CHANGES IN CENTRAL GOODS AND SERVICES TAX RULES, 2017

[Mr. M. GOVINDARAJAN]

Vide Notification dated 15.11.2017 the Central Government made the ‘Central Goods and Services Tax (Twelfth Amendment) Rules, 2017 in exercise of the powers conferred under section 164 of the Central Goods and Services Tax Act, 2017.  The amendment brings facility of filing refund manually whereas in the original act and rules it has been provided for online refund.    This amendment came into effect from 15.11.2017.

Amendment to Rule 43

Rule 43 provides for the manner of determination of input tax credit in respect of capital goods and reversal thereof in certain cases.  Clause 2(i) of the Amendment Rules inserted the explanation after Rule 43(2).  The newly inserted explanation provides that for the purposes of rule 42 and Rule 43, the Central Government clarified that the aggregate value of exempt supplies shall include the value of supply of services specified in the notification No. 42/2017-Integrated Tax (Rate), dated 27.10.2017.

Notification No. 42/2017-Integrated Tax (Rate), dated 27.10.2017 specified the supply of services having place of supply in Nepal or Bhutan, against payment in Indian Rupees are exempted.  The aggregate value shall also include this exemption according to the explanation newly inserted.

Amendment to Rule 54(2)

Rule 54 provides for the issue tax invoices in special cases.  Rule 54 (2) provides that where the supplier of taxable service is an insurer or a bank company or a financial institution, including a non banking financial company the said supplier shall issue a tax invoice or any other document in lieu thereof, by whatever name called, whether issued or made available, physically  or electronically whether or not serially numbered and whether or not containing the address of the recipient of taxable service but containing other information as mentioned under rule 46.

As per existing section 54 (2) the issue of tax invoice is mandatory.  Clause 2(ii) of Amendment rules substituted the word ‘supplier shall issue’ for ‘supplier may issue’.

Amendment to Rule 97

Rule 97 deals  with the Consumer welfare fund.   Clause 2(iii) inserted Rule 97A after Rule 97.  Rule 97A provides for manual filing and processing.  The new Rule 97A provides that notwithstanding anything contained in this Chapter, in respect of any process or procedure prescribed herein, any reference to electronic filing of an application, intimation, reply, declaration, statement or electronic issuance of a notice, order or certificate on the common portal, in respect of that process or procedure, include manual filing of the said application, intimation, reply, declaration, statement or issuance of the said notice, order or certificate in such forms as appended to these rules.

Amendment to Rule 107

Rule 107 provides the procedure for Advance Ruling.  Clause 2(iv) of the Amendment Rules provides for the insertion of new rule 107A after rule 107.  The newly inserted Rule 107A provides that notwithstanding anything contained in this Chapter, in respect of any process or procedure prescribed herein, any reference to electronic filing of an application, intimation, reply, declaration, statement or electronic issuance of a notice, order or certificate on the common portal shall, in respect of that process or procedure include manual filing of the said application, intimation, reply, declaration, statement or issuance of the said notice, order or certificate in such Forms as appended to these rules.

Amendment to Rule 109

Rule 109 provides for the application to be filed to the Appellate Authority.  Clause 2(v) of the Amendment Rules provide for insertion of Rule 109A after Rule 109.  The newly inserted Rule 109A provides for the appointment of Appellate Authority.

Rule 109A(1) provides that any person aggrieved by any decision or order passed under this Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act may appeal to-

• the Commissioner (Appeals) where such decision or order is passed by the Additional or Joint Commissioner;
• the Additional Commissioner (Appeals) where such decision or order is passed by the Deputy or Assistant Commissioner or Superintendent.

The appeal shall be filed within three months from the date on which the said decision or order is communicated to such person.

Rule 109A (2) provides that an officer directed under section 107(2) (appeal by Revenue) to appeal against any decision or order passed under this Act or SGST Act or UTGST Act may appeal to-

• the Commissioner (Appeals) where such decision or order is passed by the Additional or Joint Commissioner;
• the Additional Commissioner (Appeals) where such decision or order is passed by the Deputy or Assistant Commissioner or Superintendent

The appeal should be filed within six months from the date of communication of said decision or order.

Amendment to Rule 124

• Rule 124 deals with the anti profiteering procedure.  The second  proviso to Rule 124 (4) provides that upon the recommendations of the Council and subject to an opportunity of being heard, the Central Government may terminate the appointment of the Chairman at any time.  Clause 2(vi)(a) of the Amendment Rules substituted the above proviso for the new proviso.  The new proviso provides that the Central Government with the approval of the Chairperson of the Council may terminate the appointment of the Chairman at any time.
• The second proviso to Rule 124 (5) provides that Clause 2(vi)(b) of the amendment rules substituted the above proviso for the new proviso.The new proviso provides that the Central Government with the approval of the Chairperson may terminate the appointment of Technical Member at any time.

Application for refund – manual

Clause 2(vii) of the amendment rules inserted after Form GST RFD – 01, the following forms-

• Form GST RFD – 01A – applicable for casual taxable person or non resident taxable person, tax deduction, tax collector and other registered taxable person;
• Form GST RFD – 01B – refund order details.

Form GST RFD – 01A

This form is to be used for the refund under rule 89 and Rule 97A.  The following information is to be furnished by the person who seeks refund by manual filing-

• GSTIN/Temporary ID;
• Legal Name
• Trade Name, if any
• Address
• Tax period
• Amount of refund claimed in respect of central tax, State Tax, Integrated tax, UT tax, cess
• Grounds of refund claim (select from drop down)

• Excess balance in Electronic Cash Ledger;
• Exports of services with payment of tax;
• Exports of goods/services – without payment of tax (accumulated input tax credit);
• ITC accumulated due to inverted tax structure, under clause (ii) of first proviso to section 54(3);
• On account of supplies made to SEZ unit/SEZ developer (without payment of tax)
• Recipient of deemed export.

• Declaration under-

• Second proviso to Section 54(3);
• Section 54(3(ii);
• Rule 89(2)(f)
• Rule 89(2)(l)

• Verification
• Annexure – I

• Statement – 1 (Rule 89(5) – Refund type – ITC accumulated due to inverted tax rate structure[clause (ii) of first proviso to section 54(3)]
• Statement – 3A [rule 89(4)] – Refund type – Export without payment of tax (accumulated ITC) – calculation of refund amount;
• Statement -5A [Rule 89(4)] – Refund type – On account of supplies made to SEZ unit/SEZ developer without payment of tax (accumulated ITC) – calculation of refund amount.

Form GST RFD 01B

• This form is under rule 91(2), 92(1), 92(3), 92(5) and 97A;
• This form contains refund order details;
• The following information is available in this form-

• ARN
• GSTIN/Temporary ID
• Legal Name
• Filing date
• Reason for refund
• Financial year
• Month
• Order No.
• Order issuance date
• Payment advice No.
• Payment advice date
• Refund issued to- Tax payer/Consumer Welfare fund
• Issued by
• Type of order
• Details of refund amount-

• Refund amount claimed
• Refund sanctioned on provisional basis;
• Remaining amount;
• Refund amount inadmissible;
• Gross amount to be paid;
• Interest (if any);
• Amount adjusted against outstanding demand under the existing law or under the act;
• Net Amount to be paid.