Ranjan Mehta

(Chartered Accountant)

2021
March Volume -03
 Editor's Desk
Happy New Financial Year !!!

May the new Financial year bring abundance of finance

in your life. However, with the finance the mental peace and
work life balance is a must. This GST regime at one point has
provided ample opportunities to us Chartered Accountants
but at the same time have increased the compliance burden
multifold. This pandemic season has even added to the injury
without giving any opportunity to relax and rejuvenate. Since
the time the lockdown is lifted we are engaged in the
compliances one after another. First we were involved in the
CA RANJAN MEHTA return filing for the months' due date of which were falling
within lockdown i.e. February to June 2020. Then once this compliance was over we were
engaged in GST Annual Return and Audit for FY 2018-19 also at the same time we were busy
with Income tax compliances including Tax Audit and ITRs continuously bragging for
extension. By 31st of December although free from GST Audit 2018-19, still submerged in
income tax returns and Audit, we again engaged in GST Audit for FY 2019-20.

In between other different compliance changes such as QRMP, GSTR-2B, E-invoicing

continued to crept in. This whole compliance maze never allowed us to sit and reflect on the
various issues in the law and other things. A lot of changes have occurred vide Budget 2021
which are going to change the course of this regime.

Sec 7 (1)(aa) has been introduced w.e.f. 01.07.2017 to nullify the effects of the judgment
of Hon'ble SC in the matter of M/s Calcultta Club Ltd. Also Sec 16(2)(aa) has been inserted to
allow the Input Tax Credit only when the supplier fills the Invoice details in GSTR-1. The biggest
blow has been given to the Exporters taking back the benefit of refund under IGST exports and
leaving them with only LUT method. However, these changes are yet to be notified so
implementation of them will take time.

Urgently, the implementation of 2 important changes are required:-

a)For those assessees whose aggregate turnover have been exceeded Rs. 50 crores in any of
the Financial Years starting from 2017-18 are required to generate E-invoices w.e.f.
01.04.2021.

b)For all assessees having aggregate turnover more than Rs. 5 crores are now required to
provide 6 digits HSN Codes in their Invoices.

However, still amidst all of this we as a human being should have a break and enjoy the life
as it is. So enjoy a Holiday.
CA Ranjan Mehta

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 GST related Budget Changes at a Glance

Changes in CGST Act, 2017

GST imposed on clubs and associations – Principal of Mutuality denied

I.Section 7 (1) of CGST Act, 2017 classified supply in (a) to (d) clauses. Now a new
addition to the definition is made with retrospective effects from 1st July, 2017,
“(aa) the activities or transactions, by a person, other than an individual, to its members or
constituents or vice versa, for cash, deferred payment or other valuable consideration.

Explanation : For the purposes of this clause, it is hereby clarified that, notwithstanding anything
contained in any other law for the time being in force or any judgment, decree or order of any
Court, tribunal or authority, the person and its members or constituents shall be deemed to be
two separate persons and the supply of 77 activities or transactions inter se shall be deemed to
take place from one such person to another;”

From this it can be understood that any person, other than individual, if enters into any
transaction or activity with its members or constituents, for consideration, shall be termed as
supply as per the amendment to Section 7(1) of CGST Act, 2017 with effect from 1stJuly, 2017.

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 GST related Budget Changes at a Glance

ITC entitlement only if details furnished by supplier in GSTR-1

II. The next insertion was

made in Section 16 (2), which
contains the requirements to
be fulfilled by the registered
person to claim Input Tax
Credit.

“(aa) the details of the invoice

or debit note referred to in
clause (a) has been furnished
by the supplier in the statement of outward supplies and such details have been communicated
to the recipient of such invoice or debit note in the manner specified under section 37;”.

Earlier the registered person was required to have possession of the tax invoice and debit
note issued by the supplier registered under this act, or other such tax paying document as may
be prescribed, but now with the insertion of above mentioned clause with Finance Act, 2021, the
registered person will be entitled for the ITC when the details of the invoice or debit note
mentioned in Section 16(2)(a), has been furnished by the supplier in GSTR-1 submitted and
details of the invoice or debit note is communicated to the recipient in manner specified in
section 37.

