GST Laws Recent Changes - Dec 2018

The following recommendations have been made in the 31st GST Council Meeting on the 22nd of December, 2018.

Single Cash Ledger: There would be a single cash ledger for each tax head. The modalities for implementation would be finalised in consultation with GSTN and the Accounting authorities. For Example: The three tax ledgers i.e. Credit, Liability and Cash will be merged into one ledger for each tax head such as IGST, SGST/UTGST CGST and Cess.

Late Fee Waiver: for all the GST returns yet to be filed as on 22nd December 2018 up to 31st March 2019, for the months July 2017 up to September 2018

ITC for 2017-18: Time to claim the Input tax credit for FY 2017-18 allowed up due date of filing GSTR-3B of March 2019, subject to conditions.

New Return Filing System: To be started on a trial basis from April 1, 2019, and will be to be implemented by July 1, 2019

GSTR-9 & 9C Due Date Extended: The due date for furnishing the annual returns in FORM GSTR-9, FORM GSTR-9A and reconciliation statement in FORM GSTR-9C for the Financial Year 2017 – 2018 shall be further extended till 30.06.2019.

Changes in Annual Return: The following clarificatory changes, inter-alia, shall be carried out in the formats/instructions according to which the annual return / reconciliation statement is to be submitted by the taxpayers:

- Amendment of headings in the forms to specify that the return in FORM GSTR-9 & FORM GSTR-9A would be in respect of supplies etc. ‘made during the year’ and not ‘as declared in returns filed during the year

- All returns in FORM GSTR-1 & FORM GSTR-3B have to be filed before filing of FORM GSTR-9 & FORM GSTR-9C

- All returns in FORM GSTR-4 have to be filed before filing of FORM GSTR-9A

- HSN code may be declared only for those inward supplies whose value independently accounts for 10% or more of the total value of inward supplies

- Additional payments, if any, required to be paid can be done through FORM GST DRC-03 only in cash

- ITC cannot be availed through FORM GSTR-9 &FORM GSTR-9C

- All invoices pertaining to previous FY (irrespective of month in which such invoice is reported in FORM GSTR-1) would be auto-populated in Table 8A of FORM GSTR-9;

- Value of “non-GST supply” shall also include the value of “no supply” and may be reported in Table 5D, 5E and 5F of FORM GSTR-9

- Verification by taxpayer who is uploading reconciliation statement would be included in FORM GSTR-9C

GSTR-8 Due Date Extended: The due date for furnishing FORM GSTR-8 by e-commerce operators for the months of October, November and December, 2018 shall be extended till 31.01.2019.

ITC-04 Due Date Extended: The due date for submitting FORM GST ITC-04 for the period July 2017 to December 2018 shall be extended till 31.03.2019.

Online Refund Filing: All the supporting documents/invoices in relation to a claim for refund in FORM GST RFD-01 shall be uploaded electronically on the common portal at the time of filing of the refund application itself, thereby obviating the need for a taxpayer to physically visit a tax office for submission of a refund application. GSTN will enable this functionality on the common portal shortly.

RFD-01A for Other Refunds: The following types of refunds shall also be made available through FORM GST RFD-01A:

- Refund on account of Assessment/Provisional Assessment/Appeal/Any Other Order

- Tax paid on an intra-State supply which is subsequently held to be inter-State supply and vice-versa

- Excess payment of Tax

- Any other refund

Refund Clarifications: Clarifications shall be issued on certain refund related matters like refund of ITC accumulated on account of inverted duty structure, disbursal of refunds within the stipulated time, time allowed for availment of ITC on invoices, refund of accumulated ITC of compensation cess etc.

E-Way Bill Restriction for Non Filers: Taxpayers who have not filed the returns for two consecutive tax periods shall be restricted from generating e-way bills. This provision shall be made effective once GSTN/NIC make available the required functionality

GST Migration Completion: One more window for completion of migration process is being allowed. The due date for the taxpayers who did not file the complete FORM GST REG-26 but received only a Provisional ID (PID) till 31.12.2017 for furnishing the requisite details to the jurisdictional nodal officer shall be extended till 31.01.2019. Also, the due date for furnishing FORM GSTR-3B and FORM GSTR-1 for the period July, 2017 to February, 2019/quarters July, 2017 to December, 2018 by such taxpayers shall be extended till 31.03.2019.

Appellate Authority for Advance Ruling: Creation of a Centralized Appellate Authority for Advance Ruling (AAAR) to deal with cases of conflicting decisions by two or more State Appellate Advance Ruling Authorities on the same issue.

