GST MILESTONES: 2024 IN RETROSPECT

[Dr. Sanjiv Agarwal]

While 2024 has seen many changes in GST law, rules and tax jurisprudence including setting up and steps towards constitution of GSTAT benches, the new year 2025 is going to be a year of appellate reforms as we foresee commencement of functioning of GSTAT which will be a land mark step of GST era in 8^th year of GST. The fact remains that even, GST is a work-in-progress. GST as a tax has now entered into 8^th year as it was started from 1^st July, 2017. It is hoped that the law which is still evolving will gradually settle down with interpretations getting decided on Appellate forums.

2024: Milestones in GST 

01.02.2024	Union Budget, 2024 introduced key changes to the GST law inter alia including amendments in CGST Act, 2017 and IGST Act, 2017. Few major budget proposals – Amendment in the Definition of Input Service Distributor (ISD) [Section 2(61) of the CGST Act] - ISD to include distribution of ITC in respect of services, tax on which is liable to be paid under reverse charge mechanism. Amendment in the manner of distribution of ITC by the ISD (Section 20 of the CGST Act)- Any office of the Registered Person which receives common ITC will be mandatorily required to be registered as ISD and than distribute the ITC to distinct persons; Freedom will be provided for distribution of ITC of CGST as CGST or IGST and the ITC of IGST as IGST or CGST - at the option of ISD person transferring the ITC to distinct person; Time limit and conditions for distribution of ITC by ISD to be prescribed in Rules. Insertion of new section 122A for levying penalty in case failure to register certain machines used in manufacture of goods as per special procedure notified u/s 148 of CGST Act (i.e. Tobacco, Pan-masala and similar items)-New section 122A to prescribe penalty for not failure to register machines used in manufacture of goods as per special procedure.
03.04.2024	Self Enablement for E-Invoicing- If the taxpayer’s turnover exceeds INR 5 crores in the financial year 2023-2024, it is required to start e-Invoicing from the next financial year, i.e., from 1st April, 2024 onwards.
01.05.2024	GST collection breached landmark milestone of Rs. 2 lakh crore for the first time and  gross revenue recorded a 12.4% y-o-y growth
01.05.2024	Appointment of President for GSTAT - Union Government has appointed President of the new GST Appellate Tribunal (GSTAT) being constituted under the GST law. Justice (Retd) Sanjaya Kumar Mishra, Former Chief Justice of Jharkhand High Court, appointed to the post of President in GSTAT for a period of 4 years w.e.f. dated of assumption of charge of the post or till he attains the age of 70, whatever is earlier. The appointment marks the beginning of operationalisation of GSTAT, a crucial body to resolve GST related disputes and to hear appeals. GSTAT shall consist of Principal bench (to be located at New Delhi) and 31 state benches at various locations across the country.
26.06.2024	CBIC has clarified that in case of supplies received from unregistered suppliers where tax has to be paid by the recipient under reverse charge mechanism (RCM), the relevant financial year for calculation of time limit for availment of ITC under section 16(4) of CGST Act will be the financial year in which the invoice has been issued by the recipient.
26.06.2024	CBIC fixed monetary limits for filing appeals or applications by the Department before GSTAT, High Courts and Supreme Court.
22.07.2024	Finance (No. 2) Bill, 2024 and Union Budget 2024-2025 after general elections announced in Parliament.
26.07.2024	GSTN 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.
16.08.2024	Finance (No.2) Bill, 2024 notified after President’s assent on 16.08.2024. It will be called Finance (No. 2) Act, 2024, Act No. 15 of 2024.
01.10.2024	New Invoice Management System (IMS) introduced
03.10.2024	Supreme Court on ITC on Construction related activities -Commercial building constructed for supplying services such on renting / leasing can be treated as plant and input tax credit under GST allowable subject to passing of functionality test
27.10.2024	The effective date of the amendments made through the Finance (No. 2) Act, 2024 have been notified. [Amendments in Section 16, 109 and 171]
01.11.2024	The effective date of the amendments made through the Finance (No. 2) Act, 2024 have been notified.[ Amendments in Section 114 to 157]
08.11.2024	GSTN issued an advisory for waiver scheme under Section 128A for reducing the tax disputes and to provide a relief to the taxpayers 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.
17.12.2024	CBIC announced following four citizen-centric initiatives to enhance taxpayer's services. These are a testament to CBIC’s unwavering commitment to simplifying tax processes and fostering a culture of transparency and trust. By empowering taxpayers and incorporating their suggestions, CBIC is creating a system that is not only efficient but also reflective of citizens needs and aspirations

