Here are some News / Updates / Highlights / Changes in law during the month. Happy Reading !!

Dec 28, 2018

CBIC issues updated 91 FAQs on applicability of GST on financial Services as on December 27, 2018…Read more

New draft policy on e-commerce to fix loopholes, set general rules of biz..Read more

GST evasion worth Rs 38,896 cr detected during April-Oct ..Read more

Dec 22, 2018

31st GST Council Meeting – 7 things to know

In the 31st GST Council meeting, the Council has proposed various relief to the taxpayers, inter-alia, reduction of GST rates on goods and services, extension of due date for filing of Annual return and GST Audit. All such recommendations would be effective after the issuance of necessary notifications in this regard. Key takeaways from 31st GST Council meeting are as follows:

1. New Return Filing System

The CBIC has already issued the draft mechanism for new return filing system. This new return filing system shall be introduced on trial basis from April 1, 2019, which shall be made mandatory from July 1, 2019.

2. Extension of due dates of various returns

a) The GST Council has made the recommendation for extension of due date for filing of GST Annual Return in Form GSTR-9 or GSTR-9A and GST Audit in Form GSTR-9C for financial year 2017-18. The revised due date shall be June 30, 2019.

b) Due date for filing of return in GSTR-8 by e-commerce operators for the months of October, 2018 to December, 2018 shall be extended to January 31, 2019

c) Due date for filing details of goods or capital goods sent to job worker and received back in Form GST ITC-04 extended to March 31, 2019 for the period July, 2017 to December, 2018.

3. Late fee waived-off

The GST Council has made the recommendations for waiver of late fees for all taxpayers in case of GSTR-1, GSTR-3B and GSTR-4 for the months and quarters comprising the months of July, 2017 to September, 2018. However, waiver of late fees would be available only when return is furnished between December 22, 2018 and March 31, 2019. If any late fees is paid by the taxpayers for late filing of return, he shall not be eligible to get the waiver of such fees by way of credit in the electronic credit ledger.

4. GST Refund

Now, there is no need to physically visit a tax office for submission of a refund application. GST Council approves of the online facility which would enable the taxpayer to upload all the required documents on GST portal to claim refund of tax.

5. Creation of Centralized AAAR

At present, there is no provision of Centralized Appellate Authority for Advance Ruling (AAAR). The GST Council has recommended the creation of Centralized AAAR to deal with the conflicting decisions made by two or more State AAAR on the same issue.

6. Reduction in GST rates of goods

a) Rates reduced from 28% to 18% on certain electronic goods, inter-alia, monitors, television (upto 32 inches), digital cameras, video cameras, video games, pulleys, transmission shafts, cranks, gear boxes, etc.

b) Rates reduced from28% to 5% for parts and accessories for carriage fordisabled person.

c) Rates reduced from18% to 12% for certain goods, i.e., cork roughly squared or debagged, articles of natural, cork agglomerate cork, etc.

d) Rates reduced from18% to 5% for marble ruble

e) Rates reduced from12% to 5% fornatural cork, walking sticks, fly ash blocks, etc.

f) Renewal energy devices and parts thereof tobe taxed at 5%

g) Certain goods exempted from tax, i.e., goods supplied by nominated agencies to exporters of gold Jewellery, proceeds received by government from auction of gifts, etc.

h) Rates reduced to nil for certain goods, i.e., music books, vegetables (cooked,uncooked or frozen), preserved vegetables, etc.

7. Reduction in GST rates of services

a) GST rates on cinema tickets has been reduced from 28% to 12% for tickets price up to Rs. 100.

b) GST rates on cinema tickets has been reduced from 28% to 18% for tickets price morethan Rs. 100.

c) Third party insurance premium of motor vehicle shall be chargeable to GST at 12% instead of 18%.

d) Certain services shall be exempt from tax, i.e., services by bank to Jan Dhan account holders, services by GTAs to government dept., services by Govt. to their undertakings or PSUs by way of guaranteeing loans taken by financial institutions, etc.