Interest Computation: Amendment of section 50 of the CGST Act to provide that interest should be charged only on the net tax liability of the taxpayer, after taking into account the admissible input tax credit, i.e. interest would be leviable only on the amount payable through the electronic cash ledger.

Composition Scheme for Service Providers: The council unanimously approved the scheme for small scale service providers. The rates and threshold limit for this scheme shall be decided in forthcoming meetings.

Rate Changes:

List of Rate Changes at 31st GST Council Meeting
S.No.	List of Goods/Services						Change in Tax Rate
1	Vegetables, (uncooked or cooked by steaming or boiling in water), frozen, branded and put in a unit container						5% to Nil
2	Vegetable provisionally preserved (for example by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), but unsuitable in that state for immediate consumption
3	Music Books						12% to Nil
4	Natural Cork						12% to 5%
5	Fly-Ash Blocks
6	Walking Sticks
7	Marble Rubble						18% to 5%
8	Cork roughly squared or debagged						18% to 12%
9	Articles of natural cork
10	Agglomerated cork
11	Movie Tickets < or = INR 100
12	Premium on Third Party Insurance on vehicles
13	Parts and accessories for the carriages for disabled persons						28% to 5%
14	Pulleys, transmission shafts and cranks, gear boxes etc., falling under HS Code 8483						28% to 18%
15	Monitors and TVs of upto screen size of 32 inches
16	Re-treaded or used pneumatic tyres of rubber
17	Power banks of lithium ion batteries. Lithium ion batteries are already at 18%. This will bring parity in GST rate of power bank and lithium ion battery
18	Digital cameras and video camera recorders
19	Video game consoles and other games and sports requisites falling under HS code 9504.
20	Movie Tickets > INR 100
Exemptions
Services supplied by banks to basic Savings Account holders under Pradhan Mantri Jan Dhan Yojana (PMJDY) shall be exempted.
Note: Air travel of pilgrims by non-scheduled/charter operations, for religious pilgrimage facilitated by the Government of India under bilateral arrangements shall attract the same rate of GST as applicable to similar flights in Economy class (i.e. 5% with ITC of input services)

Note:  The requisite Notifications/Circulars for implementing the above recommendations of the GST Council shall be issued shortly.

Please also refer to the following link for rate changes: http://www.pib.nic.in/PressReleseDetail.aspx?PRID=1557065

The rate changes are applicable from 1st January, 2019.

Upcoming:

The GST Council may consider reducing of GST rate on under construction residential properties to 5%.

E-Way Bill in Delhi-NCR (Delhi, Haryana, UP)

What is E-Way Bill?

E-Way Bill is an electronically generated bill which is required to be generated by a registered person who intends to initiate the movement of goods in India from one place to another (both inter-state and intra-state), the value of which per invoice is more than Rs. 50,000 with the exception of Delhi where the value shall be more than Rs. 1 lac.

The bill is required to be carried by the carrier of a consignment.

Upon generation of the e-way bill on the common portal (http://ewaybill.nic.in), a unique e-way bill number (EBN) shall be made available to the supplier, the recipient and the transporter on the common portal.

Applicability of E-Way Bill

Who, When and How 

Who

Registered Person who causes the movement of goods of consignment of more than Rs 50,000 in value.
- in relation to supply (eg. sales)
- for reasons other than supple (eg. sales return, branch transfers, etc.)
- due to inward supply from unregistered person

Unregistered Persons are also required to generate e-Way Bill. However, where a supply is made by an unregistered person to a registered person, the receiver will have to ensure all the compliances are met as if they were the supplier.

Transporters carrying goods by road, air, rail, etc. need to generate eway bill if neither the consignor nor the consignee generates the eway bill and the value of goods is more than Rs. 50,000.

They can enroll themselves on the e-way bill portal (https://ewaybillgst.gov.in) and generate the 15 digits Unique Transporter Id.

The transporters however are not obligated to generate the eway bill where all the consignments in the conveyance are
- individually (single invoice/bill/delivery challan) ≤ Rs. 50,000 but
- in aggregate (of all invoices/bills/delivery challans) > Rs 50,000

If the transporter is transporting multiple consignments in a single conveyance, Form GST EWB-02 can be used to produce a consolidated e-way bill, by providing the e-way bill numbers of each consignment.

When

- Value of goods is more than Rs. 50,000
- Inter-state movement of goods for Job Work irrespective of the value of consignment
- Inter-state movement of handicraft goods irrespective of the value of consignment

In case of transport by road - generated before the movement of goods
In case of transport by railway, air or vessel - generated before or after the movement of goods

Notes:

The railways shall not deliver the goods until e-way bill is produced.