 

GST Council meetings in 2024

S.No.	Meeting	Date	Place
	53rd  GST Council Meeting	22.06.2024	New Delhi
	54th GST Council Meeting	09.09.2024	New Delhi
	55th GST Council Meeting	21.12.2024	Jaisalmer, Rajasthan

Notifications and Circulars issued in 2024

Notifications 2024	Number
Central Tax	1 to 31
Central Tax (Rate)	1 to 9
Integrated Tax	1
Integrated Tax (Rate)	1 to 9
Union Territory	1
Union Territory (Rate)	1 to 9
Compensation Cess (Rate)	1
Circulars  2024	207  to 242
Instructions 2024	1 to  4

Table of Month-Wise Gross GST revenue collection at a Glance till date (in Rs. Crores)
Months / Year	FY 2017-18	FY 2018-19	FY2019-20	FY2020-21	FY2021-22	FY2022-23	FY2023-24	FY2024-25
April		1,03,459.00	1,13,865.00	32,172.00	13,708.00	1,67,540.00	1,87,035.00	2,10,000
May		94,016.00	1,00,289.00	62,151.00	97,821.00	1,40,885.00	1,57,090.00	1,73,000
June		95,610.00	99,939.00	90,917.00	92,800.00	1,44,616.00	1,61,497.00	4,90,082
July		96,433.00	1,02,083.00	87,422.00	1,16,393.00	1,48,995.00	1,65,105.00	6,55,966
August	95,633.00	93,960.00	98,202.00	86,449.00	1,12,020.00	1,43,61200	1,59,069.00-	8,06,475
September	94,064.00	94,442.00	91,916.00	95,480.00	1,17,010.00	1,47,686.00	1,62,712.00-	1,73,240
October	93,333.00	1,00,710.00	95,379.00	1,05,155.00	1,30,127.00	1,51,718.00	1,72,003.00-	1,87,346
November	83,780.00	97,637.00	1,03,491.00	1,04,963.00	1,31,526.00	1,45,867.00	1,67,929.00-	1,82,269
December	84,314.00	94,726.00	1,03,184.00	1,15,174.00	1,29,780.00	1,49,507.00	1,64,883.00-	1,76,857
January	89,825.00	1,02,503.00	1,10,818.00	1,19,875.00	1,40,986.00	1,57,554.00	1,72,129.00-
February	85,962.00	97,247.00	1,05,366.00	1,13,143.00	1,33,026.00	1,49,577.00	1,68,337.00-
March	92,167.00	1,06,577.00	97,597.00	1,23,902.00	1,42,095.00	1,60,122.00	1,78,484.00-

Important Supreme Court Judgments in 2024

Supreme Court on ITC on Construction related activities

CHIEF COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX & ORS. VERSUS M/S SAFARI RETREATS PRIVATE LTD. & ORS. - 2024 (10) TMI 286 - SUPREME COURT dated 03.10.2024 as reproduced under:

• Commercial building constructed for supplying services such on renting / leasing can be treated as plant and input tax credit under GST will be allowable.
• Shopping mall is a plant.
• If a property qualifies as a plant, then ITC on goods or services used in its construction can be taken.
• Since plant has not been defined, its ordinary meaning in commercial terms has to be taken into account.
• The functionality test must be applied to assess whether the building is a plant for section 17(5)(d)of CGST Act, 2017.
• Apex Court remanded the matter back to Orissa High Court for factual determination of whether the shopping mall constructed could be classified as plant u/s 17(5)(d) of CGST Act, 2017.
• This may ease the financial burden / cost of rent on lessees / tenants occupying commercial spaces.

