Central Board of Indirect Taxes and Customs (CBIC), in a recent tweet informed that the due date for filing Annual Returns of Financial Year 2018-19 in GSTR-9 and GSTR-9C is extended to 31.10.2020 from 30.09.2020. As per the tweet, notification will be issued later.
GST
Customs & Central Excise
To see extract of press note, please see the link below:
The GST Council, in its 39th meeting held on 14.03.2020, has made the following
recommendations:
The due date for filing Kerala Flood Cess Return for the month of August, 2019 is extended to 30th September, 2019.
CBIC vide Removal of Difficulties Order 7/2019 dated 26th August, 2019 extended the due date for furnishing annual returns for the Financial Year 2017-18 from 31-8-2019 to 30-11-2019.
To see the order click the see below:
CBIC vide circular no. 02/21/2019-GST dated 28th June, 2019 clarified taxability of penal interest on EMI payments. The circular discuss about two scenarios involving EMI transactions, and the same is reproduced below:
Case — 1:
X sells a mobile phone to Y. The cost of mobile phone is Rs 40,000/-. However, X gives Y an option to pay in installments, Rs 11,000/- every month before 10th day of the following month, over next four months (Rs 11,000/- *4 = Rs. 44,000/-). Further, as per the contract, if there is any delay in payment by Y beyond the scheduled date, Y would be liable to pay additional / penal interest amounting to Rs.500/- per month for the delay. In some instances, X is charging Y Rs. 40,000/- for the mobile and is separately issuing another invoice for providing the services of extending loans to Y, the consideration for which is the interest of 2.5% per month and an additional / penal interest amounting to Rs. 500/- per month for each delay in payment.
Analysis:
As per the provisions of sub-clause (d) of sub-section (2) of section 15 of the CGST Act, the value of supply shall include “interest or late fee or penalty for delayed payment of any consideration for any supply”.
As per the provisions of sub-clause (d) of sub-section (2) of section 15 of the CGST Act, the amount of penal interest is to be included in the value of supply. The transaction between X and Y is for supply of taxable goods i.e. mobile phone. Accordingly, the penal interest would be taxable as it would be included in the value of the mobile, irrespective of the manner of invoicing.
Case — 2:
X sells a mobile phone to Y. The cost of mobile phone is Rs 40,000/-. Y has the option to avail a loan at interest of 2.5% per month for purchasing the mobile from M/s ABC Ltd. The terms of the loan from M/s ABC Ltd. allows Y a period of four months to repay the loan and an additional / penal interest @ 1.25% per month for any delay in payment.
Analysis
In terms of Sl. №27 of notification №12/2017- Central Tax (Rate) dated the 28.06.2017 “services by way of (a) extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit card services)”is exempted. Further, as per clause 2 (zk) of the notification №12/2017-Central Tax (Rate) dated the 28th June, 2017, “‘interest’ means interest payable in any manner in respect of any moneys borrowed or debt incurred (including a deposit, claim or other similar right or obligation) but does not include any service fee or other charge in respect of the moneys borrowed or debt incurred or in respect of any credit facility which has not been utilised;”.
The additional / penal interest is charged for a transaction between Y and M/s ABC Ltd., and the same is getting covered under Sl. №27 of notification №12/2017- Central Tax (Rate) dated 28.06.2017. Accordingly, in this case the ‘penal interest’ charged thereon on a transaction between Y and M/s ABC Ltd. would not be subject to GST, as the same would not be covered under notification №12/2017-Central Tax (Rate) dated 28.06.2017. The value of supply of mobile by X to Y would be Rs. 40,000/- for the purpose of levy of GST.
It is further clarified that the transaction of levy of additional / penal interest does not fall within the ambit of entry 5(e) of Schedule II of the CGST Act i.e. “agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act”, as this levy of additional / penal interest satisfies the definition of “interest” as contained in notification №12/2017- Central Tax (Rate) dated 28.06.2017.
