue with old rates with ITC for ongoing projects and pay @ 1 % or 5 % as the case may be, for new projects after 01.04.2019. In such case, no ITC can be taken in respect of the new project, but ITC can be taken for the ongoing projects. 31 R. Srivatsan, IRS balance tax liability has not been paid out of the same. Therefore, the outcome of delay in filing of returns for whatever reasons is that the payment of the tax liability partly in cash and partly in the form of a claim for ITC was made beyond the period prescribed. Therefore, the obligation to pay interest under Section 50 (1) arises automatically. Thus, if the return is not filed in time, there is no question of availing ITC, and consequently, the GST liability is at gross, and therefore, the interest gets levied on Gross GST Liability. The above view has been taken in the case of Megha Engineering & Infrastructures Ltd Vs Commissioner of Central Tax Hyderabad (Telangana High Court at Andhra Pradesh) GST UPDATEZ ON 27-04-2019 (PART:3) GST UPDATEZ ON 13-05-2019 Important Reminder on due dates for compliance in May 2019 Every Taxpayer needs to be vigilant in ensuring timeliness in the filing of GSTR-3B since delays in filings have implications of interest on gross GST liability The disappointment here arises from the fact that the GST Council in December 2018, confirmed the amendment of Section 50 of the CGST Act thereby allowing interest to be charged only on the net tax liability that is after taking into account the appropriate input tax credit. However, the referred approval by GST council is not being translated into a relevant amendment in the GST Act; The input tax credit on the goods or services received or availed, cannot be made available to the person unless there is a credit entry into the electronic credit ledger and the balance Due date of GSTR-6 (Apr, 2019) - May 13th, 2019 Due date of GSTR-3B (Apr, 2019) - May 20th, 2019 Due date of GSTR-5 (Apr, 2019) - May 20th, 2019 Due date of GSTR-5A (Apr, 2019) - May 20th, 2019 GST UPDATEZ ON 22-05-2019 The input tax credit on the goods or services received or availed, cannot be made available to the person unless there is a credit entry into the electronic credit ledger and the balance

32 R. Srivatsan, IRS One needs to stay up-to-date to avoid missing out on vital compliances. Here is a compilation of Latest Updates on GST Portal as of 05th MAY 2019. There are the top 10 facilities identified which will be discussed in two days (5 per day) PART-I 1. Comparison of liability declared and input tax credit claimed: This facility helps registered persons in comparing their GSTR-3B tax liabilities with the GSTR-1s that have been filed. Likewise, users can also compare their input tax credit claimed in the GSTR-3B with the credit available in GSTR-2A. There are also 4 different tabs under which data validation and comparison can be carried out- •Liability other than export/reverse charge •Liability due to reverse charge •Liability due to export and SEZ supplies •ITC credit claimed and due These are very useful functionalities that will help in reconciling the GST returns filed, as well as in the preparation of the annual return. The data is available for both financial years, 2017-18 and 2018-19. 2. GSTR-9 and GSTR-9A enabled for filing annual returns: •an order passed by an appellate authority •an advanced ruling by an appellate authority OR •an application to the appellate authority in the case of rectification of a mistake in an order. A system generated acknowledgement will be issued if the appellate authority fails to issue a final acknowledgement within the stipulated time. The system generated acknowledgement will bear the remark “subject to validation of certified copies”. 4. A taxpayer’s GSTIN can be entered while filing a refund application: Due to the inverted duty structure under GST, a refund application can be filed by a registered taxpayer for accumulated input tax credit. The portal has enabled the entry of a taxpayer’s own GSTIN in the inward supply detail statement, while filing the same on the GST portal. This option wasn’t previously available. 5. Quarterly-filers can file refund applications monthly: GSTR-9, the annual return form for normal taxpayers, and GSTR-9A, the annual return form for composition taxpayers have been recently enabled on the portal. Even though the due date has been extended till June 30, 2019 for filing the same, it is suggested not to wait till the last moment, but file the same as soon as possible. 3. Filing of Appeals can be done online: A taxpayer can now file an appeal online in the case of Tax filers who file their returns quarterly now do not have to wait for the quarterly filing of refund applications too. The portal has been enabled for monthly filing option of the same. However, in order to file the refund application, a user has to ensure that the GSTR-1 for the quarter has been filed. Businesses, especially SMEs, can mobilize their cash flows as they do not need to wait till the end of the quarter to apply for refund. To be continued on 23-05-2019 as Part II……………. GST UPDATEZ ON 23-05-2019 Continued from 22-05-2019…………………. Compilation of Latest Updates on GST Portal as of 05th MAY 2019. Part-2

