Recommendations of 49th GST Council Meeting - Tribunal and Amnesty!

GST Appellate Tribunal

The Council adopted the report of the Group of Ministers with certain modifications. The final draft amendments to the GST laws shall be circulated to Members for their comments. The Chairperson has been authorized to finalize the same.

Finally, a decision has been taken. Now, "Wo din ab dhoor nahi". We hope this will be expedited as various HC have taken a strict stand on the absence of Tribunals.

For Pan masala, gutkha, and chewing tobacco

Approval of the Report of GoM on Capacity-Based Taxation and Special Composition

What is this about? Let's understand the background first.

A group of ministers (GoM) tasked by the?Goods and Services Tax?(GST) Council to look into capacity-based taxation for evasion-prone commodities like pan-masala and gutkha has proposed a “specific tax-based levy”, which is to be linked to their retail prices.

At present, these commodities attract 28 percent?GST?plus an ad valorem compensation cess.

The panel observed greater revenue leakages existed at the later stages of the supply chain of such commodities, and since most of the end retailers are small and below the threshold limit for mandatory?GST?registration, it is difficult to trace them.

Consequently, the panel decided there was a need to move to specific tax-based levies to boost the first-stage (manufacturer-level) collection of the revenue. Additionally, such a specific tax shall be linked to the retail sale price to maintain revenue buoyancy as well.

Recommendations relating to GST rates

• The rate on the?‘Rab’ (liquid jaggery),?which is at?18%?has been reduced to?5%?- if sold prepackaged and labeled.?Nil?- if sold otherwise
• On?Pencil Sharpner,?it has been reduced from 18% to 12%.
• Notification No. 104/94-Customs dated 16.03.1994?exempts the containers which are durable in nature, now if a device like a tag-tracking device or data logger is already affixed on a container no separate IGST shall be levied on the such affixed device.?In a few cases, the Custom contended the levy, so this amendment will bring clarity now.
• Sl. No. 41A of notification No. 1/2017- Compensation Cess (Rate)?Exemption benefit will be available in the cases where coals rejects supplied?to?and?by?a coal washery, arising out of coal on which compensation cess has been paid and no input tax credit thereof has been availed by any person.
• The exemption is available to educational institutions and Central and State educational boards for the conduct of?entrance examinations?to any authority, board, or body set up by the Central Government or State Government including the?National Testing Agency for the conduct of entrance examination for admission to educational institutions.
• In respect of taxable services supplied by Courts and Tribunals such as renting of premises to telecommunication companies for the installation of towers, renting of the chamber to lawyers, etc., the Reverse Charge Mechanism will be there.

Measures for facilitation of trade

Extension of time limit for application for revocation of cancellation of registration and time amnesty for past cases:

1. Section 30 of CGST Act, 2017 and rule 23 of CGST Rules, 2017 are amended to increase the time limit to file the?application for revocation of cancellation?of registration from?30 days to 90 days; (Further extendable by 180 days)
2. An amnesty?for past cases, where registration has been canceled on account of non-filing of the returns, but revocation was not filed within time. Thus, now the revocation of cancellation of registration will be allowed to file.
3. Amendment to Section 62 of CGST Act, 2017 (Best Judgement Assessment)?As per sub-section (2) of section 62 of CGST Act, 2017, the best judgment assessment order issued under sub-section (1) of the said section is deemed to be withdrawn if the relevant return is filed within 30 days of service of the said assessment order. Now, the time limit has been extended from?30 to 60 Days?(Further extendable by 60 days). This benefit will be extended to?past cases?where the return was not filed within 30 days from the assessment order.

Rationalization of Late fee for Annual Return (GSTR-9)

Presently, a late fee of Rs 200 per day (Rs 100 CGST + Rs 100 SGST), subject to a maximum of 0.5% of the turnover in the State or UT (0.25% CGST + 0.25% SGST), aggregate turnover in a financial year?upto Rs 20 crore, as below:

1. Registered persons having?an aggregate turnover < 5 crores?in the said financial year:?Rs 50 per day (Rs 25 CGST + Rs 25 SGST), subject to a maximum of an amount calculated at?0.04 percent. of his turnover in the State or Union territory?(0.02% CGST + 0.02% SGST).
2. If turnover is between 5 Crore and 20 Crore: Rs 100 per day (Rs 50 CGST + Rs 50 SGST),?subject to a maximum of an amount calculated at?0.04 percent. of his turnover in the State or Union territory?(0.02% CGST + 0.02% SGST).

Amnesty in respect of pending returns in FORM GSTR-4, FORM GSTR-9, and FORM GSTR- 10

To provide relief to a large number of taxpayers, the Council recommended amnesty schemes in respect of pending returns in FORM GSTR-4, FORM GSTR-9, and FORM GSTR-10 by way of conditional waiver/ reduction of late fee.

Rationalization of provision of a place of supply of services of transportation of goods

Section 13(9) of IGST Act, 2017 will be deleted so as to provide that the place of supply of services of transportation of goods, in cases where the location of the supplier of services or the location of the recipient of services is outside India,?shall be the location of the recipient of services.?Earlier, the Place of Supply in such cases was the?'Destination of Goods'.

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