Omission of Audit of Annual Accounts under sub section 5 of section 35

III. Sub-section 5 of section 35 which required that

every registered person whose turnover during a financial
year exceeds the prescribed limit shall get his accounts
audited by Chartered Accountant or Cost Accountant
and shall submit a copy of audited annual accounts, the
reconciliation statement under sub-section (2) of section
44 has been omitted from the Act.

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 GST related Budget Changes at a Glance

Miscellaneous Changes in CGST Act, 2017

IV. For section 44 of the CGST Act, the following section is

substituted, namely:-

“ Every registered person, other than an Input Service Distributor, a

person paying tax under section 51 or section 52, a casual taxable
person and a non-resident taxable person shall furnish an annual
return which may include a self certified reconciliation statement,
reconciling the value of supplies declared in the return furnished for the financial year, with the
audited annual financial statement for every financial year electronically, within such time and in
such form and in such manner as may be prescribed:

Provided that the Commissioner may, on the recommendations of the Council, by

notification, exempt any class of registered persons from filing annual return under this section:

Provided further that nothing contained in this section shall apply to any department of
the Central Government or a State Government or a local authority, whose books of account are
subject to audit by the Comptroller and Auditor General of India or an auditor appointed for
auditing the accounts of local authorities under any law for the time being in force.”.

Earlier it was required that assessee shall furnish an annual return for every financial year
electronically in such form and manner as may be prescribed on or before the thirty-first day of
December following the end of such financial year.

V. In section 50 of the CGST Act, in sub-section (1), for the proviso, the following proviso is
substituted retrospectively with effect from the 1st day of July, 2017, namely:––

“Provided that the interest on tax payable in respect of supplies made during a tax period
and declared in the return for the said period furnished after the due date in accordance with the
provisions of section 39, except where such return is furnished after commencement of any
proceedings under section 73 or section 74 in respect of the said period, shall be payable on that
portion of the tax which is paid by debiting the electronic cash ledger.”.

Prior to this substitution the interest on tax payable, was required to be levied on that

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 GST related Budget Changes at a Glance

portion of the tax which is paid by debiting the electronic cash ledger.

VI. Amendment in Section 74 : In section 74 of the CGST Act, 2017, Determination of tax not paid
or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of
fraud or any willful misstatement or suppression of facts, in Explanation 1, in clause (ii), for the
words and figures “sections 122, 125, 129 and 130”, the words and figures “sections 122 and
125” shall be substituted.

VII. Amendment in Section 75 : In section 75 of the CGST Act, General provision relating to
determination of tax, in sub-section (12), the following Explanation is inserted, namely:––

'Explanation.––For the purposes of this sub-section, the expression "self-assessed tax" shall
include the tax payable in respect of details of outward supplies furnished under section 37, but
not included in the return furnished under section 39.'.

VIII. Amendment in Section 83 : In section 83 of the CGST Act, Provisional attachment to protect
revenue in certain cases, sub-section (1), the following sub-section is substituted, namely:––

“(1) Where, after the initiation of any proceeding under Chapter XII, Chapter XIV or Chapter XV,
the Commissioner is of the opinion that for the purpose of protecting the interest of the
Government revenue it is necessary so to do, he may, by order in writing, attach provisionally, any
property, including bank account, belonging to the taxable person or any person specified in
sub-section (1A) of section 122, in such manner as may be prescribed.”.

Previously the Commissioner was authorized to attach provisionally, any property,

including bank account, belonging to the taxable person if he is of the opinion that for the
purpose of protecting the interest of the Government revenue it is necessary so to do, in case of
any proceedings under Section 62 or Section 63, or Section 64, or Section 67 or Section. 73 or
Section 74.

With the amendment in Section 83 the scope of its applicability has been enlarged by
substituting the sections with Chapter XII (covering sections related to Assessment), Chapter
XIV (covering sections related to Inspection, Search, Seizure and Arrest) or Chapter XV
(covering sections related to Demands and Recovery) and addition of “any person specified in
sub-section (1A) of section 122” whereas earlier it was limited to the belongings of taxable

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 GST related Budget Changes at a Glance

person.