33 R. Srivatsan, IRS While making GST payments, six preferred banks will now be available to a taxpayer to choose from. With this function on the portal, a user does not need to enter his bank details every time and can select the same from a drop-down menu. If a payment is made through a seventh bank account, then that bank account gets added, and the least used account gets removed. 10. Import E-way bill data to file GSTR-1: The GST Portal has been integrated with the E-way bill (EWB) portal, allowing taxpayers the seamless importing of data. Users can now import the B2B and B2C (large) invoices sections, as well as the HSN-wise-summary of outward supplies section automatically. Taxpayers can verify the data and then proceed, thus saving time and unnecessary data-entry. Compilation of Latest Updates on GST Portal as of 05th MAY 2019. Part-2 6. New window enabled for claiming TDS/TCS credits- The GST portal has enabled a new window for claiming TDS/TCS credits while filing GST returns. A taxpayer can accept or reject these credits, after which they get moved to the cash ledger. These credits can then be used for making GST payments. This function helps the taxpayers in identifying the credits available, and taking the required action. 7. Responding to show-cause notices for compulsory withdrawal: There is an easy way for Composition taxpayers to reply to show-cause notices that have been issued for compulsory withdrawal from the composition scheme. If a show-cause notice has been issued and if proceedings have been initiated, there is now the option to reply to the same on the portal. This saves time and has simplified responses for composition taxpayers. 8. Bank account details can be given any time after registration: For Normal, OIDAR and NRTP taxpayers, it is now optional to declare bank account details at the time of registration, and the same can be submitted later. Earlier, it was mandatory to submit these details at the time of registration, however, the same can now be given when logging in for the first time. Hence, for new business, this is particularly useful as a GST registration number can be obtained without the hassle of needing to open a bank account first. 9. Preferred (6) banks are now available while making payments: GST UPDATEZ ON 23-05-2019 Kerala to levy calamity cess up to 1% over and above GST w.e.f 01-06-2019. The Power to impose such a levy flow from Article 279(A) (4)(F) of the constitution. The Kerala Government will levy a 1 percent cess on the value of goods and services taxed at 12 percent, 18 percent and 28 percent and will be levied for two years, from 1st June 2019. The calamity cess will be levied only on the value of supplies made within the state by registered dealers, (intra state supplies only) which means the levy will be only on retail transactions. There is no intend to impose a cess on items that are taxed at 5 percent or below, except gold, silver and platinum ornaments. However, a cess of 0.25 percent will be levied on gold,

34 R. Srivatsan, IRS silver, platinum ornaments, precious stones, imitation jewellery, diamonds, among other items, that fall in the fifth schedule of GST rates. Small dealers who have availed the Composition Scheme, that allows taxpayers to pay a flat GST without the facility to avail input tax credit, are excluded from the levy. The prescription of this disaster cess only on B2C transactions appears to be a well thought move helping prevent a cascading impact of this additional levy. One is that the NAA should get a finite extension with a fixed timeline to clear cases, as was the objective initially. The other view is that the NAA may be needed for a longer time as certain items like petroleum and alcohol are yet to be brought under the GST ambit. The Council is also expected to deliberate and decide on inclusion of excluded sectors like oil & gas, real estate (constructed properties), electricity, etc, and rate rationalisation on cement. e-invoicing...... Deciding a fresh date for the rollout of simplified GST returns. The issue of plugging the loopholes in the GST law which is leading to tax evasion. We have to wait and watch! GST UPDATEZ ON 30-05-2019 GST UPDATEZ ON 29-05-2019 GST Council to meet early next month. The next meeting of the GST (goods and services tax) Council could take place as early as in first half of June after approval from the new finance minister. The focus will be on tackling the unfinished agenda requiring immediate attention like tax structure for solar projects (as per the directions of Delhi HC due to divergent views by AAR), uniform tax rate on stateorganised and state-authorised lotteries, (as recommended by Maharashtra) taxing nonpotable alcohol (as sought by Pharma industry to facilitate availability of ITC) besides certain changes in the law, extension for the National Anti-profiteering Authority (NAA) and rate rationalisation. The Council importantly take up the case for extension of the NAA’s tenure, which is coming to an end in November 2019. It appears that NAA through its Chairman has informally asked for an extension due to pending cases. The Council has asked the NAA for data on the number of orders passed and the status of pending cases, to come to a decision on extension. There appears to be two views on giving extension. SC agrees to examine power of tax authorities to arrest individual for GST evasion A vacation bench comprising Honourable Chief Justice and Honourable Justice Aniruddha Bose issued notice to the Centre and sought its reply on a batch of pleas challenging the provision of arrest under the CGST Act.

