“After a certificate of registration in FORM GST REG-06 has been made available on the common portal and a Goods and Services Tax Identification Number has been assigned, the registered person, except those who have been granted registration under rule 12 or, as the case may be rule 16, shall within a period of thirty days from the date of grant of registration, or before furnishing the details of outward supplies of goods or services or both under section 37 in FORM GSTR-1 or using invoice furnishing facility, whichever is earlier, furnish information with respect to details of bank account on the common portal.”

In this regard, the GST Department has issued an advisory requesting all taxpayers who have not yet furnished their bank account details on the GST portal, to furnish the same, in order to avoid disruption in their business activities as non-declaration of the same may lead to subsequent suspension and cancellation of the GSTIN.

For the same, the Government is planning to deploy a new functionality with the following features:

1. Failure to furnish the bank account in the stipulated time would result into following:

a) Taxpayer registration would get suspended after 30 days and intimation in FORM REG-31 will be issued to the Taxpayer

b) Taxpayer would be debarred from filing any further GSTR-1/IFF

2. Revocation of Suspension: If the taxpayer updates their bank account details in response to the intimation in FORM REG-31, the suspension will be automatically revoked.

3. Cancellation of Registration: If the bank account details are not updated even after 30 days of issuance of FORM REG-31, the registration after suspension may also be taken up for cancellation process by the Officer.

It is therefore advised that if your bank account details are yet to be updated on the GST portal, the same should be updated at the earliest to avoid suspension of the GST registration.

The post Furnishing of Bank Account details mandatory to avoid GST cancellation appeared first on GST Platform.

Earlier the definition read as –

“Input Service Distributor” means an office of the supplier of goods or services or both which receives tax invoices issued under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services or both having the same Permanent Account Number as that of the said office;

 The new definition states that –

“Input Service Distributor” means an office of the supplier of goods or services or both which receives tax invoices towards the receipt of input services, including invoices in respect of services liable to tax under sub-section (3) or sub-section (4) of section 9, for or on behalf of distinct persons referred to in section 25, and liable to distribute the input tax credit in respect of such invoices in the manner provided in section 20;

It can be seen that the definition of ISD has been widened to include offices that receive tax invoices for input services, including those services liable to tax under reverse charge mechanisms specified in sections 9(3) and 9(4). This means that ISDs can now handle a broader spectrum of invoices, including those under reverse charge, and distribute input tax credit for both forward charge and reverse charge services across distinct persons specified under section 25.

Section 20 has also been amended, which mandates every such office qualifying as an ISD to register under clause (viii) of section 24. Till now, it was noticed that taxpayers used to cross charge the service proportionate to other units and charge GST, instead of distributing credit through the ISD mechanism, and the recipient unit availed the input tax credit of such GST paid. However, with this amendment, it is now compulsory for units to take an ISD registration in order to distribute the input tax credit.

The said amendment simplifies the input tax credit distribution process by taxpayers having multiple units under the same PAN, especially for services under reverse charge mechanisms. Earlier, businesses had to issue invoices to respective branches for services under reverse charge mechanism, while forward charge services were managed through ISDs. The new definition eliminates this distinction, allowing credit of all invoices for common input services, regardless of their RCM status, to be distributed through ISDs. Further, businesses now have to mandatorily take a registration as ISD and distribute the common credit.

As a way forward, businesses need to review their current GST and input service distribution processes and update the accounting and ERP systems to align with the change. This amendment marks a progressive step towards simplifying GST compliance and enhancing operational efficiency and is expected to streamline the operations, reduce compliance burden, and ensure a smoother input tax credit distribution.

The post Change in the definition of ISD – Interim Budget 2024 appeared first on GST Platform.

Taxpayers would need to provide one-time password (OTP) post entering user id and password, the OTP will be delivered to their Primary Authorized Signatory “Mobile number and E-mail id”.

Tax-payers are requested to keep their email and mobile number of authorized signatory updated on the GST Portal for receiving the OTP communication. This OTP would only be asked, in case the tax-payer changes the system (desktop or laptop or browser) and location.

We can now expect the 2^nd phase to start soon where it will be mandatory for all taxpayers to provide the OTP during login into the GST portal.

Also read our other related articles:

https://gstplatform.com/4-digit-hsn-code-mandatory-w-e-f-1-february-2024/ https://gstplatform.com/new-feature-on-gst-portal-form-gst-drc-01c/

The post OTP authentication for logging-in to GST portal appeared first on GST Platform.

Notification No. 78/2020 –Central Tax, dated 15th October, 2020 made it mandatory for taxpayers whose Annual Aggregate Turnover (AATO) is more than Rs. 5 Crores to provide at least 6 digit HSN code for all the B2B and Export transactions.