Recommendations made during 31stMeeting of the GST Council……..Read more

Decisions taken by the GST Council in the 31st meeting held on 22ndDecember 2018 regarding GST rate on services………Read More

Recommendations made during 31st Meeting of the GST Council held on 22nd December, 2018…..…Read More

Dec 19, 2018

No penalty can be levied for minor errors in e-Way bill when taxes have been paid correctly, rules Kerala HC

In what could be seen as a big relief for businesses, a High Court ruling has made it clear that no penalty can be levied if wrong value of goods are entered in e-Way bills, provided the amount paid as tax is correct. Since the High Court order has precedent value, it means such a ruling can be applied for any matter where goods are detained on account of small mistake in e-Way bill — like a zero missing from the value of goods even when tax has been paid correctly. The matter here involves the consignment, along with the vehicle, detained because of a mistake in the value of goods even though taxes were paid on the correct account. The petitioner, Greater Noida-based Rai Prexim India Private Ltd, moved the Kerala High Court seeking relief as it’s goods were detained on account of discrepancy in the e-Way bill. read more…

December 18, 2018

GSTN has started sharing data with tax authorities on the following:
a.Mis-match between figures reported in GSTR-1 & GSTR-3B.
b.Mis-match between figures reported GSTR-3B &that computed by the system in GSTR-2A.
c.Taxpayers who have generated e-way bill but not filed tax returns

Dec 17, 2018

Services by Indian subsidiary co. to foreign parent co. liable to GST as Indian Co. acts as an intermediary (AAR – MAHARASHTRA)

CGST : Where applicant is acting as a broker/agent, etc. and facilitating process for sale of CRS Software belonging to their foreign parent company to Indian subscribers which are identified by applicant and do not come on their own to applicant, applicant actually acts as an Intermediary between potential subscriber and its foreign parent company to provide software belonging to parent company and, thus, marketing, promotion and distribution services provided by applicant, i.e., Sabre India to foreign parent, i.e., Sabre APAC would be subject to tax under Central Goods and Services Tax Act, 2017 and Maharashtra Goods and Services Tax Act, 2017 and would not be treated as export of service in accordance to section 2(6) of Integrated Goods and Services Tax Act, 2017

No GST on reimbursement of salary on behalf of foreign entity: AAR Maharashtra

GST : Applicant, a Crew Recruitment and Placement Agency, is involved in selecting and recruiting shipping personnel on behalf of their principal/client (RMS) who is a Foreign Ship Owner and for which they are charging Administration fees and paying GST on such Administration charges so received – Applicant has submitted that their principal has requested them for disbursal of salary to crew members from applicant’s side, for which principal would be transferring sum of total salary to applicant who in turn will be disbursing salary to crew member through banking channels into their respective accounts, and claimed amount so remitted towards disbursal of salary would not be taxable under GST in view of provisions of Rule 33 of CGST Rules, 2017

• The AAR held that applicant will be acting as a pure agent of RMS in as much as entire amount received by them as Crews’ salary will be disbursed to Crew and no amounts from said receipt will be used by applicant for his own interest – In fact, for performing as a pure agent they will also be receiving compensation separately in form of fixed fees to be charged as service charges – In view of above, applicant will not be liable to pay GST on salary amount received from RMS and disbursed to crew.