The consignment value of goods for the purpose of e-way bill generation shall be the value declared in an invoice/bill of supply/delivery challan, as the case may be, including tax and cess as mentioned in the document and excluding the value of exempt supply of goods where the invoice is issued in respect of both exempt and taxable supply of goods.

Consignment Value = Invoice Value + Taxes - Value of Exempt Goods

How

Furnishing information related to transaction in Part A of Form GST EWB-01
Furnishing information related to transport in Part B of Form GST EWB-01

Validity

The validity is dependent on the distance travelled by the goods since the generation of e-way bill.

Notes:

Validity of one day will expire at midnight of the day immediately following the date of generation of e-way bill. 

The validity of an e-way bill can be extended by the generator either 4 hours before expiry or within 4 hours after its expiry.

Where, under exceptional circumstances, the goods cannot be transported within the validity period, the transporter may generate another e-way bill after updating the details in Part B of Form GST EWB-01.

In case of import or export of goods, the approximate distance for movement of consignment from the source to destination has to be considered based on the distance within the country i.e. in case of export, the consignor place to the place from where the consignment is leaving the country, after customs clearance and in case of import, the place where the consignment is reached the country to the destination place and cleared by Customs.

Non-Applicability of E-Way Bill

1. Goods of value less than Rs. 50,000 (except in specified mandatory applicability eg. movement of handicraft goods and movement of goods for inter-state job work)

2. Goods are being transported by a non-motorised conveyance (eg. manual carts, horse carts, etc.)

3. Goods are being transported:

• from the port, airport, air cargo complex and land customs station to an inland container depot (ICD) or a container freight station (CFS) for clearance by Customs
• from ICD or CFS to a customs port, airport, air cargo etc under customs bond
• from one customs port/station to another one under customs bond
• under the customs supervision or customs seal

4. Goods transported within the notified area

5. Goods transported are transit from/to Nepal or Bhutan

6. Goods are transported to a weighbridge within 20kms and back to the place of business by being covered under a Delivery Challan

7. Where Government or local authorities transport goods by rail as a consignor

8. Goods transported are to/from the Ministry of Defence

Notes:

In case of movement of goods from the place of consignor to the place of transporter up to a distance of 50 km does not require filling of PART-B of e-way bill. However, Part-A needs to be generated.

E-Way Bill in Uttar Pradesh

Intra-State implementation of e-way bill for Uttar Pradesh commenced from 15th April 2018.

The Commercial Taxes Department of Uttar Pradesh has prescribed one or more of the following documents/certificates:

TDF - (Transit Declaration Form) for goods of other states that pass through UP while in transit.

Every goods vehicle that passes into/through UP is required to be registered on the portal after which TDF-1 and TDF-2 can be generated.

TDF - 1

Every heavy vehicle, passing through UP, is required to generate transit form in TDF-1, while entering UP.

The form shall require particulars relevant to the goods and the transportation of goods and is to be carried while traveling in UP, for verification at any point in time.

TDF - 2

This form has to be generated within 24 hours of the vehicle exiting UP to utilize TDF -1.

E-Way Bill-01 (Import Declaration Form) for heavy vehicles transporting goods from other States into Uttar Pradesh for delivery.

E-Way Bill-02 (Transport Memo) for movement of goods from UP to any other state or for movement of goods within the state between two cities in UP.

E-Way Bill-03 (Declaration Form) for movement of goods by e-commerce operators within UP.

Validity

E-Way bill TDF remains valid for a period of 4 days from the date of its generation.

 

E-Way Bill in Delhi

Delhi became the last to implement intra-state e-way bill amongst all the states in the country. 

With effect from the 16th day of June, 2018 e-way bill shall be required in respect of intra-state movement of goods in Delhi, without passing through any other state, where the consignment value of the goods being transported exceeds Rs. 1 lac.

This shall be applicable only in case of B2B transactions above Rs. 1 lac only, i.e. B2C transactions of any value shall not require e-way bill for intra-state movement in Delhi.

Contributed by:
Ms. Kashika Ahuja

Member, GST Core Team

Sandeep Ahuja & co.

TDS Notices, Defaults, Penalties, Interest and Online Correction of 26QB – TDS on sale of Immoveable Property

TRACES is the site where we can generate 26QB – TDS on sale of Immoveable Property make corrections and generate TDS Certificates for TDS deducted by the buyer of property

TDS is applicable on transfer of Immovable property under section 194IA enacted by Finance Act 2013 where the consideration of property exceeds or is equal to 50 lacs. TDS Provisions for Property Sale/ Purchase above 50 Lacs are as under:

1)     WEF 1st June, 2013 Tax @ 1% should be deducted by the buyer of the property at the time of making payment of sale consideration.