As per the latest update, taxpayers with AATO less than Rs. 5 Crores, need to provide at least 4 digit HSN code. This validation will be implemented in E-Way bill System from 1st February 2024.

Hence, the taxpayers are advised to make necessary changes in their systems and enter four or six digit HSN codes while generating the e-way bills through web and API systems from 1st February 2024.

Also read our other related articles:

https://gstplatform.com/new-feature-on-gst-portal-form-gst-drc-01c/ https://gstplatform.com/introduction-of-table-14-table-15-in-gstr-1

The post 4-digit HSN code mandatory w.e.f. 1 February 2024 appeared first on GST Platform.

Table 14(a) —->> Details of the supplies made through e-commerce operators on which ecommerce operators are liable to collect tax under section 52 of the Act [Supplier to report]

The GSTIN wise summary of the supplies made through ECO on which ECO is liable to collect tax at sources (TCS) and liability on which has already been reported in any table 4 to 10 of GSTR-1, shall be reported by the supplier in this section. No taxable value or tax liabilities will be auto-populated from this table to GSTR-3B. Amendments to this section shall be reported in Table 14A(a).

Table 14(b) —->> Details of the supplies made through e-commerce operators on which ecommerce operators are liable to pay tax u/s 9(5) [Supplier to report]

The summary details of the supplies made through ECO on which ECO is liable to pay tax u/s 9(5) is to be reported by the supplier. Tax on such supplies shall be paid by the ECO and not by the supplier. This is to be reported net of credit / debit note (if any). Such values will be auto-populated to Table 3.1.1(ii) of GSTR-3B. Amendments to this section shall be reported in Table 14A(b).

Table 15 —->> Details of the supplies made through e-commerce operators on which e-commerce operator is liable to pay tax u/s 9(5) [E-Commerce operator to report]

Eco shall report the supplies on which they are liable to pay tax u/s 9(5) in Table 15. Such supplies shall not be reported anywhere else in GSTR-1/IFF. There are four categories in which supplies will be reported.

> Registered Supplier and Registered Recipient (B2B) – In this section the details of such supplies where both the supplier and receiver of supplies are registered person, is to be reported by ECOs at invoice level. This will be available in IFF also. Debit Note / credit note (if any) is to be reported in Table 9B.

> Registered Supplier and Unregistered Recipient (B2C) – In this section the supplier level details along with POS and rate wise detail of the supplies related to the transaction where the supply is being made from a registered supplier to unregistered recipient need to be reported by e-commerce operator. This will not be available in IFF. This is to be reported net of credit / debit note (if any).

> Unregistered Supplier and Registered Recipient (URP2B) – In this section the document level details of the supplies made from unregistered supplier to registered recipient through ECO needs to be reported by the e-commerce operator. The detail to furnish will include the document detail and GSTIN of recipient. This will be available in IFF also. Debit Note / credit note (if any) is to be reported in Table 9B.

> Unregistered Supplier and Unregistered Recipient (URP2C) – In this section the POS and rate wise detail of the supplies from an unregistered supplier to unregistered recipient through ECO is to be reported by the e-commerce operator. This will be not be available in IFF. This is to be reported net of credit / debit note (if any).

The values reported under table 15 shall be auto-populated in Table 3.1.1(i) of corresponding GSTR-3B and such liabilities is to be paid by the ECOs in GSTR-3B in cash. Amendments are to be reported in Table 15A(I) (for registered recipient) & 15A(II) (for unregistered recipient) respectively.

These tables have now been made live on the GST common portal and will be available in GSTR-1/IFF from the tax period January’24 onwards.

Also read our other related articles:

https://gstplatform.com/new-feature-on-gst-portal-form-gst-drc-01c/

https://gstplatform.com/e-invoice-applicability-whether-penalty-is-rightfully-levied/

The post Introduction of Table 14 & Table 15 in GSTR-1 appeared first on GST Platform.

As per the said advisory, it is to be noted that GSTN has developed a functionality to generate automated intimation in Form GST DRC-01C which enables the taxpayer to explain the difference in Input tax credit available in GSTR-2B statement & ITC claimed in GSTR-3B. This feature is now live on the GST portal.

This functionality compares the ITC declared in GSTR-3B with the ITC available in GSTR-2B for each return period. If the claimed ITC in GSTR 3B exceeds the available ITC in GSTR-2B by a predefined limit or the percentage difference exceeds the configurable threshold, the taxpayer will receive an intimation in the form of GST DRC-01C.