35 R. Srivatsan, IRS The Supreme Court on May 29, 2019 agreed to examine the powers of tax authorities to arrest an individual for Goods and Services Tax (GST) evasion. The bench said that different high courts had taken different views in granting anticipatory bail to individuals accused of GST evasion and therefore, it needs to decide the question of law on the power of arrest. The bench also asked all the high courts to keep in mind, while dealing with grant of anticipatory bail in GST evasion cases, its earlier order by which it had upheld the Telangana High Court verdict which had said that individuals can't be given protection from arrest in such cases. The bench listed the batch of petitions before a three-judge bench to decide the question of law on the power of arrest. Awaiting a landmark decision on this question of law. Also, the revenue in May, 2019 is 2.21 per cent higher than the monthly average of GST revenue in previous FY 2018-19 (Rs 98,114 crore). The growth in revenue collection has come at a time when industrial production has slowed down. Growth rate in Core sector (comprising of eight industrial sectors, steel, coal, electricity, cement, Refinery production, crude oil, natural gas and fertiliser) dropped to 2.6 per cent in April 2019. There are 72.45 lakhs assesses filed GSTR 3B (Liability return) for the month of April 2019 up to May 31, 2019. The government has settled ₹18,098 crore to CGST and ₹ 14,438 crore to SGST from IGST as regular settlement. The total revenue earned by Central Government and the State Governments after regular settlement in the month of May, 2019 is ₹ 35,909 crore for CGST and ₹ 38,900 crore for the SGST. An amount of ₹ 18,934 crore has been released to the states as GST compensation for the months of February-March, 2019. These are statistical indicators testifying the Progress and Performance of GST. While last two months had witnessed higher growth on account of year end collections, the increase vis-a-vis May 2018 signifies good growth. GST UPDATEZ ON 03-06-2019 GST UPDATEZ ON 02-06-2019 Gst revenue collections A thought about Kerala Flood Cess which has been levied for the first Time is discussed below. A few questions answered. According to Finance Ministry data, the total gross GST revenue collected in the month of May, 2019 is ₹ 1,00,289 crore of which CGST is ₹ 17,811 crore, SGST is ₹ 24,462 crore, IGST is ₹ 49,891 crore (including ₹ 24,875 crore collected on imports). Collection from cess was ₹ 8,125 crore (including ₹ 953 crore collected on imports). Just to have a comparison, the total Gross revenue in May, 2018 was ₹ 94,016 crore and the revenue during May, 2019 there is a growth of 6.67 per cent over the revenue in the same month last year.