2)     For furnishing of Information of such transaction a 26QB form is to be filed online containing PAN of seller as well as buyer & Address, Transaction value and date of agreement for such transaction. In case of more than 2 buyers or sellers the Challan and Form 26QB will be filled in by all the buyers for respective sellers for their respective share.

3)     Any sum so deducted under section 194 IA shall be required to be paid to the credit of the Central Government within a period of seven days from the end of the month in which the deduction is made either through Net Banking or through Authorized Bank Branches.

4)     TDS certificate in Form 16B is required to be issued by the Buyer of property to the Seller, in respect of the taxes deducted and deposited in Government Account.

5)     Challan and Form 26QB will be filled in by all the buyers for respective sellers for their respective share.

6)     If the person liable to deduct tax does not file 26QB and deposits the Tax Deducted in time will be treated as Assessee in default and shall be liable to pay Interest under section 201 of Income Tax Act,1961 before furnishing the Form 26QB

(a)   In case of TDS Deducted but Not paid in Time @1.5% for every month or part of a month on the amount of such TDS from the date on which such TDS was deducted to the date on which such TDS is actually paid.

(b)   In Case TDS is not deducted @1% for every month or part of a month on the amount of such tax from the date on which such TDS was deductible to the date on which such TDS is deducted.

7)     No filing or late filing of statement of TDS / TDS returns in Form 26QB the Assessee in Default shall be liable to pay late fees under section 234E @ Rs 200 per day till the failure to file TDS statement continues with challan within a period of seven days from the end of the month in which the deduction is made.

8)     The late filing fees shall be deposited before filing the TDS return in Form 26Q but the total fee cannot exceed the amount of TDS deductible for which statement was required to be filed filing fee.

9)     No filing or late filing of statement of TDS / TDS returns in Form 26QB shall invite penalty under section 271H minimum Rs 10,000/- to Rs 1 lakh for not filing the TDS statement within one year from the specified date within which he was supposed to file the statement.

10) As Per section 271H, penalty will be levied if the deductor/collector files an incorrect TDS return minimum penalty of Rs. 10,000 and maximum penalty of upto Rs. 1,00,000/-. In Case TDS return is filed without payment of Penalty under section 271H it may be levied on deductor by the assessing officer.

11) TRACES is sending two types of notices:

 i) Demand of interest payment in case TDS is paid but interest is payable, and

ii) Demand of TDS and interest payment in case TDS is deducted or not deducted but not paid to the credit of the Central Government and TDS return in Form 26QB not filed.

Online Correction of 26QB

The CPC TDS released Online Correction facility for TDS statements filed in form 26QB, for TDS on transfer of Immovable Property where consideration exceeds Rs. 50 Lacs. The TRACES has given now Online Correction facility for closure of the following TDS Defaults due to incorrect data entry in the 26QB statement.

Steps for online correction in 26QB

·         Register at Traces.

·         Register your DSC.

·         Make Correction in the following Fields : PAN of Buyer Details, PAN of Seller Details, Amount Paid/Credited, Date of Payment / Credit, Date of Tax Deduction, Financial Year & Details of Property.

·         No DSC required for Corrections in the fields of email address, Mobile Number and Address of the Property.

·         In case a person does not have DSC then Assessing Officers’ Approval is required except for amendment in E Mail ID, Mobile and Address of the property.

Some important points related to correction of form 26QB

1) Bank Branches cannot do 26QB challan correction.

2) Assessing officers are not authorized for 26QB challan correction.

3) Correction only in select challan fields:

·         Buyer PAN

·         Seller PAN

·         Assessment Year

·         Major Head i.e.0020- Income tax on companies(Corporation Tax) and 0021- Income Tax(other then companies).

4) Challan fields that cannot be corrected: Correction is not possible for following relevant fields:

·         Total Value of Consideration (Property Value)

·         Minor head i.e. Type of Payment – 800 (TDS on Sale of Property)

·         Address

·         Property Details

·         Payment Details

·         TDS or Tax Deposit Details including penalty i.e. interest and Fee.

5) The Process of 26QB Challan Correction: For 26QB Challan Correction, a buyer has to submit the written application to the PAN Assessing Officer as per the jurisdiction of the buyer’s PAN. To know your PAN Assessing Office, please click on the following link : https://incometaxindiaefiling.gov.in/e-Filing/Services/KnowYourJurisdictionLink.html

6) NOC from seller: A buyer need NOC from the seller on an affidavit in original. This original NOC should be attached to the application for 26QB Challan Correction.

