RECENT DEVELOPMENTS IN GST

[Dr. Sanjiv Agarwal]

Union Budget 2024-25 is now a reality and various stakeholders are analyzing it from different perspectives. While there appears to be some pain points in direct taxes like LTCG, TDS etc. an attempt is seen towards simplification of provisions in GST. However, there is not much for professionals and middle class of the country.

GST is expected to constitute about 18% of total revenue whereas other indirect taxes may fetch about 10%. The amendments carried out in GST law are based on GST Council’s recommendations. It has been said that a comprehensive review of rates shall be done in next 6 months time to rationalize and simplify for ease of trade, removal of duty inversion and reduction of disputes. On a broader overview, budget is seen as a vision document for next five years.

CBIC Chairman has stated that every month, Government is collecting on an average Rs. 1150 crores as GST on online games. He also confirmed that Centre has stopped issuing press releases for GST collection data. According to data released by GSTN on 28 July, 2024, June GST Collection stood at Rs. 1,73,813 crore. Gross GST collection in July, 2024 in higher by 10.3% compared to July, 2023 collection. Now onwards, the data regarding GST collection will be placed as update on the GST portal only. Tax revenue as well as tax revenue as percentage to GDP is also on a rise.

Further, it has been stated that indirect tax structure will move towards minimum tax slabs and that existing classification under GST and customs shall be overhauled. In GST, 3 slabs is feasible which is a median slab, a lower slab for the goods and services for common man and a higher rate slab for items used by the affluent class.

Recenlty, larger bench of Apex Court in majority decision (8:1) held that state’s power to tax is not limited by Parliament’s Mines and Minerals (Development and Regulation) Act, 1957. It thus held that royalty paid by mining companies to the Central Government is not a tax.

The constitution of GST Appellate Tribunal in India seem to be happening soon. MoF has issued notification for constitution of state benches on 31^st July, 2024. Further, the appointment process for members (both technical and judicial) is already on.

GSTAT Authorities

• Government of India has notified Appointing Authority, Disciplinary Authority and Appellate Authority in respect of GSTAT.
• President of India has directed for such notification in terms of Central Civil Services (Classification, Control and Appeals) Rules, 1965 in respect of ‘Group B’ and ‘Group C’ services as follows:

S.No.	Description of Service	Appointing Authority	Authority competent to impose penalties and penalties which it may impose (with reference to item  numbers in rule 11 of the Central Civil Services (Classification, Control and Appeal) Rules, 1965)		Appellate Authority
			Authority	Penalties
1	All Group “B” posts in the Goods and Services Tax Appellate Tribunal (GSTAT)	President of Goods and Services Tax Appellate Tribunal and in his absence the Judicial Member of the Principal Bench of the Goods and Services Tax Appellate Tribunal	President of Goods and Services Tax Appellate Tribunal and in his absence the Judicial Member of the Principal Bench of the Goods and Services Tax Appellate Tribunal	All	Secretary, Department of Revenue, Ministry of Finance
2.	All Group “C” posts in the Goods and Services Tax Appellate Tribunal (GSTAT)	Registrar of Goods and Services Tax Appellate Tribunal and in his absence the Joint Secretary, Department of Revenue, Ministry of Finance	Registrar of Goods and Services Tax Appellate Tribunal and in his absence the Joint Secretary, Department of Revenue, Ministry of Finance	All	President, Goods and Services Tax Appellate Tribunal

 

(Source: Notification F. No. A-50050/99/2018-CESTAT-DOR-DOR dated 28.07.2024)

GST Appellate Tribunal (GSTAT) Benches

• Ministry of Finance has notified establishment of GST Appellate Tribunal and its benches.
• It has established the Goods and Services Tax Appellate Tribunal (GSTAT), with effect from the 1st day of September, 2023.
• It has constituted the Principal Bench of the Goods and Services Tax Appellate Tribunal (GSTAT) at New Delhi.
• It has notified the constitution of state benches with its location and setting / circuit benches
• While most of the states will have one bench each, States like Gujarat, Karnataka, Rajasthan, Tamil Nadu & Puducherry will have 2 benches each.
• Maharashtra & Goa and UP will have 3 benches each.
• Andaman & Nicobar, Sikkim and West Bengal will together have 2 benches
• There will be sitting / Circuit benches at specified locations which shall be operational in such manner as the President may order, depending upon the number of appeals filed by suppliers in the respective States/jurisdiction.
• The additional sitting associated with the Bench shall be operated by one Judicial Member and one Technical Member.

