Dear Professional colleagues,

Greetings of the Day !

Ministry of Finance had issued a Press release dated December 17, 2022, regarding recommendations made by GST council in its 48th GST Council meeting

Highlights:

• No GST is payable where the residential dwelling is rented to a registered person if it is rented it in his/her personal capacity for use as his/her own residence and on his own account and not on account of his business.
• Incentive paid to banks by Central Government under the scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions are in the nature of subsidy and thus not taxable
• Decriminalization under GST: The Council has recommended to -

• raise the minimum threshold of tax amount for launching prosecution under GST from Rs. One Crore to Rs. Two Crores, except for the offence of issuance of  invoices without supply of goods or services or both;
• reduce the compounding amount from the present range of 50% to 150% of tax amount to the range of 25% to 100%;
• decriminalize certain offences specified under clause (g), (j) and (k) of sub-section (1) of section 132 of CGST Act, 2017, viz.-
• obstruction or preventing any officer in discharge of his duties;
• deliberate tempering of material evidence;
• failure to supply the information.

• Refund to unregistered buyers in case of cancellation of service agreements: There is no procedure for claim of refund of tax borne by the unregistered buyers in cases where the contract/ agreement for supply of services, like construction of flat/house and long-term insurance policy, is cancelled and the time period of issuance of credit note by the concerned supplier is over. The Council recommended amendment in CGST Rules, 2017, along with issuance of a circular, to prescribe the procedure for filing application of refund by the unregistered buyers in such cases.
• The Council recommended to prescribe the mechanism for reversal of input tax credit by a registered person in the event of non-payment of tax by the supplier by a specified date and mechanism for re-availment of such credit, if the supplier pays tax subsequently. This would ease the process for complying with the condition for availment of input tax credit under section 16(2)(c) of CGST Act, 2017.
• GST council willcome out with a circular on procedure for verification of input tax credit in cases involving difference in input tax credit availed in FORM GSTR-3B vis a vis that available as per FORM GSTR-2A during FY 2017-18 and 2018-19.
• Filing of GSTR -1, 3B, 8 and 9/9C will be restricted to a maximum period of three years from the due date of filing of the relevant return / statement.