Advisory on launch of E-Way Bill 2 Portal

 Advisory on launch of E-Way Bill 2 Portal

GSTN is pleased to inform that NIC is releasing the E-Way Bill 2 Portal (https://ewaybill2.gst.gov.in) on 1st June 2024. This portal ensures high availability and runs in parallel to the e-way Bill main portal (https://ewaybillgst.gov.in). The e-way bill 2 portal synchronizes the e-way bill details with main portal within a few seconds. The highlights of the portal are as follows:

@. Presently, E-Way Bill 2 portal provides the critical services of E-Way Bill system, and gradually it will be extended with other services of e-way bill system.

@. E-Way Bills can be generated and updated on the E-Way Bill 2 portal independently.

@. E-Way Bill 2 portal provides the web and API modes of operations for e-way bill services.

@. The taxpayers and logistic operators can use the E-Way Bill 2 portal with the login credentials of the main portal.

@.  The taxpayers and logistic operators can use the E- Way Bill 2 portal during technical glitches in e-way bill main portal or any other exigencies.

@.  The Criss - Cross operations of printing and updating of Part B of E-Way Bills can be carried out on these portals. That is, updating of part-B of the E-Way bills of portal 1 can be done at portal 2 and vice versa.

@.  In case E-Way Bill main portal is non-operational because of technical reasons, the part-B can be updated to the E-Way Bills, generated at portal 1 at portal 2 and carry both the E-Way Bill slips.

Important Update: Enhancement in the GST Portal

 Important Update: Enhancement in the GST Portal

Apr 26th, 2024

Dear Taxpayers,

1.  GSTN is pleased to inform that an enhanced version of the GST portal would be launched on 3rd May 2024. The effort is to improve user experience and ensure that the information you need is accessible and easy to navigate.

2.  Key Enhancements Include (PDF with screenshots attached) https://www.profitablecpmrate.com/qe303jt1xm?
:

i.     News and Updates Section: We have introduced a dedicated tab for all news and updates. This section now includes a beta search functionality, module wise drop downs and access to archived advisories dating back to 2017.

ii.     User Interface Improvements: Minor tweaks have been made to the homepage to enhance usability and aesthetics especially to make it convenient to use.

iii.    Updated Website Policy: We have updated our website policy, including the data archival policy. Details regarding web managers have also been included.

3.  These changes are scheduled to go live at midnight on 3rd May 2024. Attached to this advisory is a screenshot showcasing some of the upcoming modifications. GSTN will continue to keep you informed as and when these changes are implemented.

4.  Thank you for your ongoing support and cooperation.

   

Advisory on launch of E-Way Bill 2 Portal

Advisory on launch of E-Way Bill 2 Portal

May 28th, 2024

GSTN is pleased to inform that NIC is releasing the E-Way Bill 2 Portal (https://ewaybill2.gst.gov.in) on 1st June 2024. This portal ensures high availability and runs in parallel to the e-way Bill main portal (https://ewaybillgst.gov.in). The e-way bill 2 portal synchronizes the e-way bill details with main portal within a few seconds. The highlights of the portal are as follows:

•   Presently, E-Way Bill 2 Portal provides the critical services of E-Way Bill system, and gradually it will be extended with other services of e-way bill system.

•   E-Way Bills can be generated and updated on the E-Way Bill 2 Portal independently.

•   E-Way Bill 2 portal provides the web and API modes of operations for e-way bill services.

•   The taxpayers and logistic operators can use the E-Way Bill 2 portal with the login credentials of the main portal.

•   The taxpayers and logistic operators can use the E-Way Bill 2 portal during technical glitches in e-way bill main portal or any other exigencies.

•   The Criss-Cross operations of printing and updating of Part-B of E-Way Bills can be carried out on these portals. That is, updating of Part-B of the E-Way bills of portal 1 can be done at portal 2 and vice versa.

•   In case E-Way Bill main portal is non-operational because of technical reasons, the Part-B can be updated to the E-Way Bills, generated at Portal 1, at portal 2 and carry both the E-way Bill slips.