Upon receiving the intimation, the taxpayer must file a response using Form DRC-01C – Part B. The taxpayer has the option to either provide details of the payment made to settle the difference using Form DRC-03, or provide an explanation for the difference, or even choose a combination of both options. In case, no response is filed by the impacted taxpayers in Form DRC-01C Part B, such taxpayers will not be able to file their subsequent period GSTR-1/IFF.

Also read our other related articles:

https://gstplatform.com/no-itc-reversal-for-gstr2a-mismatch-says-supreme-court/ https://gstplatform.com/return-filing-cannot-be-denied-at-any-cost-says-high-court/

The post New feature on GST portal – Form GST DRC-01C appeared first on GST Platform.

First of all, it is important to understand that e-invoice is not applicable for all registered persons under GST. The categories of person on whom e-invoice is not applicable are as follows:

• Banks, Insurance Companies, and Financial Institutions including but not limited to NBFCs
• Goods Transport Agency
• Passenger Transport Services
• Supplier of Services by way of admission to the exhibition of films.
• Special Economic Zones (SEZ) Units (E-invoicing is applicable to Economic Zone Developers)
• A government department and Local authority
• OIDAR i.e. person supplying online information and database access or retrieval services from a place outside India to a non-taxable online recipient

Therefore, all persons either issue B2C invoices or they fall in the above-mentioned categories, are exempted from e-invoice.

E-invoice has been implemented phase-wise for reporting B2B invoices. Only the large businesses were targeted initially to start with the e-invoice system, and gradually, in a phased manner, smaller businesses have been brought into its scope by reducing the turnover limit.

The applicability of e-invoice based on the turnover has been given below:

Therefore, w.e.f. 1^st August 2023, all businesses with annual turnover exceeding five crore rupees shall mandatorily issue e-invoice. Further, it should be noted that turnover for the purpose of determining the eligibility of e-invoice means turnover of all GSTINs under a single PAN for any of the financial years from 2017-18 onwards.

If the applicable provisions for e-invoice are violated, two types of penalties may be levied:

• Penalty for failure to create an e-invoice: If a person to whom e-invoice applies, fails to generate an e-invoice, the penalty would be equal to either 100% of the tax owed on the supply or Rs. 10,000, whichever is greater.
• Penalty for incorrect e-invoice: If an e-invoice is created improperly, penalty equal to Rs. 25,000 per invoice shall be levied.

With the increasing litigation under GST, various notices are being issued levying penalty for non-compliance of e-invoice provisions. Hence, it is important to check the eligibility criteria and turnover threshold to determine whether e-invoice is eligible to a person or not for the period under dispute.

Also read our other articles:

https://gstplatform.com/gst-return-revision/

https://gstplatform.com/no-itc-reversal-for-gstr2a-mismatch-says-supreme-court/

https://gstplatform.com/return-filing-cannot-be-denied-at-any-cost-says-high-court/

The post E-Invoice Applicability – Whether Penalty is rightfully levied? appeared first on GST Platform.

1. The Supreme Court (SC) has issued a notice in response to a writ petition filed by Pradeep Kanthed, seeking the Finance Ministry’s response on the absence of an option for revised returns on the GST Portal.

2. The petitioner argues that the absence of a provision for revised returns on the GST Portal is causing difficulties for GST-registered individuals and dealers, contrary to other revenue laws that typically include such provisions.

3. The petitioner contends that the lack of this option is illogical and deprives individuals of their fundamental rights. The matter is scheduled for a hearing on January 12.

 Supreme Court – Pradeep Kanthed v. UOI [WRIT PETITION(S)(CIVIL) NO(S). 1006/2023]

Read Other Related Articles – https://gstplatform.com/no-itc-reversal-for-gstr2a-mismatch-says-supreme-court/

The post GST Return Revision appeared first on GST Platform.

Reference is made to the Instruction No. 04/2023-GST dated 23rd November 2023 issued on the said subject. Section 52, Section 73, Section 74, Section 122, Section 123, Section 124, Section 125, Section 127, Section 129 and Section 130 of the Central Goods and Service Tax Act, 2017 (hereinafter referred to as the “CGST Act”) states that a notice is required to be issued by the proper officer to a person for demand and recovery of any amount of tax not paid or short paid/ amount of input tax credit wrongly availed/ amount of refund erroneously made, for recovery of interest and/ or for imposition of any penalty or fine on the said person.

