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Introduction

The roll out of GST has been a landmark achievement with respect to unifying multiple central and state taxes barring a few goods / sectors and availability of Input Tax Credit (ITC)across the entire value chain. Multiplicity of tax rates has also been eliminated to a large extent.

The prime objective of any tax reform is simplified tax administration, minimal compliance/ documentations, reduction in tax evasion, improvement in ease of doing business & increased tax revenue for the Govt. But though it has been more than two years of its implementation, none of these objectives appears to have been achieved. As per the CAG Audit report on GST tabled in Parliament, on 30th July 2019, post implementation of GST, the Centre's revenue on goods and services (excluding central excise on Petroleum and Tobacco) has also registered a decline of 10 per cent in 2017-18 as compared to revenue of subsumed taxes in 2016-17.Filing of GST return by registered person has also shown a declining trend & the system is prone to ITC fraud.

GST System has remained a system, still in the making even after more than two years of roll out, with the entire return filing mechanism undergoing major changes. The complexity of return mechanism and the technical glitches, resulted in roll back of invoice-matching, rendering the system prone to ITC frauds. The invoice-matching system has not yet been made operational & filing of GSTR- 2 & GSTR -3 has been kept in abeyance since implementation of GST.

STATUTORY PROVISION

The provision relating to filing of returns is contained in Sec 37 to 48 (Chapter IX) of CGST Act, 2017.

The GST Council in its 31st meeting had decided that a new GST return system will be introduced to facilitate taxpayers. The return filing system have been completely overhauled & new GST return form SAHAJ, SUGAM & NORMAL have been proposed to be introduced w.e.f 1st October 2019.A prototype of the offline tool has also been shared on the GST common portal to give the look and feel of the tool to the users. Once the new return filing system is made fully operational, the existing GSTR -1/2/3 & GSTR 3B will be discontinued.

STRUCTURE OF NEW GST RETURN

1) There are three types of Returns prescribed under NEW RETURN FILING SYSTEMS under GST.

RETURN

FORM

FREQUENCY

ELIGIBILITY

NORMAL

GST RET - 1

Monthly/Quarterly

If, aggregate turnover is more than Rs. 5 crores mandatory & optional for turnover upto Rs. 5 crores.

SAHAJ

GST RET - 2

Quarterly

If, aggregate turnover is less than Rs. 5 crores & (B2C) supply only.

SUGAM

GST RET - 3

Quarterly

If, aggregate turnover is less than Rs. 5 crores & both (B2B) & (B2C) supply

2) While opting for any type of return, there is a questionnaire provided at the GST Portal which needs to be answered. Hence taxpayers need to answer the questionnaire carefully in order to comply with returns procedure in line with their businesses & requirements.

3) The existing GSTR 1 & GSTR 2 will be replaced with GST ANX - 1 and GST ANX - 2 respectively.

4) If the Turnover of an assessee during the preceding financial year is more than Rs. 5 Crores, then the assessee by default has to file monthly returns (GST RET - 1) and two annexures (FORM GST ANX-1 andFORM GST ANX-2). If the Turnover is less than Rs 5 crores then the assessee has an option to choose Monthly or Quarterly Return

5) SAHAJ can be opted only if the assessee has outward supplies under B2C category and inward supplies including supplies attracting reverse charge only.

6) SUGAM can be opted only if the assessee has outward supplies under B2B & B2C categories and inward supplies including supplies attracting reverse charge only.

7)Taxpayers who opted SAHAJ (or) SUGAM cannot claim input credit on missing invoices. They also need not report on nil rated, exempted and Non-GST supplies.

8)Normal returns ( GST RET-1) allow reporting of all types of inward and outward supplies.

9) If, inward supply involves import of goods & services & ISD credits, filing of GST RET-1 is mandatory.

10) Nil return can be filed by sending SMS from registered mobile.

11) The taxpayer firstly needs to upload details of outward supplies in FORM GST ANX-1 and take action on the inward supplies auto-populated in FORM GST ANX-2. After that, the taxpayer shall file the main return in FORM GST RET-1/2/3 in which some data will be auto-populated from FORM GST ANX-1 and FORM GST ANX-2 and some data need to be manually entered by the taxpayer.

12) Switching between Monthly and Quarterly option can be exercised only at the beginning of each Financial Year

13) Switching from Normal to SUGAM (or) SAHAJ can also be exercised only once in a financial year at the beginning of any quarter.

14)Switching from SUGAM to SAHAJ is available only once in a financial year at the beginning of any quarter.

15) Switching from SUGAM to NORMAL is available more than once in a financial year at the beginning of any quarter.

16) Switching from SAHAJ to SUGAM (or) NORMAL (under Quarterly option) is available more than once in a financial year at the beginning of any quarter.

NEW GST RETURN FORM AT A GLANCE

Return/ FORM

Frequency

Category of Registered person liable to file Return

Remarks

GST RET-1 (NORMAL)

MONTHLY

If, aggregate turnover is more than Rs. 5 crores in the preceding financial year.

Composition Scheme Dealer, NRTP, OIDAR service provider, ISD not liable to file.

QUARTERLY

If, aggregate turnover is less than Rs. 5 crores in the preceding financial year

-Do-

GST RET-2 (SAHAJ)

QUARTERLY

If, aggregate turnover is less than Rs. 5 crores in the preceding financial year & who makes supply only to unregistered person (B2C).

Composition Scheme Dealer, NRTP, OIDAR service provider, ISD, person whose turnover more than Rs.5 Crores & person who supply to B2B, can not file GST RET-2 (SAHAJ)

GST RET-3 (SUGAM)

QUARTERLY

If, aggregate turnover is less than Rs. 5 crores in the preceding financial year & who makes supply to B2B & B2C.

Composition Scheme Dealer, NRTP, OIDAR service provider, ISD, person whose turnover more than Rs.5 Crores, can not file GST RET-2 (SAHAJ).

FORM GST ANX-1

MONTHLY/ QUARTERLY

Filing of this Form is mandatory before filing of GST RET-1/2/3.

Annexure of outward supplies and inward supplies attracting reverse charge. This FORM is in lieu of FORM GSTR -1.

FORM GST ANX-2

Auto Populated

Data uploaded by the supplier in GST ANX-1, will be shown in GST ANX-2. These details have to be 'accepted' or 'rejected' or 'marked as pending' before filing of GST RET-1/2/3.

Annexure of inward Supplies.

GST ANX-1A

Auto Populated

Amendment to Form GST ANX-1.

To make any amendment in GST ANX-1, this Form shall be filed.

GST RET-1A/2A/3A

Auto Populated

Amendment to Form GST RET-1/2/3

To make any amendment in GST RET-1/2/3, this Form shall be filed.

GST PMT-08

MONTHLY/ QUARTERLY

Payment of Self-assessed tax

The author is a Fellow member of The Institute of Chartered Accountant of India, New Delhi i& Fellow member of The Institute of Cost Accountants of India, Kolkata. He is author of Amazon Best seller book on GST titled "Students' Guide to GST for Nov 2019 Exam" published by Mewar University Press. Available on Flipkart/Amazon & all leading book stores across the country. He can be reached at gstresolve@gmail.com

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