The CBIC vide Notification No. 38/2023-Central Tax dated 04.08.2023, has amended the Central Goods and Services Tax Rules, 2017. These rules may be called as Central Goods and Service Tax (Second Amendment) Rules, 2023. These changes are made to give effect to the recommendation in respect to measures for streamlining the compliances under GST as discussed by the GST Council in its 50th GST Council meeting held on 11th July, 2023.
The changes made are as under:
1. Verification of the application and approval (Rule 9): To remove the requirement of physical verification of business premises in the presence of the applicant.
2. Furnishing of Bank Account Details (Rule 10A) : To require the registered person to furnish bank account details, including the name and PAN within 30 days of grant of registration or before filing of statement of outwards supply under section 37 of CGST Act in FORM GSTR-1/ IFF, whichever is earlier.
3. Suspension of registration (Rule 21A):
System-based suspension of GST registration: where the registered person fails to provide valid bank account no. within time prescribed under Rule 10A i.e. 30 days of grant of registration or before filing the statement of outwards supply under section 37 of the CGST, Act, 2017 in Form GSTR-1/ IFF, whichever is earlier. In such cases, registration would be suspended and the person would not be allowed to file Form GSTR-1.
However, the automatic revocation of the system-based suspension of registration would be allowed upon compliance with the provisions of Rule 10A i.e. furnishing the banks account details.
4. Revocation of cancellation of registration (Rule 23), to be effective w.e.f. 01.10.2023
To extend the time limit for submitting application for revocation of cancellation of registration from 30 days to 90 days, from the date of the service of the order of cancellation of registration. Also, the period of 90 days could be extended by the Commissioner on sufficient cause being shown for further period not exceeding 90 days.
5. Physical verification of business premises in certain cases (Rule 25): To provide that the physical verification may still be conducted even if Aadhaar authentication has been completed in high risk cases. Also, Physical verification of business premises can be done in absence of the registered person.
6. Manner of determination of input tax credit in respect of capital goods and reversal thereof in certain cases (Rule 43):
- To provide that aggregate value of exempt supply for the purpose of Rule 42 and Rule 43 of the CGST Rules, 2017, it shall include the value of supply of services by way of transportation of goods by a vessel from the customs station of clearance in India to a place outside India.
- Sale of warehoused goods before filing Bill of Entry is now liable for reversal of ITC under Rule 42: For such pursposes, the value of such activities/transactions shall be the value of supply of goods from Duty Free Shops at arrival terminal in international airports to the incoming passengers. (applicable w.e.f. 01.10.2023)
7. Tax Invoice (Rule 46):
To provide that only name of the state of recipient required to be mention on the tax invoice, and not the name and full address of recipient in cases of supply of taxable services by or through an e-commerce operator or by OIDAR to unregistered recipient.
8. Form and manner of furnishing details of outward supplies (Rule 59):
a) To impose restriction on the registered persons to furnish details of outward supplies in FORM GSTR-1 or through the Invoice Furnishing Facility (IFF), where failure to provide valid bank account no. under Rule 10A.
b) Also, restriction is imposed on the registered person by not allowing to furnish details in FORM GSTR-1 for subsequent tax period, to whom a System based intimation has been issued under newly inserted Rule 88D of the CGST Rules, 2017, in respect of the excess availment of ITC in FORM GSTR-3B as compared to that available in FORM GSTR-2B.
In such cases, the registered person shall be allowed to furnish the details of outward supplies of goods or services or both upon payment of amount equal to the excess ITC as specified in the said intimation or on furnishing of a reply explaining the reasons in respect of the amount of excess ITC remaining unpaid.
9. Form and manner of submission of return by persons providing OIDAR services (Rule 64) w.e.f. 01.10.2023: To make mandatory for the OIDAR service providers to provide details of supplies made to registered individuals in India in their return filed in FORM GSTR-5A.
10. Form and manner of submission of statement of supplies through an e-commerce operator (Rule 67) w.e.f. 01.10.2023: To provide that the details of TCS as collected by the e-commerce operator shall be made available electronically to each of the registered suppliers.
11. Mechanism to deal ITC differences between GSTR-2B and GSTR-3B (New inserted Rule 88D): A new rule has been inserted to provide that manner for dealing with difference in input tax credit available in auto-generated statement containing the details of input tax credit and that availed in return. This aims to reduce the ITC mismatches and misuse of ITC facility in GST.