36 R. Srivatsan, IRS The rates of Cess are as follows: Goods taxed at the rate of 1.5% KGST0.25% Cess Goods taxed at the rate of 6%,9% and 14% KGST-1% Cess All services under KGST-1% Cess When? All the taxable persons who engage in the supply of goods or services where the place of supply and the location of the supplier is in the state of Kerala. In other words, Intrastate Supply in Kerala would attract Kerala Flood Cess. Who need to pay? All taxable persons (registered persons and those who are liable to get registered) shall pay a cess for the intra-state supply of goods or services, where the recipient is an unregistered person. (B2C). He shall show the cess collected separately on the invoice and shall pay it to the Government. Who need not pay? i. Those registered persons who have opted to pay tax under the composition scheme u/s 10 of the KGST Act ii. Those taxable persons providing exempt supplies under the notification issued u/s 11 of the KGST Act. Value? The cess shall be paid on the taxable value of supplies (Section 15 Transaction Value) made by the taxable person to the unregistered person. How to discharge: The registered person shall deposit the cess along with the return for the cess within the due date for filing GSTR-3B (being 20th of the immediately succeeding month). The amount shall be paid by getting a one-time user-id and password from the official portal ‘www.keralataxes.gov.in” and epayment shall be made. Credit of Flood Cess: No credit is allowed on the cess paid as the same is levied on transactions between the unregistered end consumers and the taxable persons. B2B transactions are not covered in Kerala Flood Cess. Refund of Cess: Refund is not allowed of the cess paid to the Government. From When? Applicable from 1st July 2019. Hence, transactions taking place on or after 1st July 2019 shall be subject to cess as well. Sunset clause? This cess is applicable for a period of two years i.e. till 30.06.2021. There are some apprehensions about the valuation of GST after KFC, if it has to form part of Transaction value or not. I feel • KFC rules prescribe straight valuation mechanism for levy of the cess i.e. the taxable value as per the provisions GST Law. • However, there exist an ambiguity on the value to be considered for levy of GST (CGST+SGST) which is explained as under – • Section 15 of the CGST/Kerala SGST Act, provides for value on which GST is to be charged. • The said sections include any taxes, cesses, fees and charges levied under any law other than GST Law i.e. other that CGST, SGST, IGST and UTGST law. • Hence, by virtue of the above, THERE COULD BE AN OPINION THAT GST has to be levied on value KFC too, which is will result in cascading of taxes and also, the same is against the principles of taxation. The Rules could have been drafted taking powers straight from section 9 of the KGST Act instead of plainly drawing powers from the Kerala Finance Bill, 2019, as this levy is after getting the concurrence of the GST Council. This may have created some despondency over the quantum of CGST +SGST payable.

37 R. Srivatsan, IRS Now, the GST Council in its upcoming meeting which is expected to be scheduled in first fort-night of June 2019, hope will bring in better clarity on the valuation mechanism to be adopted. f the tax was paid through FORM GSTR-3B between April 2018 to March 2019 then such supply shall be declared in Pt. V of FORM GSTR-9. e) Any additional outward supply which was not declared by the registered person in FORM GSTR-1 and FORM GSTR-3B shall be declared in Pt. II of the FORM GSTR-9. Such additional liability shall be computed in Pt. IV and the gap between the “tax payable” and “Paid through cash” column of FORM GSTR-9 shall be paid through FORM DRC03. f) Many taxpayers have reported a mismatch between auto-populated data and the actual entry in their books of accounts or returns. One common challenge reported by taxpayer is in Table 4 of FORM GSTR-9 where details may have been missed in FORM GSTR-1, but tax was already paid in FORM GSTR-3B and therefore taxpayers see a mismatch between auto-populated data and data in FORM GSTR-3B. It may be noted that auto-population is a functionality provided to taxpayers for facilitation purposes, taxpayers shall report the data as per their books of account or returns filed during the financial year. g) Many taxpayers have represented that Table 8 has no row to fill in credit of IGST paid at the time of import of goods but availed in the return of April 2018 to March 2019. Due to this, there are apprehensions that credit which was availed between April 2018 to March 2019 but not reported in the annual return may lapse. For this particular entry, taxpayers are advised to fill in their entire credit availed on import of goods from July 2017 to March 2019 in Table 6(E) of FORM GSTR-9 itself. h) Payments made through