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Notification 1/2017 - Central Tax: Notified 18 sections of IGST Act with effect from 22nd June 2017

What notification says?

Appointment date as 22nd June 2017 for Section 1, 2, 3, 4, 5, 10, 22, 23, 24, 25, 26, 27, 28, 29, 30, 139, 146 and 164 of the CGST Act, 2017, coming into force.

Analysis: Reason for notification before 1st July 2017: To enable enactment of the Act and thereby gain the power to issue CGST rules before GST rollout on 1 July. The aforesaid sections are discussed in simple to understand as below.

1. Section 1: It deals with title (CGST Act), extent (whole India except J&K) and the effective date of commencement of the Act via notification by Central Government.

2. Section 2: Definitions. This section has 121 definition (in clauses 1 to 21). Some important ones are:


Adjudicating Authority

Aggregate Turnover

Agriculturist

Appointment Date

Business

Business Vertical

Casual Taxable Person

Common Portal

Consideration

Drawback

E-commerce

E-commerce operator

Exempt Supply

Existing Law

Fixed Establishment

India

Input Service Distributor

Input Tax Credit

Job work

Location of service supplier

Location of service recipient

Place of Business

Place of supply

Recipient of supply

Removal

Services

Supplier

Taxable person

Union Territory

Voucher


3. Section 3: Power of Central Government to appoint CGST officers.

Central Excise Officers are deemed to be officers under CGST. Further, CG can notify following 8 types of officers, namely:

  1. Principal Chief Commissioners of Central Tax or Principal Directors General of Central Tax
  2. Chief Commissioners of Central  Tax or Directors  General of  Central Tax
  3. Principal Commissioners of Central Tax or Principal Additional Directors General of Central Tax
  4. Commissioners of Central Tax or Additional Directors General of Central Tax
  5. Additional Commissioners of Central Tax or Additional Directors of Central Tax
  6. Joint Commissioners of Central Tax or Joint Directors of Central Tax
  7. Deputy Commissioners of Central Tax or Deputy Directors of Central Tax
  8. Assistant Commissioners of Central Tax or Assistant Directors of Central Tax

Further, their jurisdiction is also decided and a detailed list is given in a separate notification.

4. Section 4: Power of CBEC to appoint officers (in addition to those mentioned above).
5. Section 5: Powers of officers under GST to discharge functions & delegate to sub-ordinates.
6. Section 10: Composition Levy option if turnover in preceding financial year is upto 75 lakhs.

(Turnover includes all supplies including exempt supplies and exports of goods)

2% (1% CGST + 1% SGST) in case of manufacture of goods
5% (2.5% CGST + 2.5% SGST) in case of food/restaurant service
1% (0.5% CGST + 0.5% SGST) in case of others suppliers (goods traders/agents)

However, no ITC will be eligible and recovery of GST from customers is not possible.

Main conditions to opt for composition scheme are:

  • Not to make supply which are not liable to GST (Nil rated supply permitted)
  • Not to make inter-state outward supply (inter-state inward supply permitted)
  • Not to make supplies through e-commerce operator
  • Not eligible for supply of notified goods (ice cream, tobacco, bidi)
  • All GST registered persons under same PAN need to take composition scheme (This means composition not available for selective businesses or selective transactions)
  • The person should not be “Casual Taxable Person” or “Non-resident taxable person”
  • In case of migration/transition, no inter-state stock should be there.

7. Section 22: Persons liable for registration

  • If turnover exceeds Rs 20 lakhs (10 lakhs if NE states)[including exempt supply & as agent]
  • If already registered under current law
  • Transferee/successor to get registered in case of transfer/succession of business by a GST registered person.

8. Section 23: Persons NOT liable for registration

  • Agriculturist for supply out of agricultural land
  • Person is supplying ONLY exempt goods and/or service

9. Section 24: Compulsory Registration in certain cases (over-riding section 22, i.e. irrespective of 20/10 lakh turnover limits)

  • Person making ANY inter-state supply
  • 'Casual Taxable Person' making taxable supplies (no registration if exempt supplies)
  • E-commerce operator (or his representative) paying GST in India
  • Non-resident taxable person making taxable supplies (not if exempt supplies)
  • Persons required to deduct TDS under GST
  • Agents etc.  making supplies on behalf of someone
  • Input service Distributors (ISD)
  • Persons supplying THROUGH e-commerce operators
  • OIDAR services supplier

10. Section 25: Procedure for registration - Registration to be within limit of 30 days from the date he is liable to get registered under GST.
11. Section 26: Deemed Registration if application is not rejected.
12. Section 27: Special Provisions for Casual Taxable Person (CTP) and Non-resident Taxable person (NRTP) - Time limit for registration of 90 days with advance GST deposit
13. Section 28: Amendment of registration
14. Section 29: Cancellation of Registration
15. Section 30: Revocation of Cancellation of Registration
16.Section 139: Migration of Existing Taxpayers by issuing GST registration Certificate
17. Section 146: Common Portal shall be www.gst.gov.in for the purposes of registration, tax payment, filing of returns, e-way bills, etc.
18. Section 164: Power of Central Government to make Rules

The author can also be reached at devansh@devanshjain.com

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