ECONOMY AND RECENT DEVELOPMENTS IN GST

[Dr. Sanjiv Agarwal]

According to FM, there is a speedy rebound in economic growth on strong economic foundation. The Government’s focus in the recent budget is on good growth, to secure inclusive development to enhance private investment and upheld household sentiments.

Indian economy is on recovery path in H2 of FY 2025 (in contrast to H1) due to enhanced consumption demand, as per Reserve Bank of India. The economy is poised to sustain its position as the fastest growing major economy during FY 2025-26. Strong rural demand is also expected from the robust performance of agricultural sector.

A poll of economists conducted by Economic Times suggests a GDP growth of 6.3% for the Q3 of FY 2025 while Reserve Bank of India has projected a growth of 6.6%. All major projections for FY 2025 are in the range of 6.0% to 6.5%.

India is also working on tariff rationalization, i.e. basic customs duty, safeguard duties or anti-dumping duties to become an investor friendly country. For the last two years, India has been reviewing its trade tariffs.

CBIC has issued clarifications on various issues concerning rates of GST on goods and classification / taxability as an outcome of 55^th GST Council meeting. These are on rates on different popcorn advisories have been issued by GSTN on enrolment of unregistered persons, biometric authentication for registration, e-way bills etc.

It is reported that the GST Council’s Group of Minister on insurance may suggest a GST rate of 6% with input tax credit on term insurance plans.

Various industry bodies have represented to Government on allowing input tax credit on commercial properties meant for leasing. There is a proposal in the Finance Bill, 2025 to restrict or block input tax credit on such supply with retrospective effect from 01.07.2017 which will adversely impact commercial leasing in India.

Implementation dates for amended CGST Rules, 2017 notified

CBIC has notified the dates for enforcement of specific amendments in Rules made earlier vide Notification No. 12/2024-CT dated 10.07.2024.

• The dates of enforcement shall be as follows:

*S. No. / Rule of N.  No. 12/2024-CT	CGST Rules, 2017 / Forms	Pertaining to	Enforcement Date
2	Rule 8 (4A)	Application for registration	11.02.2025
24	Rule 138(3) proviso	E-way Bills	11.02.2025
8	Rule 39 (1)	Prescribing procedure for distribution of ITC by ISD	01.04.2025
27	Form GST ENR-03	Form for Application for Enrolment by unregistered person	11.02.2025
32	Form GSTR-3B	Substitution of Table 6.1 and  for omission of Table 6.2 (for negative liability)	11.02.2025
37	Form GSTR-7	Substitution of table 3 and 4 in Form GSTR-7 (TDS related)	01.04.2025
38	Form GSTR-8	Substitution of table 3 and 4 in Form GSTR-8 (supplies made through e-commerce operator)	01.04.2025

*Notification No. 9/2025-CT refers to rules in Table (2) and such references are Rule Nos. / Para Nos of Notification No. 12/2024-CT, i.e., CGST Amendment Rules, 2024 and not the amended rule.

(Source: Notification No. 09/2025-Central Tax dated 11.02.2025)

CBIC clarifications on levy of GST on goods

• CBIC has issued clarification regarding GST rates & classification (goods) based on the recommendations of the GST Council in its 55th meeting held on 21st December, 2024, at Jaisalmer.
• CBIC has clarified the following issues:

• Clarification on classification and GST rate on pepper of genus Piper
• Clarification regarding raisins supplied by an agriculturist
• Clarification on GST rate on ready to eat popcorn
• Clarification on classification of Fly ash based Autoclaved Aerated Concrete Blocks
• Effective date of amended entry regarding ground clearance for compensation cess

(Source: Circular No. 247/04/2025-GST dated 14.02.2025)

GSTN Advisory for Registration Process

• GSTN has issued a new Advisory on registration process as per amended Rule 8 of CGST Rules, 2017.
• This relates to steps involved for verification for Aadhaar authenticated and non-Aadhaar authenticated cases.
• It has prescribed steps for:

• applicants not opting for Aadhaar authentication
• applicants opting for Aadhaar authentication and application identified for biometric authentication

• Non-generation of Application Reference Number (ARN) will result if discrepancies are not resolved in 15 days or verification is not completed in 15 days.
• For details, readers may refer to Advisory for smooth processing of GST registration application.

(Source: GSTN Advisory dated 12.02.2025)

GSTN advisory on enrolment of unregistered persons

• GSTN has issued an advisory on Introduction of Form ENR-03 for Enrolment of Unregistered Dealers/Persons in e-Way Bill Portal for generating e-way Bill.
• A new feature has been introduced in the E-Way Bill (EWB) system to facilitate the enrolment of unregistered dealers supplying goods, with effect from 11.02.2025.
• Form ENR-03 has been introduced for the enrolment of unregistered dealers.
• Unregistered dealers engaged in the movement or transportation of goods can now generate e-Way Bills by enrolling themselves on the EWB portal and obtaining a unique Enrolment ID. This ID will serve as an alternative to the Supplier GSTIN or Recipient GSTIN for generating e-Way Bills.
• GSTN’s user guide for ENR-03 enrolment covers the following:

• Accessing ENR-03
• Filling Out the ENR-03 Form
• Creating Login Credentials
• Generating an e-Way Bill

• For details, refer to user guide at –

https://tutorial.gst.gov.in/downloads/news/user_manual_for_enr_03_final.pdf

(Source: GSTN Advisory dated 15.02.2025)