37th GST Council Meeting – Key Highlights

1. Policy Changes

New Return Filing System

New Return filing to be now introduced from April 2020 (Earlier proposed from Oct, 19)

New return system now to be introduced from April, 2020 (earlier proposed from October, 2019), in order to give ample opportunity to taxpayers as well as the system to adapt and accordingly specifying the due date for furnishing of return in FORM GSTR-3B and details of outward supplies in FORM GSTR-1 for the period October, 2019 -March, 2020.

Annual Returns and GST Audits

1) Gst Annual Return GSTR-9 and 9A  Optional for those with turnover upto 2 Cr for FY 17-18 & 18-19.

2) GSTR-9 is mandatory for those turnover is above 2 Cr.

3) No relief in case of GSTR-9C – GST Audit Form.

4) GSTR-9 & 9C to be made “Saral”.

Circulars (Old/New) to be issued on following matters

1) Refund RFD – 01A,       

2) Supply of ITeS

3) Rescinding circulars wrt Post-Sales Discounts

Issuance of circulars for uniformity in application of law across all jurisdictions:

a. procedure to claim refund in FORM GST RFD-01A subsequent to favourable order in appeal or any other forum;

b. eligibility to file a refund application in FORM GST RFD-01A for a period and category under which a NIL refund application has already been filed; and

c. clarification regarding supply of Information Technology enabled Services (ITeS services) (in supersession of Circular No. 107/26/2019-GST dated 18.07.2019) being made on own account or as intermediary.

2. Reduction in Rates and Rationalisation of various measures

Hospitality and Tourism Industry:

1) Tariffs 7500 & above – GST 18%,

2) Tariffs between 1,000-7500 – GST 12%,

3) Tariffs below 1000 – Nil,

4) Outside Catering – GST 5% without ITC (Reduce from 18%),

Job Work Sector

1) Diamond Job work – GST 1.5% (Reduce From 5% ),

2) Other Job-work – GST 12% (Reduce from 18%).

Warehousing

Exempted Storage & warehousing services wrt certain agricultural products 

Transportation

Export freight exemption further extended till 30th September, 2020

Insurance Sector

Exemption given to BSB Crop insurance of WB state & Life insurance services by Central Armed Paramilitary Forces 

Export Promotion

1) Exemption given to intermediary services where both supplier and recipient is outside India,

2) Place of supply for specified R&D Services and supply of chip design R&D Services shall be th to the location of service recipient

New Law for 2 union territory

Suitable amendments in CGST Act, UTGST Act, and the corresponding SGST Acts in view of creation of UTs of Jammu & Kashmir and Ladakh.

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Last date to file GST annual returns extended till Nov 30

New Delhi, Aug 26 The finance ministry on Monday said the last date for filing annual GST returns has been extended by three months to November 30 as taxpayers were facing technical problems in furnishing returns.

Earlier, GST taxpayers were to file required returns by August 31.

"It is hereby informed that the last date for furnishing of annual return in the Form GSTR-9 / Form GSTR-9A and reconciliation statement in the Form GSTR-9C for the financial year 2017-18 is extended from August 31, 2019 to November 30, 2019," the Central Board of Indirect Taxes & Customs (CBIC) said in a statement.

GSTR 9 is an annual return to be filed yearly by taxpayers registered under the Goods and Services Tax (GST). It consists of details regarding the outward and inward supplies made or received under different tax heads.

While extending the date, the CBIC said "certain technical problems are being faced" by the taxpayers as a result annual return for the period July 1, 2017 to March 31, 2018 could not be furnished by persons registered under GST.

GSTR-9C is filed by those whose annual turnover exceeds Rs 2 crore. It is a statement of reconciliation between GSTR-9 and the audited annual financial statement, while GSTR-9A is the annual return to be filed those who have opted for the Composition Scheme under GST.

What is the consequence of non-filing the return? 
Failure to file annual return shall attract a late fee of INR 200 per day during the period of failure, subject to a maximum of 0.25% of the said Financial Year's turnover. 

Whether the annual return can be revised 

As there is no specific provision in GST law to revise the annual return hence, based upon the current version of the law, it appears that once filed the same cannot be revised. 

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Analysis of clarifications on filing of Annual Return (FORM GSTR-9)

The due date for filing of Form GSTR 9 is 30th June 2019. Mean while the government has issued certain clarifications vide press release dated 03.06.2019.  The press release is like an “oxymoron” where some clarifications adding to the confusion. However it may be noted that press release is not any legal document. Given below is a brief comment on the various clarifications issued.