•   For further details, please visit the e-way bill portals.

TAX BULLETIN

 TAX BULLETIN - ANNIVERSARY EDITION - THE INSTITUTE OF COST ACCOUNTANTS OF INDIA 1 ASSESSMENT AND AUDIT UNDER GST CMA Bibhu Datta Sarangi DGM (F&A). MEGPTCL action 2(11) of the CGST Act 2017 defined the assessment as the determination of tax liability under this act and includes self-assessment, reassessment provisional assessment, summary assessment and best judgement assessment. On a broader sense, ‘’assessment is all about the estimation of tax liability of a registered person i.e. amount of tax payable on value of goods or services or both supplied by him. Self-Assessment under of the CGST Act/SGST Act 2017: Section of the 59 of the acts every registered person shall self-assess the tax payable on supplied made during tax period and file the return of each tax period as per section 39 of the CGST Act. Provisional Assessment under of the CGST Act/SGST Act 2017: Section 60 of the Act enumerates that the provisional assessment is carried out in case where a taxable person is unable to determine his value of supply or rate of taxes applicable there to the Proper officer may within 90 days from the receipt of application along with required document issue an order specifying the rate and value which tax has to pay on provisional basis. In terms of the section 60(2) a registered person are bound to execute the bond and furnish surety or security in the form of Bank Guarantee which shall not exceeding 25% of the amount covered under the bond. The proper officer shall determine the tax liability on provisional basis within six months from the date of communication of the provisional assessment order after taking into consideration such information as may be required for finalizing the assessment. Joint or additional commissioner may record in writing the reason to extend the date of final assessment order to further six months maximum. The commission may extend the date for further period of 4 years. Thus, a Provisional assessment can remain provisional for a period of maximum of 5 years. The registered Person shall be liable to pay interest on so much of the amount of tax payable on provisional basis which remains unpaid on the date of payment of taxes under section 60(4) of the act. A registered person shall be entitled for refund if the amount of taxes paid on provisional basis exceeds the actual liability determined on finalization of assessment. Scrutiny of returns: Once the registered person furnishes the return the proper officer may scrutinize the returns and related particulars to verity its correctness. If there is any discrepancy, between the returns and available information, the same discrepancies will be communicated to the registered person for giving explanation on it. In terms of the section 60(3),if the registered person fails to furnish any satisfactory explanation to the proper officer within 30 days from the date of communication of discrepancies, then the appropriate action will be taken against the registered person as per Section 65, 66, 67 and determine the dues or penalty if any as per Section 65, 66, 67 and determine the dues or penalty if any as per Section 73, 74. Assessment of Non-Filers of Returns: As per Section 62 of the act empowers the proper officer to make best judgement assessment If the registered person fails to furnish the return under Section 39 or final return under section 45 even after submission of notice under Section 46. If the registered person fails to file the returns as per the defined sections and rules or where a taxable person fails to obtain the registration or Whose registration is cancelled and they are liable to tax, then the proper officer assess the tax liability to the best of his judgment and issues the order of best judgment assessment within a period of 5 years from the date of Annual Return of the financial year to which tax not paid relates. The registered person will be given 15 days’ time for submission of their reply after issue of best judgement notice. Assessment of Unregistered Person: As per Section 63 , a taxable person is liable to be registered in accordance with the provision of the Section 22 of Section 24 but fails to obtain registration or whose registration has been cancelled on account of circumstances mentioned in Section 29(2) but who was liable to pay tax , the assessing officer may assess the tax liability to the best of his judgement for the relevant tax period and issue assessment order within five years from the date of furnishing annual return i.e. 31st December following the financial year to which the tax paid relates. Assessment in Special Cases under GST (Section 64): As per Section 64 (1), If the proper officer is having such evidence which proves that there is some discrepancies in the tax liability, then he may with the previous permission of the Joint Commissioner or Addl. Commissioner assess the tax liability in the interest of the revenue. Further, If the taxable person to whom the tax liability is imposed is not ascertainable, then the person in charge shall be liable to pay the assessed tax or any other dues. Audit by Tax Authorities under GST (Section 65): The GST regime continues to promote the scheme of self-assessment like erstwhile indirect tax laws and Audit of S TAX BULLETIN - ANNIVERSARY EDITION - THE INSTITUTE OF COST ACCOUNTANTS OF INDIA 2 records of taxpayers is the basis for the proper functioning of self-assessment-based tax system. As per section 2(13) of CGST Act, 2017. GST Audit means examination of records, returns and documents maintained and furnished by registered person to check the following: - a) Verify the correctness of turnover declared. b) Input tax credit availed and utilized. c) Exemptions and deductions claimed. d) Rate of tax applied in respect of supply of goods or services etc. The following three types of GST audit are envisaged under the GST Law: -

