The Finance Minister submitted interim budget for the year 2024 - 2025 on 01.02.2024. There are no much changes either in the direct tax laws as well as indirect tax laws. There is no change in Customs Act. There is no change in the income tax rates.
The following are the changes in respect of GST Act-
- Change in definition of the expression ‘input service distributor’ - As per the substitution of Section 2(61) of the Central Goods and Services Tax Act. 2017 (‘Act’ for short), the expression ‘input service distributor’ (‘ISD’ for short) is defined as 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 Section 9(3) or 9(4), for or on behalf of distinct persons and liable to distribute the input tax credit in respect of such invoices in the manner provided in section 20.
- Manner of distribution of input tax credit - The Finance Bill, 2024 substituted section 20 of the Act which provides the manner of distribution of input tax credit by Input Service Distributor. The newly substituted section 20 provides that-
- Any 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 section 9(3) or 9(4), for or on behalf of distinct persons shall be required to be registered as ISD under section 24 (viii) and shall distribute the input tax credit in respect of such invoices.
- The ISD shall distribute the credit of central tax or integrated tax charged on invoices received by him, including the credit of central or integrated tax in respect of services subject to levy of tax under section 9(3) or 9(4) paid by a distinct person registered in the same State as the said ISD, in such manner, within such time and subject to such restrictions and conditions as may be prescribed.
- The credit of central tax shall be distributed as central tax or integrated tax and integrated tax as integrated tax or central tax, by way of issue of a document containing the amount of input tax credit, in such manner as may be prescribed.
- Penalty for failure to register certain machines used in manufacture of goods as per special procedure - The Finance Bill proposed to insert a new section 122A. The newly inserted Section 122A provides penalty for failure to register certain machines used in manufacture of goods as per special procedure.
The newly introduced section 122A (1) provides that where any person, engaged in the manufacture of goods in respect of which any special procedure relating to registration of machines has been notified under section 148, acts in contravention of the said special procedure, he shall, in addition to any penalty that is paid or is payable by him under Chapter XV or any other provisions of this Chapter, be liable to pay a penalty equal to an amount of Rs.1 lakh for every machine not so registered.
The newly inserted Section 122A (2) provides that in addition to the penalty under sub-section (1), every machine not so registered shall be liable for seizure and confiscation. Such machine shall not be confiscated where-
- the penalty so imposed is paid, and
- the registration of such machine is made in accordance with the special procedure within three days of the receipt of communication of the order of penalty.
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