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Arjuna (Fictional Character): Krishna, GST Council held its 45th GST Council Meeting at Lucknow on 17th September 2021. What are the recommendations by GST Council relating to changes in GST law and other procedures?

Krishna: Arjuna, the GST Council has taken the following measures for streamlining compliances in GST & in relation to GST law and other procedures-

1. Requirement of filing FORM GST ITC-04 under rule 45 (3) of the CGST Rules has been relaxed as under:

a. Taxpayers whose annual aggregate turnover in preceding financial year is above Rs. 5 crores shall furnish ITC-04 once in six months;

b. Taxpayers whose annual aggregate turnover in the preceding financial year is up to Rs. 5 crores shall furnish ITC-04 annually.

2. Unutilized balance in CGST and IGST cash ledger may be allowed to be transferred between distinct persons (entities having the same PAN but registered in different states), without going through the refund procedure, subject to certain safeguards.

Recommendations in 45th GST Council Meeting

3. Aadhaar authentication of registration to be made mandatory for being eligible for filing refund claims and application for revocation of cancellation of registration.

4. Late fee for delayed filing of FORM GSTR-1 to be auto-populated and collected in next open return in FORM GSTR-3B.

5. Rule 59(6) of the CGST Rules to be amended with effect from 01.01.2022 (earlier to be effective from 01.09.2021) to provide that a registered person shall not be allowed to furnish FORM GSTR-1 if he has not furnished the return in FORM GSTR-3B for the preceding month.

6. Rule 36(4) of CGST Rules, 2017 to be amended, once the proposed clause (aa) of section 16(2) of CGST Act, 2017 is notified, to restrict availment of ITC in respect of invoices/ debit notes, to the extent the details of such invoices/ debit notes are furnished by the supplier in FORM GSTR-1/ IFF and are communicated to the registered person in FORM GSTR-2B.

7. Interest is to be charged only in respect of net cash liability, section 50 (3) of the CGST Act to be amended retrospectively, w.e.f. 01.07.2017, to provide that interest is to be paid by a taxpayer on “ineligible ITC availed and utilized” and not on “ineligible ITC availed”. It has also been decided that interest in such cases should be charged on ineligible ITC availed and utilized at 18% w.e.f. 01.07.2017.

 

Arjuna: Krishna, whether Petroleum products are brought within the ambit of GST?

Krishna: Arjuna, in terms of the recent directions of the Hon’ble High Court of Kerala, the issue of whether specified petroleum products should be brought within the ambit of GST was placed for consideration before the Council. After due deliberation, the Council was of the view that it is not appropriate to do so at this stage.

Arjuna: Krishna, what is the Covid-19 relief measure in form of GST rate concessions?

 

Krishna, (Fictional Character): Arjuna, GST concessions on COVID-19 medicines like Remdesivir which was earlier till 30th September 2021 now extended to 31st December 2021. However, no extension was given for equipment. Further, GST rates on some medicines for Covid-19 treatment have been reduced to 5%.

Arjuna: Krishna, what should the taxpayer learn from this?

Krishna, (Fictional Character): Arjuna, GST council even after the 4 years of GST implementation continuously taking various measures for streamlining compliances in GST. Apart from the above, Council also recommended reducing the GST rate on various goods and services, changes in relation to rates and scope of exemption on Services, Clarification in relation to the GST rate on Goods and services. The detailed press release for the same can be accessed from the CBIC website.

Also Read: Key Highlights of the 45th GST Council Meeting

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