1. GST Audit u/s 35(5) of Act, if turnover exceeds prescribed limit (i.e Rs. 2 Crore) 2. GST Audit by tax authority's u/s 65. 3. Special GST audit direction from department u/s 66. 1. GST Audit u/s 35(5) Every registered person, whose turnover during the financial year exceeds the prescribed “GST audit turnover limit” i.e., 2 crore rupees, shall get the accounts audited by a Chartered Accountant (CA) or a Cost and Management Accountant (CMA). Registered person who is required to get his accounts audited in accordance with section 35(5) shall submit electronically the Annual Return as per section 44 along with a copy of the audited statement of accounts and a reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year. He shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in Form GSTR-9C along with annual return. Here the term used is aggregate turnover and not turnover in state. Aggregate turnover is computed on all India basis having same PAN. Therefore, if a registered person is liable to gets his accounts audited under section 35, then all the registration obtained under same PAN will also be liable to GST audit. 2. GST Audit by tax authorities u/s 65. The Commissioner or any officer authorised by him, may undertake audit of any registered person for such period, at such frequency and in such manner as may be prescribed in a general or a specific order (Section 65 of CGST Act). The officers may conduct audit at the place of business of the registered person or in their office. The registered person shall be informed by way of a notice of not less than fifteen working days before the conduct of audit in Form GST ADT-01. As per Section 65(4) , audit of registered person shall be completed within three months from the date of commencement of audit. Further , if the Commissioner is satisfied that audit of the registered person can’t be completed within three months , he may extend the time period for a further period not exceeding six months after recording the reasons for doing so in writing. The proper officer will inform the final findings of his audit to the registered person in form ADT-02.The finding under GST audit may be used by proper officer to initiate action u/s 73 or 74. 3. Special GST audit direction from department u/s 66 During if at any stage of scrutiny, inquiry, investigation or any other proceedings, any officer not below the rank of Assistant Commissioner, is of the opinion that  the value has not been correctly declared or  the credit availed is not within the normal limits, The Assessing Authority may, with the prior approval of the Commissioner, direct such registered person to get his records including books of account examined and audited by a Chartered Accountant or a cost accountant as may be nominated by the Commissioner. The officer will issue direction in Form GST ADT-03 to the registered person in this regard. The Chartered Accountant or Cost Accountant so nominated shall submit a report of such audit duly signed and certified by him to the said Assistant Commissioner, within the period of ninety days, which can be further extended by ninety days. As per Section 66(3) of the act the special Audit may be directed even if accounts and record of the registered persons are audited under any other law in force such such as The Company Act 2013 on the Income Tax Act 1961. The registered person shall be given an opportunity of being heard where any material gathered on the basis of special audit under this act is proposed to be used against him in any proceeding under the act. All expenses spent in connection with Special Audit including remuneration of Auditors to be determined and paid by commissioner as per Section 66(5) of the Act. All registered person shall be informed about the audit finding in Form GST ADT-04 after the audit is concluded. As per Section 66(6) of the Act, if any discrepancy in terms of tax not paid, tax short paid or input tax credit wrongly availed, the officer, may proceed to initiate action under section 73 and 74 of the act

GST

 GST is a unified tax system that replaced multiple indirect taxes levied by both the Central and State Governments. Under GST, both the Central and State Governments share the authority to levy and collect taxes on goods and services

Genesis

The idea of a nationwide GST in India was first proposed by the Kelkar Task Force on Indirect taxes in 2000. The objective was to replace the prevailing complex and fragmented tax structure with a unified system that would simplify compliance, reduce tax cascading, and promote economic integration. The Empowered Committee of State Finance Ministers prepared a design and roadmap, releasing the First Discussion Paper in 2009. The Constitution Amendment Bill was introduced in 2011 but faced challenges regarding compensation to States and other issues.