Under this the taxpayer will get System based intimation in PART A of FORM GST DRC-01C, in respect of the excess availment of ITC in FORM GSTR-3B as compared to that available in FORM GSTR-2B. The intimation would direct such taxpayer to exercise either of the below option within 7 days
a) pay an amount equal to the excess input tax credit availed in the said FORM GSTR-3B, along with interest payable under section 50, through FORM GST DRC-03 or
b) provide the reason for such discrepancies.
12. Refund:
a) Rule 89: To provide that the refund of any amount after adjusting the tax payable by the applicant shall be claimed only after the last return required to be furnished by him has been so furnished.
b) Rule 94 (w.e.f. 01.10.2023): To provide that the period of delay for payment of interest on refunds u/s 56 of the CGST Act, 2017 shall not include following:
(a) any period of time beyond 15 days of receipt of notice in FORM GST RFD-08, that the applicant takes to- (i) furnish a reply in FORM GST RFD-09, or
(ii) submit additional documents or reply;
and
(b) any period of time taken either by the applicant for furnishing the correct details of the bank account to which the refund is to be credited or for validating the details of the bank account so furnished, where the amount of refund sanctioned could not be credited to the bank account furnished by the applicant
13. Appeal/ Application to the Appellate Authority (Rule 108 and Rule 109): To allow manual filing of Appeal or Application under certain specified circumstances.
Appeal or Application to be filed manually in FORM GST APL-01/ FORM GST APL-03, with relevant documents only if
a) Notified by the Commissioner or
b) Where the Appeal cannot be filed electronically due to non-availability of the decision or order to be appealed against on the common portal.
14. Requirement for generating E-way bill for intra-state movement of gold, precious stones (Newly Inserted Rule 138F):
A new rule has been inserted to mandate the requirement of generating E-way bill for movement of Gold/ Precious stones covered under Chapter 71 of the First Schedule to the Customs Tariff Act, 1975.
15. Manner of recovery of tax and interest under Rule 88(c) of the CGST Rules, 2017 (Newly inserted Rule 142B):
Earlier, Rule 88C was inserted in respect to system generated intimation to taxpayers in cases where output tax liability under GSTR-1 is in excess to what disclosed in FORM GSTR-3B.
Now, Rule 142B has been inserted to provide the manner of recovery of the tax and interest in respect of the amount intimated under rule 88C of the CGST Rules which has not been paid and for which no satisfactory explanation has been furnished by the registered person.
16. Compounding of Offences (Rule 162) w.e.f. 01.10.2023:
A new sub-rule (3A) has been inserted u/r 162 to specify the compounding amount for various offences under section 132 of CGST Act, 2017 to align with the changes made through the Finance Act, 2023.
17. Consent based sharing of information furnished by taxable person (newly inserted Rule 163) w.e.f. 01.10.2023:
A new Rule has been inserted to provide the conditions and manner in which the information or details of the taxable persons shall be shared on the GST portal with the other systems u/s 158 A i.e. the requesting system.
18. Amendment in FORM GSTR-3A: To issue notice to the registered taxpayers for their failure to furnish Annual Return in FORM GSTR-9 or FORM GSTR-9A by due date.
19. Amendment in FORM GSTR-5A (w.e.f. 01.10.2023): To allow the OIDAR service providers to provide details of supplies made to registered individuals in India in their return filed in FORM GSTR-5A.
20. Amendment in FORM GSTR-8 (w.e.f. 01.10.2023): In order to align with the recent changes made vide Notification No. 37/2023-Central Tax dated 04.08.2023, to allow unregistered suppliers to make the intra-state supply of goods through e-commerce operators. To furnish the details made through e-commerce operator by un-registered suppliers.
21. Amendment in FORM GSTR-9 and GSTR-9C: To provide relaxation provided in F.Y. 2021-22 in respect of various tables of FORM GSTR-9 and FORM GSTR-9C to be continued for F.Y. 2022-23.
22. New FORM GST DRC-01C has been introduced: To provide System generated Intimation of difference in input tax credit available in auto-generated statement containing the details of input tax credit and that availed in return.
23. New FORM GST DRC-01D has been introduced: To provide intimation for amount recoverable under section 79.
The Notification can be accessed at https://taxo.online/wp-content/uploads/2023/08/gst-ct-38-2023.pdf