Consequences of Canon India case Review by Apex Court

COMMISSIONER OF CUSTOMS VERSUS M/S CANON INDIA PVT. LTD. - 2024 (11) TMI 391 - SUPREME COURT (LB).Apex Court has allowed review of its decision in M/S CANON INDIA PRIVATE LIMITED VERSUS COMMISSIONER OF CUSTOMS - 2021 (3) TMI 384 - SUPREME COURT and has reversed the same. It has held as follows:

• DRI officers appointed as officers of Customs are proper officers for issuing show cause notices u/s 28 of the Customs Act, 1962.
• Section 97 of the Finance Act, 2022 is constitutionally valid. Section 97 which, inter-alia, retrospectively validated all show cause notices issued under Section 28 of the Act, 1962 cannot be said to be unconstitutional.
• Supreme Court in Canon India case based its judgment on two grounds: (1) the show cause notices issued by the DRI officers were invalid for want of jurisdiction; and (2) the show cause notices were issued after the expiry of the prescribed limitation period.
• The officers of Directorate of Revenue Intelligence, Commissionerates of Customs (Preventive), Directorate General of Central Excise Intelligence and Commissionerates of Central Excise and other similarly situated officers are proper officers for the purposes of Section 28 and are competent to issue show cause notice thereunder.
• Any challenge made to the maintainability of such show cause notices issued by this particular class of officers, on the ground of want of jurisdiction for not being the proper officer, which remain pending before various forums, shall now be dealt, as per Supreme Court directions in this judgment.

Cash cannot be seized in search proceedings

COMMISSIONER OF CGST VERSUS DEEPAK KHANDELWAL - 2024 (8) TMI 1041 - SC ORDER. Apex court has held that no case for interference has been made out in exercise of our jurisdiction under Article 136 of the Constitution of India and the SLP was dismissed. It was held as follows:

• The word ‘goods’ as defined under sub-section (52) of Section 2 of the CGST Act, 2017 is in wide terms, but the said term as used in Section 67, is qualified with the condition of being liable for confiscation.
• Thus, only those goods, which are subject matter of or are suspected to be subject matter of evasion of tax. During the course of search under sub-section (2) of Section 67 of the Act, the officer conducting the search may find various types of movable assets.
• Illustratively, in an office premises, one may find furniture, computer, communication instruments, air conditioners etc. Those assets although falling under the definition of ‘goods’ cannot be seized, if the proper officer has no reasons to believe that those goods are liable to be confiscated.
• Cash (Indian currency) is clearly excluded from the definition of the term ‘goods’ as the same falls squarely within the definition of the word ‘money’ as defined in sub-section (75) of Section 2 of the Act.
• The court was of the view that it would not be apposite to construe the word ‘things’ under sub-section (2) of Section 67 of the Act to be mutually exclusive to the term ‘goods’. The term ‘goods’ as used in sub-section (2) of Section 67, essentially, relates to goods, which are subject matter of supplies that are taxable under the Act. Admittedly, the goods that can be seized under sub-section (2) of the Act are goods, which the proper officer believes are liable for confiscation. [Also see: COMMISSIONER OF CGST VERSUS ANSHUL JAIN - 2024 (12) TMI 730 - SC ORDER; COMMISSIONER OF CGST DELHI WEST & ORS. VERSUS GUNJAN BINDAL & ANR. - 2024 (11) TMI 43 - SC ORDER; COMMISSIONER OF CGST & ORS. VERSUS BHAGWAN GUPTA & ORS - 2024 (10) TMI 1049 - SC ORDER].