December 15, 2018

Person who maintained website was liable to GST on commission from website users or Pundits (AAR – MAHARASHTRA)

CGST : As per section 15 (1) the value of supply of services shall be the transaction value, which is the price actually paid or payable for the said supply of goods or services or both where the supplier and the recipient of the supply are not related and the price is the sole consideration for the supply. Applicant is engaged into the business of assisting believers, followers and devotees to book pundits/Brahmins online for their religious ceremonies like pujas, abhisheks etc. The said service is being provided through applicant’s own website. Applicant and recipient are not related persons and price received is sole consideration. These services are given by the applicant in his business models to choose the type of model. In all the three business models consideration is first received by him on online as a whole and thereafter major part of it, is given to Pundits who are having an agreement with the applicant to provide their services as and when it is requisitioned but they are not the applicant’s employees but are providing their services independently. The actual basic services like puja, abhishek etc. are performed by the pundits or Brahmins which are exempted by nature of notification issued under GST ACT. The commission portion is received by the applicant out of total consideration received online from the service recipient. As per the provisions of law, the commission is the supply of service and it would be the value on which he would be liable for GST and, thus, the Applicant would be liable to pay GST on the value of commission received from website users not for on total amount received

Dec 13,2018

  • More GST rate cuts expected in upcoming GST council meeting for item in 28% slab ….Read more

Dec 12, 2018

  • Companies vanishing act on GST invites taxman……Read more

Dec 07,2018

  • Due date of GST Annual Return and GST Audit Return i. e Form GSTR-9 , GSTR- 9A & GSTR- 9C extended to 31st March, 2019

Dec 06, 2018

  • No denial of exemption in absence of proof that asseessee introduced unaccounted money to earn LTCG IT : Assessing Officer received information from DGIT (Inv.), Kolkata that some companies were engaged in business of issuing penny stocks for which there were large number of beneficiaries claiming bogus long term capital gain – Assessing Officer, based on said information, found that assessee is one of beneficiaries of said racket and, thus long term capital gain from sale of shares of a company (Rutron) declared by assessee and claimed as exempt income under section 10(38) was treated by Assessing Officer as bogus and added said amount to total income of assessee under section 68
  • • The Tribunal noted that assessee had produced relevant record to show allotment of shares by company on payment of consideration by cheque, all entries are part of bank account of assessee and assessee dematerialized shares in D-mat account.

    • The Tribunal held that Assessing Officer has not brought any material on record to show that assessee has paid over and above purchase consideration as claimed and evident from bank account and, thus, in absence of any evidence, it cannot be held that assessee has introduced his own unaccounted money by way of bogus long term capital gain.

  • ITR forms will soon be pre-filled for you: CBDT’s Sushil Chandra

    The process of filing tax returns will soon become a lot easier, with the tax department planning to introduce pre-filled fields based on information already available with it, cutting out the tediousness of this annual chore.Data available from entities that deduct tax at source such as employers and banks would be used to offer pre-filled tax return forms to people, Sushil Chandra, chairman of Central Board of Direct Taxes (CBDT), said, adding that work on this project was on. A pre-filled return could be submitted directly or after modification, he said.The new form is aimed at encouraging people, who are daunted by the complexity of the process, to file their taxes. It’s also part of the department’s efforts to present a taxpayer-friendly interface and give officials fewer discretionary powers.

Dec 06, 2018

  • Taxman starts questioning & issuing notices to BPOs

    One month after the Authority of Advance Ruling (AAR) ruled that back office support services qualify as “intermediary” support services and not exports, officers of the indirect tax department have started issuing preliminary notices to captive units of multinationals and Indian companies exporting offshore support services.AAR’s directive meant several back offices of multinationals and Indian companies providing offshore support services to foreign companies now face 18% GST liability. The AAR held that some services provided by BPO may qualify as intermediary service and therefore, may not qualify as export service

Dec 04, 2018

Dec 03, 2018

  • Converting company to LLP is a transfer, hence taxable, rules I-T Appellate Tribunal

    A new tax ruling threatens to challenge a strategy that allowed thousands of businesses and professionals to reorganise themselves and attract foreign investors. This involved converting closely held companies into limited liability partnerships (LLPs) — a structure that was introduced a decade ago. While LLP was intended to help businesses to scale up, many were also allured by its ability to freely distribute profits to partners as dividend without deducting any dividend distribution tax.

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