The CBIC by issuing Notification No. 28/2023-Central Tax dated 31.07.2023, has appointed the date for applicability of the provisions of the Finance Act, 2023 in relation to Goods and Services Tax Act in the following manner:
- w.e.f. 01st October, 2023: Date on which provisions of Section 137 to 162 (except Section 149 to 154) shall be applicable
- w.e.f. 01st August, 2023: Date on which provisions of Section 149 to 154 shall be applicable.
The gist of changes are discussed as under:
A. Changes which are made applicable w.e.f. 01.08.2023
Provisions relating to GST Appellate Tribunal (GSTAT)
a) Section 109: Constitution of Appellate Tribunal and Benches thereof
b) Amendment in Section 110: Appointment, qualifications, conditions of service, etc of President and Members of Appellate Tribunal.
c) Amendment in Section 114: Financial and Administrative powers of President of GSTAT
d) Amendment in Section 117: Appeal to High Court
e) Amendment in Section 118: Appeal to Supreme Court
f) Amendment in Section 119: Sums due to be paid notwithstanding appeal, etc.
B. Changes which are made applicable w.e.f. 01.10.2023
1. Composition levy (Section 10): Benefit of composition scheme which was earlier not available to registered persons engaged in supplying goods through E-commerce operator shall be extended to them.
The restriction of opting composition scheme to pay GST no longer applies to supplier of goods through E-commerce operators. However, restriction will continue to apply for such registered persons who are engaged in supply of services through E-commerce operator.
2. Input Tax credit:
a) Amendment in condition to make payment in 180 days (Section 16): To align the language of law with the return filing system, it is provided that where a recipient fails to pay to the supplier the amount towards the value of supply along with tax, within a period of 180 days from the date of issue of invoice, an amount equal to the ITC availed by the recipient, shall be paid by the recipient along with interest payable under Section 50 of the CGST Act.
Further, the recipient would be entitled to re-avail the ITC on payment made by him to the supplier of the amount towards the value of supply of goods or services or both along with tax payable thereon.
b) Sale of warehoused goods before filing Bill of Entry is now liable for reversal of ITC under Rule 42: Availment of ITC restricted in respect of certain transactions specified in para 8(a) of Schedule III of the CGST Act i.e., “Supply of warehoused goods to any person before clearance for home consumption”, by including the value of such transactions in the value of exempt supply.
c) No ITC on CSR expenditure: ITC not be available on good/services received by taxable person, which are used or intended to be used for activities relating to his obligations under Corporate Social Responsibility (“CSR”) activities.
3. Registration:
a) Section 23: Retrospective amendment from 01.07.2017, to provide that the person need not required to take registration under Section 22 and Section 24 of the CGST Act, 2017, if they are not liable for registration and/or exempted under Section 23(1) of the CGST Act.
b) Section 30: Time limit of 30 days withdrawn for moving application for Revocation of Cancellation of GST Registration
4. Returns:
Last day to file return in FORM GSTR-1, GSTR-3B, Annual return in FORM GSTR-9, 9C and TCS return in FORM GSTR-8: The registered person can furnish the return in GSTR-1, GSTR-3B, GSTR-9, GSTR-9C and GSTR-8 within a maximum time limit of 3 years from the due date of furnishing the relevant return.
5. Refund:
a) Section 54: Amendment made merely to align the same with present scheme of availment of ITC on self-assessment basis.
b) Section 56: Interest on delayed refunds will be granted subject to certain conditions & restrictions and in the manner which will be prescribed.
6. Assessment of unregistered person: Period to furnish Form GSTR 3B or Form GSTR 10 (Final Return) increased from 30 days to 60 days under Best Judgment Assessment.
7. Penalty for certain offences:
a) Insertion of Sub-section (1B) under section 122: To provide penal provisions applicable to ECO in case of contravention of provisions relating to supplies of goods made through them by unregistered persons or composition taxpayers.
8. Punishment of certain offences (Section 132):
a) Decriminalization of certain offences: Decriminalize the offences specified under clause (g), (j) and (k) from Section 132(1) of the CGST Act, 2017
b) Amendment in monetary limit for initiating prosecution proceedings: The Monetary threshold amended from Rs. 1 Crore to Rs.2 Crore for launching prosecution, except for cases those involving fake/bogus invoices. Thus, in case of offences, other than fake invoices, imprisonment can be initiated if value is more than Rs. 2 crores and for fake invoices, the prosecution will continue as for threshold amount of Rs. 1 Crore.
9. Compounding of offences (Section 138):
a) No Compounding of offences: Fake/bogus invoice cases to be excluded from the option of compounding of offences.
b) Reduction in Compounding fees: Reduction of amount for compounding of various offences except offence of fake invoice, by reducing the minimum and maximum amount for compounding.
| Earlier | Now | |
| Minimum | Higher of Rs. 10,000 or 50% of tax involved | 25% of tax involved |
| Maximum | Higher of Rs. 30,000 or 150% of tax involved | 100% of tax involved |
10. Consent based sharing of information furnished by taxable person: Insertion of Section 158A for allowing sharing of information or details furnished by a taxable person on the GST common portal with such other systems as may be notified by government.
11. Retrospective applicability of Para 7, 8(a) and 8(c) of Schedule III to CGST Act, 2017: Supplies of goods from a place outside the taxable territory to another place outside the taxable territory, high sea sales and supply of warehoused goods before their home clearance were inserted in Schedule III of the CGST Act vide CGST Amendment Act,2018 dated 01.02.2019. Now, these supplies are proposed to be non-taxable with retrospective effect from 01 July 2017 to put an end on ongoing litigations or prospective litigations in cases wherein no tax is paid by any taxpayer on such supplies.
However, no refund of such tax paid shall be available in cases where any tax has already been paid in respect of such transactions/ activities during the period July 01, 2017 to January 31, 2019.
12. Scope of OIDAR services widened: Definition of OIDAR amended to widened the scope of services, by removing the condition of “essentially automated” and “involving minimal human intervention”.
Also, the condition of receipt of OIDAR services for purposes other than commerce, industry or any other business or profession, the supplier of OIDAR services located in a non-taxable territory shall be the person liable for paying integrated tax even if such services are received for the purposes of commerce, industry, business or profession.
13. Place of Supply:
a) Place of supply of transportation of goods, including mail or courier (Section 12 of IGST Act): To specify the place of supply, irrespective of destination of the goods, place of supply shall fall in India in cases where the supplier of services and recipient of services are located in India.
b) Place of supply of transportation of goods, other than by mail or courier (Section 13 of IGST Act): Omitted Section 13(9) of the IGST Act, 2017, to provide that place of supply of services in case of transportation of goods, other than by way of mail or courier would be covered under default provision of Section 13(2) of IGST Act and would be the location of the recipient of services.
The Notification can be accessed at https://taxo.online/wp-content/uploads/2023/08/gst-ct-28-2023.pdf