FORM DRC-03 for any supplies relating to period between July 2017 to March 2018 will not be accounted for in FORM GSTR-9 but shall be reported during reconciliation in FORM GSTR-9C. It has also been advised that all the taxpayers may file their Annual Return (FORM GSTR-9) at the earliest to avoid last hour bottle neck. GST UPDATEZ ON 05-06-2019 Annual returns for 2017-18 The last date to file returns will continue as June 30, 2019. There will be no likely hood for a change in last date to file annual GST return as per Finance Ministry. Ministry has issued a detailed guidelines where GST assessees should keep the following issues in mind at the time of filing the return: a) Information contained in FORM GSTR-2A as on May 1, 2019 shall be auto-populated in Table 8A of FORM GSTR-9. b) Input Tax Credit on inward supplies shall be declared from April 2018 to March 2019 in Table 8C of FORM GSTR-9. c) Particulars of the transactions for FY 2017-18 declared in returns between April 2018 to March 2019 shall be declared in Pt. V of FORM GSTR-9. Such particulars may contain details of amendments furnished in Table 10 and Table 11 of FORM GSTR-1. d) It may be noted that irrespective of when the supply was declared in FORM GSTR-1, the principle of declaring a supply in Pt. II or Pt. V is essentially driven by when was tax paid through FORM GSTR-3B in respect of such supplies. If the tax on such supply was paid through FORM GSTR-3B between July 2017 to March 2018 then such supply shall be declared in Pt. II and if the tax was paid through FORM GSTR- 3B between July 2017 to March 2018 then such supply shall be declared in Pt. II and i

38 R. Srivatsan, IRS The GST Council, will meet on June 20, 2019 Thursday at New Delhi. This is the first meeting after new Government has taken charge and first for the new FM. The main agenda will be taking a final decision on the turnover threshold for issuance of e-invoice for B2B sales after consultation with states. Also to decide on roll out of new returns. No discussion proposed in the agenda about GSTR 9/9A/9C, which means no likely extension of dates. GST UPDATEZ ON 09-06-2019 GST UPDATEZ ON 21-06-2019 News flash The GST Council in its 35th meeting today 21-06-2019 decides to extend tenure of GST Anti-Profiteering Authority by two years. GST Council has also extended date for filing annual returns under GST by two months to 30 August, 2019 from the earlier June 30. New GST return filing system will be applicable from 1 Jan, 2020. I intend to discuss these changes in Three parts. Part-I Changes in Notification No:31/2019. Part-II Changes in other Notifications from Notification No: 26-32/2019 Part-III Clarifications issued by CBIC. First let me discuss the changes carried out Vide Notification No. 31/2019 – Central Tax Dated 28th June 2019, which amends CGST Rules 2017. 1.Rule 10A has been inserted - Taxpayers are required to furnish bank account information on the portal within 45 days of the grant of registration or the due date of GSTR-3B, whichever is earlier. Effective date - 28 June 2019; 2.Rule 21 has been amended- GST registration is liable to be cancelled of a person not furnishing the details required as per Rule 10A referred above. Effective date - 28 June 2019. GST UPDATEZ ON 30-06-2019 The Government has issued various notifications, Order and Circulars for implementing the decisions taken in the 35th meeting of the GST Council. 3.Rule 32A has been inserted - For the purpose of charging GST, the value of supply of good or services shall not include the value of Kerala Flood Cess charged thereon. Effective date - 01st July 2019. 4.Rule 46 and Rule 49 has been amended - A proviso has been inserted to provide the

39 R. Srivatsan, IRS requirement of Quick Response (QR) code on tax invoice and bill of supply, subject to certain conditions and restrictions, as may be specified. Effective date - To be Notified. 5.Rule 66(2), 67(2) and 87(9) has been amended - Rules relating to the procedure of claiming TDS / TCS deducted has been amended. Effective date - 28 June 2019. 6.Rule 87 has been amended – A new Subrule 13 has been inserted to provide that a registered person can transfer any amount of tax/interest/penalty/fee to any other head in the electronic cash ledger, in this regard, form GST PMT-09 has also been introduced. Effective date - To be Notified. 1Effective date - 28 June 2019. 10.Amendment to GSTR-9 format: Tables of Annual Return has been amended to provide the details from April 2018 to March 2019 instead of April 2018 to September 2018; Instructions of table 8A has been amended to provide that FORM GSTR-2A generated on 1 May 2019 shall be auto-populated in table 8A. Formats of Forms REG-01, REG-07, REG-12, GSTR-04, RFD-05 and DRC-03 have also been changed to suit the amendments. Effective date - 28 June 2019. I will continue with the updates on other Notifications on 01-07-2019 7.Rule 95A has been inserted - Rule 95A has been inserted to provide the refund mechanism to the retail outlets established in the departure area of an International Airport. In this regard, form GST RFD-10B has also been introduced. Effective date - 01st July 2019. 