IX. Amendment in Section 107 : In section 107, Appeals to Appellate Authority of the CGST Act,
in sub-section (6), the following proviso is inserted, namely:––

“Provided that no appeal shall be filed against an order under sub-section (3) of section
129, unless a sum equal to twenty-five per cent. of the penalty has been paid by the appellant.”.

Section 129 consists of provisions related to detention, seizure and release of goods and
conveyances in transit.

X. Amendment in Section 129 : In section 129 of the CGST Act, ––

(i) in sub-section (1), for clauses (a) and (b), the following clauses are substituted, namely:––

“(a) on payment of penalty equal to two hundred per cent. of the tax payable on such goods and,
in case of exempted goods, on payment of an amount equal to two per cent. of the value of
goods or twenty-five thousand rupees, whichever is less, where the owner of the goods comes
forward for payment of such penalty;

(b) on payment of penalty equal to fifty per cent. of the value of the goods or two hundred per
cent. of the tax payable on such goods, whichever is higher, and in case of exempted goods, on
payment of an amount equal to five per cent. of the value of goods or twenty-five thousand
rupees, whichever is less, where the owner of the goods does not come forward for payment of
such penalty;”;

Prior to the amendment, clause (a) stated “on payment of the applicable tax and penalty
equal to one hundred per cent. of the tax payable on such goods” where now words “applicable
tax” has been removed and “one hundred per cent.” is replaced with “two hundred per cent.”

Clause (b) consisted the following provision “on payment of the applicable tax and penalty
equal to fifty per cent. of the value of the goods reduced by the tax amount paid thereon” where
words “applicable tax” has been removed and “reduced by the tax amount paid thereon” has
been substituted by “or two hundred per cent. of the tax payable on such goods, whichever is
higher” with the amendment.

(ii) sub-section (2) is omitted;

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 GST related Budget Changes at a Glance

(iii) for sub-section (3), the following sub-section is substituted, namely:––

“(3) The proper officer detaining or seizing goods or conveyance shall issue a notice within
seven days of such detention or seizure, specifying the penalty payable, and thereafter, pass an
order within a period of seven days from the date of service of such notice, for payment of
penalty under clause (a) or clause (b) of sub-section (1).”;

Previously, the time limit of issuing the notice and passing the order was not specified in
the sub section. Further there was requirement to “specifying the tax and penalty payable” in the
notice and order by the proper officer which now has been substituted by the “penalty” only.

(iv) in sub-section (4), for the words “No tax, interest or penalty”, the words “No penalty” is
substituted;

(v) for sub-section (6), the following sub-section shall be substituted, namely:––

“(6) Where the person transporting any goods or the owner of such goods fails to pay the
amount of penalty under sub-section (1) within fifteen days from the date of receipt of the copy
of the order passed under sub-section (3), the goods or conveyance so detained or seized shall
be liable to be sold or disposed of otherwise, in such manner and within such time as may be
prescribed, to recover the penalty payable under sub-section (3)

Provided that the conveyance shall be released on payment by the transporter of penalty
under sub-section (3) or one lakh rupees, whichever is less.

Provided further that where the detained or seized goods are perishable or hazardous in
nature or are likely to depreciate in value with passage of time, the said period of fifteen days
may be reduced by the proper officer.”..

Earlier, the provision had “amount of tax and penalty as provided in sub-section (1)” which
now has been substituted by “amount of penalty under sub-section (1)”.

It also specified that liability shall be paid by the said person “within fourteen days of such
detention or seizure, further proceedings shall be initiated in accordance with the provisions of
sec 130”. This now has been substituted by “within fifteen days from the date of receipt of the
copy of the order passed under sub-section (3), the goods or conveyance so detained or seized

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 GST related Budget Changes at a Glance

shall be liable to be sold or disposed of otherwise, in such manner and within such time as may
be prescribed, to recover the penalty payable under sub-section (3)”.