S.No.	Clarification	Comment
a	Information contained in FORM GSTR-2A as on 01.05.2019 shall be auto-populated in Table 8A of FORM GSTR-9.	The GSTR 2A downloaded from the portal is not matching with the auto-populated in Table 8A. This has been a concern in many of the cases, making businesses ponder upon what the programming of the GSTIN portal is. Now it is clarified that the data as reflecting as on 01.05.2019 shall be auto populated. It would have been better if the data is updated and auto-populated on real time basis. Given that only 25 days are left for the due date, it is an issue to be addressed at the earliest.
b	Input tax credit on inward supplies shall be declared from April 2018 to March 2019 in Table 8C of FORM GSTR-9.	The last date for availing input tax credit is September of the following year or filing of annual return whichever is earlier.  This time limit was extended to March 2019 by issue of Removal of difficulty order. However the heading of Table 8C  is “ITC of F.Y. 17-18 but availed in April 18 to Sep 18. Therefore clarification is issued that, in Table 8C, details from April 18 to Mar 19 is to be given. However no notification is issued.
c	Particulars of the transactions for FY 2017-18 declared in returns between April 2018 to March 2019 shall be declared in Pt. V of FORM GSTR-9. Such particulars may contain details of amendments furnished in Table 10 and Table 11 of FORM GSTR-1.	The last date for making any corrections or amendments in the GST returns is September of the following year or filing of annual return whichever is earlier.  This time limit was extended to March 2019 by issue of Removal of difficulty order. However the Part V still required details of April 18 to Sep 18. Therefore clarification is issued that, in Part V details from April 18 to March 19 is to be given. However no notification is issued.
d	It may be noted that irrespective of when the supply was declared in FORM GSTR-1, the principle of declaring a supply in Pt. II or Pt. V is essentially driven by when was tax paid through FORM GSTR-3B in respect of such supplies. If the tax on such supply was paid through FORM GSTR-3B between July 2017 to March 2018 then such supply shall be declared in Pt. II and if the tax was paid through FORM GSTR- 3B between April 2018 to March 2019 then such supply shall be declared in Pt. V of FORM GSTR-9.	In case of mismatch in GSTR 3B and GSTR 1, GSTR 3B shall prevail. Supplies declared in July to March 18 in GSTR 3B shall be declared in Part II and Supplies declared in April 18 to March 19 in GSTR 3B shall be declared in Part V.
e	Any additional outward supply which was not declared by the registered person in FORM GSTR-1 and FORM GSTR-3B shall be declared in Pt.II of the FORM GSTR-9. Such additional liability shall be computed in Pt.IV and the gap between the “tax payable” and “Paid through cash” column of FORM GSTR-9 shall be paid through FORM DRC-03.	Outward supplies not declared in GSTR 3B and GSTR1 shall also be declared in Part II. The additional liability now payable shall also be declared in part IV. And paid through DRC 03
f	Many taxpayers have reported a mismatch between auto-populated data and the actual entry in their books of accounts or returns. One common challenge reported by  taxpayer is in Table 4 of FORM GSTR-9 where details may have been missed in FORM GSTR-1 but tax was already paid in FORM GSTR-3B and therefore  taxpayers see a mismatch between auto-populated data and data in FORM GSTR-3B. It may be noted that auto-population is a functionality provided to taxpayers for facilitation purposes, taxpayers shall report the data as per their books of account or returns filed during the financial year.	As per the instructions to Form GSTR 9, only as Table Entry 6A and Table Entry 8A shall be auto-populated. However in the portal in GSTR 9 many entries are being auto-populated. It says, in Form GSTR 9, “taxpayers shall report the data as per their books of account or returns filed during the financial year.” So again, with this clarification, they have confused whether to fill GSTR 9 as per books of accounts or Returns.
g	Many taxpayers have represented that Table 8 has no row to fill in credit of IGST paid at the time of import of goods but availed in the return of April 2018 to March 2019. Due to this, there are apprehensions that credit which was availed between April 2018 to March 2019 but not reported in the annual return may lapse. For this particular entry, taxpayers are advised to fill in their entire credit availed on import of goods from July 2017 to March 2019 in Table 6(E) of FORM GSTR-9 itself.	IN table 8 there was no entry fto show IGST on goods imported in F.Y. 17-18 but ITC in F.Y. 18-19. It is clarified that said details is to be mentioned in Table Entry No 6E. This may give difference, at Entry No 6J and also it will add un reconciled item for Form GSTR 9C. There was a mistake in the drafting of the form and through this clarification, there is a trail to cover the error. However the clarification will lead to mismatch at Entry No. 6J as provided above.
h	Payments made through FORM DRC-03 for any supplies relating to period between July 2017 to March 2018 will not be accounted for in FORM GSTR-9 but shall be reported during reconciliation in FORM GSTR-9C.	As per Para (e) the additional liability can be paid in Form GSTR 9. However in this para it is said that the additional liability shall not be reported in GSTR C7 but shall be reported  as reconciliation item in GSTR 9C. This is again a confusing clarification.
i	All the taxpayers are requested to file their Annual Return (FORM GSTR-9) at the earliest to avoid last minute rush.	The due date was already extended twice, there does not seem to be any further extension in spite of the various confusions in the form

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