7) Correction Status: If your correction is approved by IT department then it will be reflected in the Form 26AS of the seller. A buyer may request the seller to check his/her Form 26AS for corrections.

TDS on Sale of Property, Delays & defaults in 26QB and

payment of TDS

The Buyer of Immovable Property (Other than rural agricultural land) is required to deduct tax on the rates applicable from the sales consideration payable to RESIDENT Transferor provided the sales consideration is equal to or more than Rs.50 Lacs.

Section 194IA would be applicable if any of the following conditions are satisfied:

1. If the transaction of sale is occurred on or after 1st June 2013 & sales consideration is equal to or exceeding Rs. 50 Lacs. OR

2. If the advance consideration received before 1st June 2013 is equal to or exceeding Rs. 50 Lacs but sale agreement is made after 1st June 2013.

Tax is to be deducted at Source at the time of payment or at the time of giving credit to transferor, whichever is earlier. So at the time of sale of property the tax can be deducted in installments or lump sum as per the date of agreement by the 7th of the subsequent month in which agreement is entered into for payment in installments or in lump sum but as per the date of payment. If any advance payment is being made, then tax is to be deducted at the time of such payment. If the payment is made in installments then tax is to be deducted on payment of each installment.

The Tax is deductible @ 1% of the consideration payable to resident transferor [if valid PAN is quoted]. If the seller does not provide valid PAN, then the tax is deductible @ 20%.

The tax deducted is to be deposited by challan cum statement on Form 26QB. In case

the property is held by joint owners, the provisions of Sec 194IA will still be applicable

because the threshold limit of Rs. 50 Lacs is property-wise and not transferee-wise.

Permanent Account Number (PAN) of the seller as well as buyer should be mandatorily

furnished in the online Form for furnishing information regarding the sale transaction. If the PAN of seller is not filled or wrongly filled, then TDS would be deducted @20%.

Procedure of depositing the Tax Deducted:

The buyer has to fill the details of buyer and seller in Form No. 26QB. After that, the buyer has to remit the tax deducted electronically. On receipt of payment confirmation, a nine digit alpha numeric acknowledgement no. would be generated and such acknowledgement no. is to be kept by the buyer. On successful payment, a challan containing CIN and payment details would be generated. Print this as it will be required at the time of registration as Tax Payer.

There are two options to make payment:

a) Online payment through net Banking.

b) E-Payment at a subsequent date.

In case a) option is selected then as soon as click for first option there is window to select the name of the bank from where the payment is to be made and then account details and other details a for E-payment are required. After successful payment the receipt is generated which is further required at the time of generating Form 16B i.e TDS Certificate.

In case b) option is selected then Acknowledgement slip for TDS on sale of immovable

property is generated having PAN of Buyer, PAN of Seller, 9 digit alpha numeric Acknowledgement number, Amount of TDS as well as last date of payment. Then second step in this option is to make payment which can be done by bankers on behalf of the Buyer of the property or otherwise e-payment can be made by Clicking on the given link:

https://onlineservices.tin.egov-nsdl.com/etaxnew/PopServletOffline

After clicking the above web page there are the following information is to be entered:

·         PAN of Buyer.

·         PAN of Seller.

·         Ack Number of Pre-generated 9 digit Alpha Numeric Acknowledgement Number.

·         Assessment Year which is subsequent to Fin. year in which property is purchased i.e Assessment Year is 16-17 for Financial Year 15-16.

Generally payment of TDS on Purchase of property is a huge amount so Income Tax

Department has given tutorials for the same.

There are E-Tutorials for TDS on Sale of Property:

E-Tutorial for making the on line payment or for subsequent payment please follow the given links respectively:

TDS on Property - e-tax payment immediately (through net banking)

TDS on Property - e-tax payment on subsequent date (through bank branches)

https://www.tin-nsdl.com/download/TDS/eTutorial_TDS%20on%20property_etax-subsequently.pdf

In case of failure to deposit the tax deducted, interest and penalty would be levied on the purchaser. Interest will be charged @ 1.5% per month or part of the month from the date of deduction to date of actual deposit. TDS CPC has raised the demands against delays and defaults in filing 26QB. TDS CPC has sent U/S 200A and raised demands under Section 156 for defaults and Section 234E for delays @ Rs.200/- per day.

Payment of Demand raised on delays and defaults:

Now TDS CPC has given the facility to make payment of demand raised against TDS on Sale of Property has been enabled.

To Pay Such Demand raised please click on

https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp

Contributed by Megha Bansal