After years of deliberation and negotiations between the Central and State Governments, the Constitution (122nd Amendment) Bill, 2014, was introduced in the Parliament. The Bill aimed to amend the Constitution to enable the implementation of GST. The Constitution Amendment Bill was passed by the Lok Sabha in May, 2015. The Bill with certain amendments was finally passed in the Rajya Sabha and thereafter by the Lok Sabha in August, 2016. Further, the Bill has been ratified by the required number of States and has since received the assent of the President on 8th September, 2016 and has been enacted as the 101st Constitution Amendment Act, 2016. The GST Council was notified w.e.f. 12th September, 2016. For assisting the GST Council, the office of the GST Council Secretariat was also established.

The GST Council, consisting of the Union Finance Minister and representatives from all States and Union Territories, was established to make decisions on various aspects of GST, including tax rates, exemptions, and administrative procedures. It played a crucial role in shaping the GST framework in India. On July 1, 2017, GST laws were implemented, replacing a complex web of Central and State taxes. Under the Indian GST, goods and services are categorized into different tax slabs, including 5%, 12%, 18%, and 28%. Some essential commodities are exempted from GST, Gold and job work for diamond attract low rate of taxation. Compensation cess is being levied on demerit goods and ceratin luxury items .

To prepare for the implementation of GST, extensive efforts were made to build the necessary technological infrastructure and train tax officials and businesses. GST Network (GSTN), a not-for-profit company, was created to provide the IT backbone for the GST system, including taxpayer registration, return filing, and tax payments.

Since its implementation, the Indian GST has undergone various amendments and refinements based on feedback from businesses and the evolving economic scenario. While the GST implementation initially posed challenges for businesses in terms of understanding the new compliance requirements and adapting to the changes, it has gradually settled into the Indian tax landscape.

It can be said that the history of GST in India showcases a monumental shift in the country's tax structure, aiming to create a more unified, efficient, and transparent indirect tax regime for the benefit of businesses and the economy as a whole.

 

GST and Centre-State Financial Relations

The implementation of GST has brought about a fundamental shift in the financial relations between the Central Government and the State Governments in India. GST is a unified tax system that replaced multiple indirect taxes levied by both the Central and State Governments. Under GST, both the Central and State Governments share the authority to levy and collect taxes on goods and services. This has led to greater harmonization and uniformity in the tax structure across States, promoting economic integration.

The GST system follows a dual structure, comprising Central GST (CGST) and State GST (SGST), levied concurrently by the Central and State governments, respectively. Additionally, an Integrated GST (IGST) is levied on interstate supplies and imports, which is collected by the Central Government but apportioned to the destination state.

In terms of revenue distribution, the GST Council plays a crucial role. It is a joint forum consisting of the Union Finance Minister and representatives from all States and Union Territories. The Council makes decisions on various aspects of GST, including tax rates, exemptions, and revenue sharing between the Central and State Governments. Except for one decision, all decisions of the Council were taken by consensus.

To ensure a smooth transition to the GST regime and address any revenue losses incurred by the States, a compensation mechanism was established. The Central Government was committed to providing compensation to the States for any revenue shortfall during the initial years of GST implementation. This compensation was meant to bridge the gap between the expected revenue growth and the actual revenue collected by the States.

 It has fostered greater coordination, reduced tax barriers, and streamlined the tax system, leading to improved efficiency and competitiveness in the Indian economy. The successful implementation of GST relies on a cooperative and consensus-based approach between the Central and State Governments. It has transformed financial relations, ensuring greater coordination and efficiency in the Indian tax system.

