GLS | Beyond Facts

Key Highlights of 48th GST Council Meeting

The 48th GST Council meeting has concluded on 17 December 2022 under the chairmanship of the Smt. Nirmala Sitharaman. While not all the points in the agenda could be discussed during the meeting, a number of key recommendations have been made. Following are key highlights of the recommendations made in the Meeting:

• Amendment in Rule 37 of the CGST Rules retrospectively with effect from 01 October 2022 to provide for reversal of ITC proportionate to the amount not paid to the supplier vis-à-vis the value of the supply, including tax payable;
• Insertion of a new Rule to prescribe the mechanism of reversal of ITC non-payment of tax by the supplier by a specified date and mechanism for re-availment of such credit, if the supplier pays tax subsequently;
• Decriminalization of certain offences under GST;
• Facility for withdrawal of Appeals under GST at certain specified stages for reducing the litigations;
• GSTR-1 to be amended to provide for reporting of details of supplies made through Electronic Commerce Operators;
• Amendment under the CGST Rules to prescribe the procedure for filing refund application by unregistered persons in cases where certain contract/ agreement for supply of services, is cancelled and the time period of issuance of credit note by the concerned supplier is over;
• Rate rationalization on certain pulses and motor spirit.

GLS Comments:

Currently, Section 16(2) of the CGST Act as well as Rule 37 of the CGST Rules does not mention the word 'proptionate' in respect of reversal of ITC in case of non-payment of dues to suppliers within 180 days. This amendment therefore would be welcome by the Trade and Industry. Nonetheless, the validity of such provision u/s. 16(2) of the CGST Act is still under judicial review. Accordingly, the fate if this provision is still unclear.

Further, the facility for withdrawal of Appeal would also ensure that no unnecessary litigation would burden the appellate authorities. However, what the Trade and Industry awaited from this meeting was clarifications in respect of formation of GSTAT and tax applicability on online gamings. It is understood that on account of paucity of time, the same could not be discussed. It is expected that these discussions would be taken up in the next meeting.??