The first proviso is a new insertion in which penalty has been specified for release of
conveyance so detained or seized, whereas the second proviso has been amended where the
words “fourteen days” are substituted by “fifteen days”

XI. Amendment in Section 130 :In section 130 of the CGST Act,––

(a) in sub-section (1), for the words “Notwithstanding anythingcontained in this Act, if ”, the word
“Where” is substituted;

(b) in sub-section (2), in the second proviso, for the words, brackets and figures “amount of
penalty leviable under sub-section (1) of section 129”, the words “penalty equal to hundred per
cent. of the tax payable on such goods” is substituted;

(c) sub-section (3) is omitted.

XII. Substitution of new section for section 151 :For section 151 of the CGST Act, the following
section shall be substituted, namely: –– Power to call for information.

“151. The Commissioner or an officer authorised by him may, by an order, direct any
person to furnish information relating to any matter dealt with in connection with this Act, within
such time, in such form, and in such manner, as may be specified therein.”.

Prior to substitution Section 151 was for “Power to collect statistics” which required that
the Commissioner, if considers necessary so to do, by notification direct that statics may be
collected relating to any matter dealt with by or in connection with this Act.

XIII. Amendment in Section 152: In section 152 of the CGST Act,––

(a) in sub-section (1),––

(i) the words “of any individual return or part thereof” are omitted;

(ii) after the words “any proceedings under this Act”, the words “without giving an opportunity of
being heard to the person concerned” is inserted;

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 GST related Budget Changes at a Glance

(b) Sub-section (2) is omitted.

XIV. Amendment in Section 168 : In section 168 of the CGST Act, in sub-section (2),––

(i) for the words, brackets and figures “sub-section (1) of section 44”, the word and figures
“section 44” is substituted;

(ii) the words, brackets and figures “sub-section (1) of section 151,” is omitted.

XV. Amendment in Schedule II : In Schedule II of the CGST Act, paragraph 7 shall be omitted and
shall be deemed to have been omitted with effect from the 1st day of July, 2017.

The omitted paragraph classified the specified supplies in the paragraph, as supply of
goods which now has been omitted.

Changes in IGST Act, 2017

Amendment in section 16 Benefit of refund under IGST payment method denied

In the IGST Act, 2017, in section 16, ––

(a) in sub-section (1), in clause (b), after the words “supply of goods or services or both”, the
words “for authorised operations” is inserted;

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 GST related Budget Changes at a Glance

Earlier it was, “supply of goods or services or both to a Special Economic Zone developer or a
Special economic Zone Unit”.

(b) for sub-section (3), the following sub-sections shall be substituted, namely:––

“(3) A registered person making zero rated supply shall be eligible to claim refund of unutilised
input tax credit on supply of goods or services or both, without payment of integrated tax, under
bond or Letter of Undertaking, in accordance with the provisions of section 54 of the CGST Act
or the rules made thereunder, subject to such conditions, safeguards and procedure as may be
prescribed:

Provided that the registered person making zero rated supply of goods shall, in case of
non-realisation of sale proceeds, be liable to deposit the refund so received under this sub-
section along with the applicable interest under section 50 of the CGST Act within thirty days
after the expiry of the time limit prescribed under the Foreign Exchange Management Act, 1999
for receipt of foreign exchange remittances, in such manner as may be prescribed.

Previously there were Two clauses of sub-section 3 of section 16 , (a) and (b) which
provided when a registered person, in case of zero rated supply, is eligible to claim refund of
unutilized credit, on payment or without payment of integrated tax.

Further, in amendment a proviso is inserted where the procedure to be followed by a

registered person in case of non-realisation of sale proceeds, is provided where he shall be
liable to deposit the refund so received under this sub-section along with the applicable interest
under section 50 of the CGST Act within thirty days after the expiry of the time limit prescribed
under FEMA,1999.

(4) The Government may, on the recommendation of the Council, and subject to such
conditions, safeguards and procedures, by notification, specify––

(i) a class of persons who may make zero rated supply on payment of integrated tax and claim
refund of the tax so paid;

(ii) a class of goods or services which may be exported on payment of integrated tax and the
supplier of such goods or services may claim the refund of tax so paid.”.

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 GST related Budget Changes at a Glance

Sub- Section 4 of Section 16 of IGST Act, 2017 is a new insertion in the said section. This new
addition provides that the Government on Council's recommendation, may specify, by
notification, a class of persons who can make zero rated supply on payment of integrated tax
and claim its refund and also a class of goods and services which may be exported with
payment pf integrated tax and the refund of the same can be claimed by the supplier of such
specified goods.