8.Rule 128, 129, 132 and 133 have been amended - Rules relating to antiprofiteering has been amended. Effective date - 28 June 2019. 9.Rule 138(10) and 138 have been amended - Proviso has been inserted to provide that the validity of e-way bill may be extended within eight hours from the time of its expiry. Rule 138E has been amended to provide that taxpayers claiming the benefit of notification number 02/2019-Central Tax dated 07 March 2019 shall not be allowed to fill form GST EWB-01 if the return has not been filed for two consecutive quarters. GST UPDATEZ ON 01-07-2019 In continuation of my earlier updates (Part I) yesterday i.e. 30-06-2019, most of the changes discussed today are Returns related and let me discuss the changes carried out Vide Notification No. 26/2019 – Central Tax Dated 28th June 2019. The time limit for furnishing of GSTR-7 for the months of October 2018 to July 2019 has been extended till 31 August 2019. This is a welcome news to all our AO (DDOs) who had missed earlier. Effective date - 28 June 2019. Notification No. 27/2019 – Central Tax Dated 28th June 2019 The time limit for furnishing of GSTR-1 for the taxpayers having a turnover up to 1.5 crores in current/preceding FY, for the period July to September 2019 has been extended till 31 October 2019. Effective date - 28 June 2019 Notification No. 28/2019 – Central Tax Dated 28th June 2019

40 R. Srivatsan, IRS The time limit for furnishing of GSTR-1 for the taxpayers having turnover more than 1.5 crores in current / preceding FY, for the months July to September 2019 has been prescribed as the 11th day of the month succeeding such month. Effective date - 28 June 2019 Notification No. 29/2019 – Central Tax Dated 28th June 2019 The time limit for furnishing of GSTR-3B, for the months July to September 2019 has been prescribed as the 20th day of the month succeeding such month. Effective date - 28 June 2019 Notification No. 30/2019 – Central Tax Dated 28th June 2019 Suppliers of Online Information Database Access and Retrieval Services (‘OIDAR services’) has been given exemption from the furnishing of Annual Return / Reconciliation Statement. This comes as a great relief for this Sector as the Government has progressively considered the demand from such Service Providers. Effective date - 28 June 2019 Notification No. 32/2019 – Central Tax Dated 28th June 2019 The time limit for furnishing GST ITC-04, in respect of goods dispatched to a job worker or received from a job worker, during the period from July 2017 to June 2019 has been extended till 31 August 2019. Effective date - 28 June 2019 I will continue with the updates on Clarifications issued on 02-07-2019 in part III. GST UPDATEZ ON 02-07-2019 Circular No. 105/24/2019-GST dated 28 June 2019: Post-sale discount given by the supplier of goods to the dealer without any further obligation or action required at the dealer’s end Such discount is related to the original supply of goods and not to be included in taxable value, while Additional Discount as a post-sale incentive, offer a special reduced price to the customer will be treated as a separate transaction and the discount will be treated as consideration for undertaking such activity. The customer, if eligible, can claim the ITC benefit of GST paid on such additional discount. However, for Discounts granted by the supplier but not excluded from the value of supply, the dealer will not be required to reverse ITC attributable to the tax already paid on such post-sale discount received by him through the issuance of financial/commercial credit notes by the supplier of goods. In continuation of my earlier updates 30-06-2019(Part I) and 01-07-2019 (Part II) most of the changes discussed today are Clarifications issued by CBIC.... Circular No. 104/24/2019-GST dated 28 June 2019: Clarification has been issued regarding the processing of refund applications in FORM GST RFD-01A submitted by taxpayers whose jurisdiction has been wrongly mapped on the common portal. Circular No. 103/24/2019-GST dated 28 June 2019: Clarification has been issued regarding the determination of place of supply in the following cases: a) Services provided by Ports and b) Services rendered on goods temporarily imported in India. Circular No. 102/24/2019-GST dated 28 June 2019: Clarification has been issued regarding the levy of GST on additional/penal interest on account of delay in payment of EMI. The Circular gives an extensive explanation and illustration regarding the applicability of GST levy on additional/penal interest on account of delay in payment of EMI.