Further, sub-rule (1) of rule 142 of Central Goods and Service Tax Rules, 2017 (hereinafter referred to as the “CGST Rules”) states that along with such notices, a summary is also required to be served by the proper officer electronically on the portal in FORM GST DRC-01. Further, sub-rule (5) of rule 142 of the CGST Rules states that where any order is issued by the proper officer under Section 52 or Section 62 or Section 63 or Section 64 or Section 73 or Section 74 or Section 75 or Section 76 or Section 122 or Section 123 or Section 124 or Section 125 or Section 127 or Section 129 or Section 130 of CGST Act, summary of such order is also required to be uploaded electronically on the portal by the proper officer in FORM GST DRC-07, specifying the amount of tax, interest and penalty, as the case may be, payable by the person concerned.

In many cases it is noticed that such notices and order in Form DRC-01 & DRC-07 respectively, are being issued manually and not electronically on the GST portal. Non-issuance of the summary of such notices/ orders electronically on the portal is in clear violation of the explicit provisions of CGST Rules. Besides, serving/ uploading the summary of notices/ orders electronically on the portal not only makes the said notices/ orders available electronically to the taxpayers on the portal, but also helps in keeping a track of such proceedings and consequential action in respect of recovery, appeal etc. subsequent to issuance of such notices/ orders.

Accordingly, any deviation from this requirement under CGST Rules may adversely impact record keeping under GST. Further, such an action may also impact further proceedings of appeal and/ or recovery to be done seamlessly on the portal. Therefore, vide this instruction, the proper officers are directed to ensure that the summary of notices in Form GST DRC-01 and summary of order in Form GST DRC-07 is uploaded electronically on the GST portal.

Therefore, in a case where any notice or order is issued manually, the taxpayer can request for issuance of such notice or order electronically on the GST portal before proceeding to respond to the same.

Also read our other related articles:

https://gstplatform.com/no-itc-reversal-for-gstr2a-mismatch-says-supreme-court/

https://gstplatform.com/return-filing-cannot-be-denied-at-any-cost-says-high-court/

The post Mandatory Issuance of DRC-01 & DRC-07 electronically appeared first on GST Platform.

In this matter, M/s. Suncraft Energy Pvt. Ltd. (“the assessee”) availed Input Tax Credit on certain inward supplies basis the invoices received from the suppliers. However, such ITC was not reflecting in GSTR-2A for the FY 2017-18 since the suppliers failed to disclose these supplies in their Form GSTR-1. Demand was raised on the assessee to reverse such excess ITC availed on account of mis-match between GSTR-3B and GSTR-2A. The assessee made its submissions on following three major grounds:

1. Press release dated 04.05.2018 which clarified that there shall not be any automatic reversal of input tax credit from buyer on non-payment of tax by the seller. In case of default in payment of tax by the seller, recovery shall be made from the seller however, reversal of credit from buyer shall be an option available with the revenue authorities to address exceptional situations like missing dealer, closure of business by supplier or supplier not having adequate assets etc.

2. The Press Release dated 18.10.2018 which clarified that furnishing of outward details in Form GSTR-1 by the corresponding supplier and the facility to view the same in Form GSTR-2A by the recipient is in the nature of taxpayer facilitation and does not impact the ability of the taxpayer to avail ITC on self-assessment basis in consonance with the provisions of Section 16 of the Act.

3. Judgements of the Hon’ble Supreme Court in the case of M/s Union of India vs Bharti Airtel Ltd. and Ors. and Commissioner of Trade and Taxes, Delhi and Ors. vs Arise India Limited and Ors. which held thatin the event that the selling dealer has failed to deposit the tax collected by him from the purchasing dealer, the remedy for the Department would be to proceed against the defaulting selling dealer to recover such tax and not deny the purchasing dealer the ITC.

The Hon’ble Calcutta High Court accepted the contentions of the assessee and ruled in favour of the assessee. It held that ITC claimed by the purchaser cannot be denied if the supplier has not remitted GST on it’s output supply unless there is an exceptional case where it becomes impossible for the department to collect such tax from the supplier and if there is even a little chance of recovering the tax from the supplier, demand needs to be raised to the supplier before demanding reversal of credit from the purchaser.

The Department filed a SLP against the judgement of the Hon’ble Calcutta High Court. On review of the matter, the Hon’ble Supreme Court dismissed the SLP filed by the Department and upheld the decision of the Hon’ble Calcutta High Court [SC Judgment dated 14-12-2023 in Special Leave to Appeal (C) No(s).27827-27828/2023].

This is a landmark judgement which can be applied in cases where the ITC is denied on account of mismatches between GSTR-3B and GSTR-2A. However, it might be interesting to note how this decision would apply in cases of dispute for period after the introduction of Rule 36(4) from October 9, 2019, and Section 16(2)(aa) from January 1, 2022.

The post NO ITC REVERSAL FOR GSTR2A MISMATCH , SAYS SUPREME COURT appeared first on GST Platform.