The following amendments are to be complied w.e.f 1St April,2021 by

persons registered under GST Act.

QR Code in B2C Supply : Notification No. 14/2020– Central Tax New Delhi, the 21st March,
2020

A registered person, whose aggregate turnover in a financial year exceeds five hundred crore
rupees, making B2C sales i.e. sales to unregistered person shall have Dynamic Quick Response
(QR) code The said procedure previously was liable to be complied from 1st April 2021.Now the
date of compliance has been substituted by 1st July 2021 vide Notification No. 06/2021 –
Central Tax New Delhi, the 30th March, 2021.

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 GST related Budget Changes at a Glance

E-invoicing mandatory w.e.f 1st April 2021(Turnover>50Crore)

Notification No. 13/2020– Central Tax New Delhi, the 21st March, 2020 as amended
by Notification No. 05/2021 – Central Tax New Delhi, the 8th March, 2021

The notification hereby notifies registered person whose aggregate turnover in a financial
year starting from 2017-18 exceeded fifty crore rupees, is required to generate E-invoice w.e.f
1st April 2021.

As per Rule 48(4) of CGST Rules, notified class of registered persons have to prepare
invoice by uploading specified particulars of invoice (in FORM GST INV-01) on Invoice
Registration Portal (IRP) and obtain an Invoice Reference Number (IRN).

HSN Code in Tax Invoice : Notification No. 78/2020 – Central Tax New Delhi, the 15th
October, 2020

With effect from the 01st day of April, 2021, a registered person having aggregate turnover up to
five crores rupees in the previous financial year should mention 4 Number of Digits of
Harmonised System of Nomenclature Code (HSN Code) in a tax invoice issued by him and in
case the turnover is more than rupees five crores then 6 digits of HSN Code are required to be
mentioned in the tax invoice issued by him.

E-Way bill Limit : Notification No. F.17 (131)ACCT/GST/2017/3743, dated 6th

August, 2018 has been amended vide Notification no. F.17 (131-Pt-II)ACCT/GST/2017/6672.
Where movement of goods commences and terminates within the State of Rajasthan (intra-
state supply) the value of goods not exceeding Rs. 1,00,000/- has been exempted for generation
of E-Way w.e.f 1st April ,2021.

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 GST Returns
Due Dates

GST Forms Particulars Due Dates

GSTR- Details of outwards supplies of taxable goods/or 11thApril, 2021

1(Mar2021) services affected

GSTR-1(Jan - Details of outwards supplies of taxable goods/or 13 th April, 2021

Mar 2021) services affected
IFF (Mar21) Invoice Furnishing Facility under QRMP Scheme 13th April 2021

GSTR-3B Summary of outward supplies with ITC is declared and 20thApril,2021

(Mar 2021) payment of tax is affected by taxpayer (Turnover>Rs 5 cr)
GSTR-3B Opted for QRMP 24thApril, 2021
( Jan - Mar 2021)

GST -5 (Mar Return for Non-Resident foreign taxable person 20thApril, 2021
2021)
GSTR-6 Return for an Input Service Distributor (ISD) 13thApril, 2021
(Mar 2021)
GSTR-7 Return for authorities deducting tax at source 10thApril,2021
(Mar 2021) (TDS)
Filed by E-commerce operators liable to deduct 10thApril, 2021
GSTR- 8 TCS

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 Contact Us

This publication contains information for general guidance only. It is not intended to address the
circumstances of any particular individual or entity. Although the best of Endeavour has been
made to provide the provisions in a simpler and accurate form, there is no substitute to detailed
research with regard to the specific situation of a particular individual or entity. We do not accept
any responsibility for loss incurred by any person for acting or refraining to act as a result of any
matter in this publication. This is a private circulation for clients and professionals only.

Source: Notifications and circular issued by CBIC.

CONTACT US

Email us with any questions or query or call 9460382075,

-Team, Do You Know GST

– CA RANJAN MEHTA –
Email: doyouknowgst@gmail.com
office@rmaconsultancy.in
Mobile No: +91-9460382075

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