[Source: Notification dated 31.07.2024 (F. No. A-50050/150/2018-CESTAT-DoR)

issued by Department of Revenue, Ministry of Finance]

GSTN Advisory on Tax Refund by CSD

• GSTN has developed an online functionality to enable CSDs to file an application for refund in FORM GST RFD-10A in GST common portal for online processing of refund application filed by Canteen Stores Department (CSD) [Refer CBIC Circular No. 227 dated 11.07.2024]
• GSTN has issued an Advisory for refund of tax paid on inward supply of goods by CSD in Form GST RFD 10A by following the prescribed process. Accordingly,

• Login into the GST portal. Click on Services -> Refund -> Application for Refund.
• Select "Refund of tax paid on Inward supply of goods by Canteen Store Department (CSD)".
• Select Period for which refund is to be applied, by selecting From & To Period and then clicking on "Create Refund" application.
• The refund applications on GST portal are to be filed sequentially with respect to tax periods.
• If there is no refund to be claimed for a particular period, CSD needs to file a NIL refund claim for that period.
• Once a refund is filed or NIL refund claim is filed for a particular period, the system will not allow filing for the same period again.
• It will also not allow the taxpayer to file for any previous periods.
• The select period is available from July 2017. If a taxpayer has already filed manual refund claims for the earlier periods or no refund claim is required to be filed for the earlier periods, they are advised to file NIL refund claim for such earlier periods.
• Once a NIL refund claim is filed in the GST system for a period, the CSD cannot claim a refund for the same period again in the GST system.
• The details of invoices for which refund is to be claimed shall be uploaded in the Statement. After successful validation of the statement, click on Proceed button.
• The total tax paid on Inward supply of goods will be auto-populated. Enter the value of IGST, CGST and SGST in "Total Refund applied for" table.
• While filing refund application, the applicant has to Select the "Bank Account number" in which the refund is to be disbursed.
• Before submitting the refund application, the applicant can Save & Preview the refund application.
• Once the application is submitted using the Submit button, system will not allow any change in the refund application.

 

(Source: GSTN Advisory dated 22.07.2024)

New Form GSTR-1A to amend GSTR-1

• GSTN has issued on advisory for Form GSTR-1A notified vide Notification No. 12/2024-CT dated 10.07.2024 to add or amend particulars of a supply of the current tax period, which was missed out or was wrongly reported in FORM GSTR-1 of the said tax period, before filing of the GSTR-3B return of the said tax period.
• FORM GSTR-1A would be available to all the taxpayer from August 2024, through which details furnished in FORM GSTR-01 for the month of July 24 can be amended.
• FORM GSTR-1A is an optional facility and can be filed only once for a particular tax period.
• The corresponding effect of the changes made through FORM GSTR-1A on the liability of the taxpayer shall be reflected in FORM GSTR-3B for the same tax period.
• At the recipient end, the ITC for the supplies declared or amended by the suppliers through FORM GSTR-1A will be available to the recipient in FORM GSTR-2B generated for the next tax period.
• It contains advisory for taxpayers filing form GSTR-1 on monthly basis and quarterly basis. Taxpayers may refer to the same.
• In case where change is required to be made in GSTIN of a recipient for a supply reported in FORM GSTR-1 of a tax period, the same can be rectified through FORM GSTR-1 for the subsequent tax period only.

(Source: GSTN Advisory dated 26.07.2024)

GST collection in June, 2024

• GSTN has released data for gross and net GST collection for the month of June, 2024 on 28.07.2024.
• Total gross GST revenue for June, 2024 is Rs. 1,73,813 crore with a YoY growth of 7.63 % (June 2023 - Rs. 1,61,497 crore).
• Total gross cumulative collection of GST upto June is at Rs. 5,56,818 crore
• Net monthly GST revenue net of refunds and including imports revenue stood at 1,53,867 crore (cumulative Rs. 4,90,082 crore).

 

(Source: GSTN Revenue Report dated 28.07.2024)

GST collection in July, 2024

• GSTN has released the data on GST collection for the month of July, 2024 recording a third highest ever collection of Rs. 1.82 lakh crore.
• Gross GST collection in July, 2024 in higher by 10.3% compared to July, 2023 collection (Rs. 1.66 lakh crore)
• Net GST collection rose by 14.4% to Rs. 1.66 lakh crore.
• While states like Maharashtra, Karnataka, Gujarat and Delhi reported a double digit growth on YoY basis, few states have shown negative growth which include Himachal Pradesh, Meghalaya, Lakshadweep, Madhya Pradesh, Sikkim etc.
• It is expected that GST collection may rise further in coming months due to festive session ahead.

(Source: GSTN Revenue Report dated 01.08.2024)