It may be noted that invoices etc can be uploaded in FORM GST ANX-1 on a continuous basis both by large and small taxpayers from October 2019 onwards. FORM GST ANX - 2 may be viewed simultaneously during this period but no action shall be allowed on such FORM GST ANX-2. Furthermore, for October and November 2019, large taxpayers would continue to file FORM GSTR-3B on monthly basis. They would file their first FORM GST RET-01 for the month of December, 2019 by January 20, 2020. Similarly, the small taxpayers would stop filing FORM GSTR-3B and would start filing FORM GST PMT-08 from October 2019 onwards. They would file their first FORM GST-RET01 for the quarter of October 2019 to December 2019 from 20th January, 2020. From January 2020 onwards, all taxpayers shall be filing FORM GST RET-01 and FORM GSTR-3B shall be completely phased out. Offline utilities have also been made available on the portal. 41 R. Srivatsan, IRS The due date for annual GST compliances for FY 2017-18 [i.e. submission of Annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C (Audit report)] extended till August 31, 2019, vide Removal of Difficulty Order No. 6/2019 dated 28 June 2019. There are (03) three main components to the new return — one main return FORMGST-RET-1 & two annexures FORM GST ANX-I and FORM GST ANX-2. Between July 2019 to September 2019 (for three months), the new return system (ANX1 & ANX-2 only) would be available on trial basis for taxpayers to make themselves familiar. This trial, would have no impact at the back end on the tax liability or input tax credit of the taxpayer. In this period, taxpayers shall continue to fulfil their compliances by filing FORM GSTR-1 and FORM GSTR-3B on a monthly /quarterly basis and return non-filing of these returns shall attract penal provisions under the GST Act. From October 2019 onwards, FORM GST ANX-1 shall be made compulsory and FORM GSTR-1 would be replaced by FORM GST ANX-1. The large taxpayers (i.e. those taxpayers whose aggregate annual turnover in the previous financial year was more than Rs. 5 Crore) would upload their monthly FORM GST ANX-1 from October 2019 onwards. However, the first compulsory quarterly FORM GST ANX-1 to be uploaded by small taxpayers (with an aggregate annual turnover in the previous financial year up to Rs. 5 Crore) would be due only in January 2020 for the quarter October to December 2019. GST UPDATEZ ON 02-07-2019 The new GST Return System A. Reduction in the GST rate on supply of goods and services: (1) The GST rate on all electric vehicles be reduced from 12% to 5%. (2) The GST rate on charger or charging stations for Electric vehicles be reduced from 18% to 5%. GST UPDATEZ ON 27-07-2019 The 36th GST Council meeting was held today by video conferencing and the Council has recommended:

The Finance Bill 2019 presented in the Parliament as part of Budget Proposals 2019 has been passed to give effect to the financial proposals of the Central Government for the financial year 2019-2020. This bill has received the assent of the President of India on the 1st August, 2019, and is hereby made available below as THE FINANCE (NO. 2) ACT, 2019 (NO. 23 OF 2019) for general information. Please take note that this contains all the proposals put forth during budget including Direct Taxes, Customs etc., and not GST in isolation. Reference File: finance-no-2-act-2019 receives-president.pdf 42 R. Srivatsan, IRS B. Changes in GST law: (1) Last date for filing of intimation, in FORM GST CMP-02, for availing the option of payment of tax under notification No. 2/2019-Central Tax (Rate) dated 07.03.2019 (by exclusive supplier of services), to be extended from 31.07.2019 to 30.09.2019. (2) The last date for furnishing statement containing the details of the self-assessed tax in FORM GST CMP-08 for the quarter April, 2019 to June, 2019 (by taxpayers under composition scheme), to be extended from 31.07.2019 to 31.08.2019. The recommendations of the GST Council would be given effect through relevant Circulars/Notifications, shortly. GST UPDATEZ ON 02-08-2019 