It is further clarified that any service fee/charge or any other charges that are levied by M/s ABC Ltd. in respect of the transaction related to extending deposits, loans or advances does not qualify to be interest as defined in notification №12/2017- Central Tax (Rate) dated 28.06.2017, and accordingly will not be exempt.
GST Council in its 35th meeting recommended following schedule for implementation of new GST returns. The recommendations are given below:
A. For Small tax payers (those having turnover of upto Rs. 5 Crores in previous financial year)
i) Form GST ANX-1: Quartely starting from period October, 2019 to December, 2019 in January, 2020.
ii) Form GST RET-01: Quartely starting from period October, 2019 to December, 2019 in January, 2020.
iii) Form GST PMT-08: To filed from October, 2019
Note: Form GSTR-3B need not be filed from October,2019
B. Large Tax Payer (those having turnover of more than Rs. 5 Crores in previous financial year)
i. Form GST ANX-1: Compulsory filing from October 2019
ii. Form GSTR-3B: To be filed for October 2019 & November 2019
iii. Form GST RET-01: To be filed from December 2019
It is also decided that Form GST ANX-I and Form GST ANX-2 will be available on trial basis to taxpayers between July 2019 to September 2019.
There will be an option to upload Invoices etc. FORM GST ANX-1 on a continuous basis both by large and small taxpayers from October 2019 onwards. During this period, FORM GST ANX-2 may be viewed simultaneously, but no action can be taken.
GSTR-3B will be completely phased out by January, 2020.
The Supreme Court suggested to the high courts on Wednesday not to grant anticipatory bail to those who default on the goods and services tax (GST), and reminded them that the SC has upheld the Telangana HC’s decision not to grant bail to such defaulters, the Times of India said in a report.
On April 18, a division of the Telangana HC had upheld the authority and power of the commissioner of the central goods and services tax (CGST) to arrest and rejected any interim relief to those accused of violating the CGST Act, 2017.
On May 27, the Supreme Court dismissed an appeal against the HC order. The Centre had argued that CGST officers were not police and hence not required to follow the provisions of the Criminal Procedure Code, which mandates registration of FIR prior to arrest, the ToI report mentioned.
However, the Bombay high court had passed a series of orders granting pre-arrest bail to CGST Act violators on the ground that the CGST officials had not registered any FIR as warranted under the CrPC. Following these orders, the Centre had filed a bunch of appeals in the SC against the Bombay high court orders.
Challenging the Bombay HC’s orders, solicitor general Tushar Mehta said Parliament had segregated CGST Act from CrPC and provided a separate procedure for dealing with offenders. Mehta said the HC’s orders had brought “functions of the directorate general of GST intelligence to a grinding halt”.
According to the daily, a vacation bench of Chief Justice Ranjan Gogoi and Justice Aniruddha Bose said, “As different high courts of the country have taken divergent views in the matter, we are of the view that the position in law should be clarified by this court. Hence the notice.”
“As the accused-respondents have been granted the privilege of pre-arrest bail by high courts by the impugned orders, at this stage, we are not inclined to interfere with the same. However, we make it clear that the high courts, while entertaining such requests in future, will keep in mind that the Supreme Court by order dated May 27 had dismissed the special leave petition filed against the judgment and order of the Telangana high court in a similar matter, wherein the high court of Telangana had taken a view contrary to what has been held by the high court (of Bombay) in the present case. Beyond the above, we do not consider it necessary to observe anything further,” the ToI report quoted the top court as saying in the notice.
However, senior advocate Mukul Rohatgi requested the CJI to delete the reference to the apex court upholding the Telangana HC order as it would “close all doors” for the accused under CGST Act to seek relief. The bench refused to oblige and said, “That is the whole idea.”
Source: Times of India
CBDT issued an order ( F. No. 225/105/2019/ITA.II dated 30th April, 2019) specifying the Income Tax authority for furnishing information in respect of assessees to the Nodal officer, GSTN.
