Goods & Service Tax

 The GST Council met for the 55th time on December 21, 2024 in Jaisalmer and made recommendations on various matters including legislative changes, GST rates on specified goods and services, clarifications on contentious issues, measures aimed at trade facilitation. The GST Council, however, deferred several decisions like overall rate rationalisation, GST on life and health insurance premiums etc. This Alert gives an insight on the key recommendations from this meeting: A. Legislative Changes A1. ITC on construction of immovable property Ø   Section 17(5)(d) of the Central Goods and Services Tax Act, 2017 (‘CGST Act’) to be amended to replace the phrase ‘plant or machinery’ with the phrase ‘plant and machinery’ retrospectively, effective from July 1, 2017. Resultantly, the ITC restriction under Section 17(5)(d) will also be read with the Explanation defining ‘plant and machinery’, as provided under Section 17. Ø   This proposal comes in the light of recently pron...

GSTN issued very important Advisory for Waiver Scheme Under Section 128A of the CGST Act, 2017 The GSTN issued very important Advisory No. 546 dated November 08, 2024 for Waiver Scheme Under Section 128A of the CGST Act, 2017. For reducing the tax disputes and to provide a big relief to the taxpayers, GST Council in its 53rd meeting held on 22nd June, 2024 had recommended for waiver of interest and penalties in the demand notices or orders issued under Section 73 of the CGST Act, 2017 (i.e. the cases not involving fraud, suppression or wilful misstatement, etc.) for the Financial years 2017-18, 2018-19 and 2019-20. To avail this waiver, the condition is that the full tax demanded is paid on or before 31.03.2025. In view of the above, Rule 164 of CGST rules, 2017 was notified through Notification No. 20/2024 dated. 8th October 2024, effective from 1st November 2024. This rule provides procedural guidelines for the said waiver scheme. As per the waiver scheme, if a notice or order is iss...

  Ref:- CBIC Notification No. 09/2024-Central Tax (Rate), Dt. 08-10-2024. Please refer the Notifications cited. You are hereby informed as follows. Vide reference cited, ‘service by way of renting of any property other than residential dwelling’ by an un-registered person is notified as liable for payment of tax by the recipient on reverse charge basis . The Notification has come into force on 10th October 2024. Therefore, you are requested to ensure that the tax on reverse charge basis is accounted for and paid on the rental / lease charges of the commercial property taken on rent / lease from un-registered person..

Major #GST Update from 1 Nov 2024 Starting from 1st November 2024, a new compliance rule 47A is coming into effect for #SelfInvoicing in cases of Reverse Charge Mechanism (RCM). Under the Finance Act 2024 (Part 2) and Notification 20/2024, all GST-registered recipients liable under RCM must issue self-invoices within 30 days of supply receipt. Previously, there was no clear time limit, leading to confusion. This change aims to bring consistency and ensure timely tax compliance. Why This Matters: Failing to comply could lead to penalties, so it’s crucial to update your processes! Key Points: - New 30-day time limit for RCM self-invoices. -Effective from 1st November 2024. - Non-compliance may result in penalties. FORMAT OF SELF INVOICE:

Action Points for October 2024 GST Return pertaining to FY 2023-24: 1. Reconcile ITC for FY 2023-24 and avail ITC of FY 2023-24 if any pending to avail. 2. Notify the suppliers about any ITC not reflected in GSTR-2B but for which goods/services have been received during 2023-24 before filing his GSTR 01. 3. Calculate the common ITC for FY 2023-24 and do the reversal as per Rule 42 and Rule 43 of the CGST Rules. 4. Check all vendor payments have been made within 180 days for FY 2023-24. If not, reverse the ITC with interest and re-avail in the month payment is actually made. 5. Ensure ITC for inputs and capital goods is correctly identified and recorded in the books for the disclosure in Table 6 of GSTR-9. 6. Make sure all outward supplies of FY 2023-24 are reported and if any transaction is left, please report in GSTR 01 of October 2024.

Gist of CBIC notifications issued dated 08.10.2024 Notification No. 21/2024–Central Tax   This notification details the procedure and conditions for waiving interest or penalties regarding tax demands under Section 73 of the CGST Act for the financial years 2017 to 2020, as per Section 128A.   Notification No. 22/2024–Central Tax   The CBIC specifies the mechanism for the implementation of newly inserted subsections (5) and (6) in Section 16 of the CGST Act. To clarify the conditions under which input tax credit (ITC) can be availed- against whom any order under section 73 or section 74 or section 107 or section 108 of the said Act has been issued confirming demand for wrong availment of input tax credit, on account of contravention of provisions of sub-section (4) of section 16 of the said Act, but where such input tax credit is now available as per the provisions of sub-section (5) or sub-se...

Summary of the key points discussed in the 54th GST Council meeting today: 1. Goods: Namkeens and Extruded/Expanded Savoury Food Products: GST rate reduced from 18% to 12% for extruded/expanded savoury products (except un-fried/un-cooked snack pellets). Cancer Drugs: GST rate on Trastuzumab Deruxtecan, Osimertinib, and Durvalumab reduced from 12% to 5%. Metal Scrap: Reverse Charge Mechanism (RCM) introduced for supply of metal scrap by unregistered persons to registered persons; TDS of 2% on supply by registered persons . Railway AC Units: Roof Mounted Package Unit (RMPU) air conditioning machines for railways to attract 28% GST. 2. Services: Life and Health Insurance: Group of Ministers (GoM) to study GST issues on life and health insurance and report by October 2024. Passenger Transport by Helicopter: GST @ 5% on helicopter passenger transport (seat share); 18% for charter services. Flying Training: Approved flying training courses by DGCA-exempted organizations exempted from GST. Re...