GST Revenue collection: crores to the states as GST compensation for the months of April-May, 2019. GST UPDATEZ ON 02-08-2019 The 36th GST Council meeting was held today by video conferencing and the Council has recommended: The total gross GST revenue collected in the month of July, 2019 is ₹ 1,02,083 crore of which CGST is ₹ 17,912 crore, SGST is ₹ 25,008 crore, IGST is ₹ 50,612 crore (including ₹ 24,246 crore collected on imports) and Cess is ₹ 8,551 crore (including ₹797 crore collected on imports). The total number of GSTR 3B Returns filed for the month of June up to 31st July, 2019 is 75.79 lakh. On a comparison with last year, the revenue in July, 2018 was ₹ 96,483 crore and the revenue during July, 2019 is a growth of 5.80% over the revenue in the same month last year. During April-July 2019 vis-à-vis 2018, the domestic component has grown by 9.2% while the GST on imports has come down by 0.2% and the total collection has grown by 6.83%. The Government has released Rs. 17,789 A set of FAQS has been brought out on LDR Scheme 2019 by Directorate of Taxpayer Services, CBIC. GST UPDATEZ ON 02-08-2019 Reference File: Sabka Vishwas FAQs.pdf GST UPDATEZ ON 12-08-2019 E-way bill important: A deterrent provision under Rule 138 E was inserted whereby any registered person fails to file the periodical (Monthly/Quarterly) return will not be able to generate e-way bill. Click here to read full document

43 R. Srivatsan, IRS The provisions were notified vide Notification No. 22/2019 CT, dated 23-4-19 to take effect from 21-06-2019. The two months (two tax periods for a normal taxable person) expires on 20-08-2019. Therefore, with effect from 21.08.2019, those taxpayers will be UNABLE TO GENERATE EWAY Bill who have pending filing of GST Returns for 2 consecutive months or Tax periods (as the case may be). So, it is suggested that all taxpayers may be advised to kindly proceed to file their pending GST Returns on immediate basis in order to use of E-WAY bill portal hassle free. GST UPDATEZ ON 15-08-2019 GSTN releases e-invoice format, seeks comment from stakeholders: inputs as possible, so that the final invoice format suffices for all sectors dearth of deficiency. A deterrent provision under Rule 138 E was inserted whereby any registered person fails to file the periodical (Monthly/Quarterly) return will not be able to generate e-way bill. The provisions were notified vide Notification No. 22/2019 CT, dated 23-4-19 to take effect from 21-06-2019 initially and was later extended to 21-08-2019. Now by Notification No.36/2019 CT, dated 20-08-2019, another extension of 3 months has been given and the provisions of Rule 138 E will take effect from 21-11-2019 only. Therefore, with effect from 21.11.2019, those taxpayers will be UNABLE TO GENERATE EWAY Bill who have pending filing of GST Returns for 2 consecutive months or Tax periods (as the case may be). GST UPDATEZ ON 21-08-2019 E-way bill important: The Goods and Services Tax Network (GSTN) has sought stakeholders’ comments on the new e-invoice format, which will be effective January 2020, and will be mandatory for all dealers. The GST Council in its 35th meeting on June 21 had decided to introduce electronic invoicing system in a phased manner for B2B (Business-to-Business) transactions. Einvoicing is a rapidly expanding technology which would help taxpayers in backward integration and automation of tax relevant processes. It would also help tax authorities in combating the menace of tax evasion and taking input tax credit (ITC) using fake invoices. The measure is also in line with the global practices as many countries across the world have adopted standards for einvoice. The aim of release of the draft model is that every stakeholder should now provide as much GST UPDATEZ ON 22-08-2019 SAB KA VISWAS Legacy Disputes Resolution Scheme has been notified vide Notification No. 5/2019 NT, Central Excise, dt. 21-08-2012 to take effect from 1st September 2019. Click here to read full document Click here to read full document Click here to read full document