Salient Features of GST

Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and services in India. Here are some of the salient features of GST:

a.       One Nation, One Tax: GST replaced multiple indirect taxes levied by the Central and State Governments, such as excise duty, service tax, value-added tax (VAT), and others. It brought uniformity in the tax structure across India, eliminating the cascading effect of taxes.

b.       Dual Structure: GST operates under a dual structure, comprising the Central GST (CGST) levied by the Central Government and the State GST (SGST) levied by the State Governments. In the case of Inter-state transactions, Integrated GST (IGST) is applicable, which is collected by the Central Government and apportioned to the respective State. Import of goods or services would be treated as inter-state supplies and would be subject to IGST in addition to the applicable customs duties.

c.        Destination-based Tax: GST is a destination-based tax, levied at each stage of the supply chain, from the manufacturer to the consumer. It is applied to the value addition at each stage, allowing for the seamless flow of credits and reducing the tax burden on the end consumer.

d.       Input Tax Credit (ITC): GST allows for the utilization of input tax credit, wherein businesses can claim credit for the tax paid on inputs used in the production or provision of goods and services. This helps avoid double taxation and reduces the overall tax liability.

e.        GST would apply on all goods and services except Alcohol for human consumption. GST on five specified petroleum products (Crude, Petrol, Diesel, ATF & Natural Gas) would by applicable from a date to be recommended by the GSTC. Tobacco and tobacco products would be subject to GST. In addition, the Centre would have the power to levy Central Excise duty on these products. Exports are zero-rated supplies. Thus, goods or services that are exported would not suffer input taxes or taxes on finished products.

f.        Threshold Exemption: Small businesses with a turnover below a specified threshold (currently, the threshold is 20 lakhs for supplier of services/both goods & services and 40 lakhs for supplier of goods (Intra–Sate) in India) are exempt from GST. For some special category states, the threshold varies between 10-20 lakhs for suppliers of goods and/or services except for Jammu & Kashmir, Himachal Pradesh and Assam where the threshold is 20 lakhs for supplier of services/both goods & services and 40 lakhs for supplier of goods (Intra–Sate). This threshold helps in reducing the compliance burden on small-scale businesses.

g.        Composition Scheme: The composition scheme is available for small taxpayers with a turnover below a prescribed limit (currently 1.5 crores and 75 lakhs for special category state). Under this scheme, businesses are required to pay a fixed percentage of their turnover as GST and have simplified compliance requirements.

h.       Online Compliance: GST introduced an online portal, the Goods and Services Tax Network (GSTN), for registration, filing of returns, payment of taxes, and other compliance-related activities. It streamlined the process and made it easier for taxpayers to fulfill their obligations.

i.         Anti-Profiteering Measures: To ensure that the benefits of GST are passed on to the consumers, the government established the National Anti-Profiteering Authority (NAA). The NAA monitored and ensured that businesses do not engage in unfair pricing practices and profiteering due to the implementation of GST. All GST anti-profiteering complaints are now dealt by the Competition Commission of India (CCI) from December 1, 2022.

j.         Increased Compliance and Transparency: GST aims to enhance tax compliance by bringing more businesses into the formal economy. The transparent nature of the tax system, with the digitization of processes and electronic records, helps in curbing tax evasion and increasing transparency.

k.       Sector-specific Exemptions: Certain sectors, such as healthcare, education, and basic necessities like food grains, are given either exempted from GST or have reduced tax rates to ensure affordability and accessibility.

l.         Accounts would be settled periodically between the Centre and the States to ensure that the credit of SGST used for payment of IGST is transferred by the Exporting State to the Centre. Similarly, IGST used for payment of SGST would be transferred by the Centre to the Importing State. Further, the SGST portion of IGST collected on B2C supplies would also be transferred by the Centre to the destination State. The transfer of funds would be carried out on the basis of information contained in the returns filed by the taxpayers.

It's important to note that the GST framework is subject to changes and amendments are passed based on the evolving needs of the economy and the Government's policy decisions.