The text of the order is given below:
Order
In exercise of powers conferred under section 138(1)(a) of the Income tax Act, 1961 (‘Act’), for purposes of sub-clause (i) of section 138(1)(a) of the Act, the Central Board of Direct taxes (‘CBDT’) hereby directs that Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems), New Delhi shall be the specified income-tax authority for furnishing information respecting assessees to the Nodal Officer, Goods and Services Tax Network (‘GSTN’).
2. The data/information to be furnished by the specified income-tax authority shall be:
(a) Request based exchange of data, wherein, important financial fields which are captured in the Income Tax Returns (ITRs) such as (i) status of filing of ITR; (ii) turnover; (iii) gross total income, (iv)turnover ratio; (v)GTI range; (vi) turnover range and (vii) any other field, the modalities of which shall be decided by the concerned specified authorities.
(b) Spontaneous exchange of data, the modalities of which shall be decided by the concerned specified authorities.
(c) Automatic exchange of data, the modalities of which shall be decided by the concerned specified authorities.
While furnishing the information, the specified income-tax authority shall form an opinion that sharing of such information is necessary for the purposes of enabling the specified authority in GSTN to perform its functions under the Goods and Services Tax.
3. To facilitate the process of furnishing information, Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) would enter into a Memorandum of Understanding (‘MoU’) with nodal officer, GSTN, which inter-alia would include modalities of exchange of data, maintenance of confidentiality, mechanism for safe preservation of data, weeding out after usage etc. The time line for furnishing information shall also be decided by Pr. Director General of Income-tax (Systems) or Director General of Income-tax (Systems) in consultation with concerned nodal officer and included in the said MoU.
4. A copy of MoU shall be forwarded to this division for record purposes.
5. This issues with the approval of Chairman, CBDT.
A similar order is expected from CBIC also in the near future,
CBIC had notified that Government of India appoints the 21st day of June, 2019, as the date from which the provisions of the Rule 138E of Central Goods and Service Tax, Rule (Inserted by Central Goods and Services Tax (Fourteenth) Amendment Rules, 2018 rule 12 of [notification No. 74/2018–Central Tax, dated the 31st December, 2018]), which restricts generation of Part A of E-way bill in case on non-filing of returns for two consecutive months by a normal registered person and in case of composition dealers under section 10 of CGST Act, non-filing of returns for two tax periods.
The extract of the rule 138E is given below:
“138E. Restriction on furnishing of information in PART A of FORM GST EWB-01.- Notwithstanding anything contained in sub-rule (1) of rule 138, no person (including a consignor, consignee, transporter, an e-commerce 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;
Provided further that no order rejecting the request of such person to furnish the information in PART A of FORM GST EWB 01 under the first proviso shall be passed without affording the said person a reasonable opportunity of being heard;
Provided also that the permission granted or rejected by the Commissioner of State tax or Commissioner of Union territory tax shall be deemed to be granted or, as the case may be, rejected by the Commissioner.
Explanation:– For the purposes of this rule, the expression ―Commissioner‖ shall mean the jurisdictional Commissioner in respect of the persons specified in clauses (a) and (b).”
As per the rule, a registered person can’t fill PART- A of FORM GST EWB-01 in case of another registered person, who had defaulted in filing retun for two months or two tax periods. For Example, M/s.ABC is selling goods to M/s.XYZ, for a value exceeding the limits prescribed for E-way bill, M/s.ABC is not allowed to submit/furnish information in relation such supply, when M/s.XYZ had defaulted in filing return. In this case M/s.XYZ, is also not permitted to furnish PART- A of FORM GST EWB-01. So non-filing of returns for two months of two tax periods will result in not getting goods and there by affect your business operations.
So registered persons especially those dealing in goods or require goods in providing the services, should ensure that all the backlogs in filing GST returns were cleared on or before 21st June, 2019 and ensure that the monthly returns are filed in time. This is an additional restriction, that is going to be imposed in addition of late fee for filing return and Interest on delayed payment of tax.
Karthik & Sunil 