The Finance Minister, Smt. Nirmala Seetharaman presented the second digital union budget 2022-2023 on 1st February 2022. Accordingly, clauses 99 to 123 covered the proposed GST amendments.
It is important to note that amendments proposed vide clause 99 to clause 113 will be effective from the date to be notified. Whereas, amendments proposed vide clause 114 to clause 123 will be effective from the date on which the Finance Bill, 2022 gets enacted.
In the present article, we will briefly understand all the proposed GST amendments as introduced vide the Finance Bill, 2022.
Availment of Input Tax Credit Section 16(2)-
- The additional condition imposed for availment of Input Tax Credit-
One more condition is imposed for availment of Input Tax Credit. Accordingly, the input tax credit can be availed only if the said credit is not restricted as per the details communicated to the recipient under section 38 of the CGST Act.
Thus, the situation of the proposed amendment is summarized hereunder-
|Input Tax Credit
|Credit restricted as per GSTR-2B
|Input Tax Credit not available
|Credit not restricted as per GSTR-2B
|Input Tax Credit available
- Time limit for availment of the input tax credit amended-
It is proposed to extend the time limit for availment of input tax credit. According to which the registered person is allowed to avail the input tax credit of invoice/ debit note for the Financial Year within 30th November of the subsequent year.
Please note as per current provisions the registered person is allowed to avail the input tax credit of invoice/ debit note for the Financial Year within 30th September of the subsequent year.
Cancellation of the registration of the person Section 29(2)-
As per the amendment, GST registration of the person is liable to be cancellated under the following situation-
|Category of person
|The situation when GST registration is liable to be cancelled
|A person paying tax under section 10 i.e., Composition Dealer
|The person fails in furnishing the return of the financial year (i.e., Form GSTR-4) within three months from the due date of such return
|Any other person
|The person fails in furnishing the return for a continuous period as may be prescribed
The time limit for issuance of credit notes Section 34(2)-
The amendment proposes to extend the time limit for issuance of credit notes with regard to supplies made in a respective Financial Year. According to this the registered person is allowed to issue the credit notes for the supplies made in a Financial Year up to 30th November of the subsequent year (currently the time limit is 30th September).
Period for rectifying error/ omission in Form GSTR-1 and GSTR-3B Section 37(3)-
As per the proposed amendment, any rectification of error/ omission in respect of details furnished vide Form GSTR-1 and Form GSTR-3B will be allowed till 30th November following the end of the Financial Year to which the details relate (currently the period is 30th September).
GST Refund Section 54-
The amendment proposes that the refund claim of any balance in the ‘Electronic Cash Ledger’ will be made in a specified prescribed form and manner.
Further, it is proposed to provide a time limit of two years for claiming a refund on inward supplies of both the goods and services under section 55 of the CGST Act i.e., a refund for the specified agency.
Miscellaneous important amendments-
- It is proposed not to levy interest on input tax credit which is wrongly availed but not utilized. This amendment is proposed to be given retrospective effect from 1st July 2017.
- Rate of interest is reduced retrospectively in case of wrong availment and utilization of Input Tax Credit from 24% p.a. to 18% p.a.
- Retrospectively with effect from 22nd June 2017, GST portal i.e., gst.gov.in is notified as Common GST portal except E-Way bill and generation of invoice under rule 48(4) of the CGST Rules.
- Provisions of section 38 are substituted in order to prescribe the manner, conditions and restrictions for communication of details relating to inward supplies and input tax credit to the receiver by means of an auto-generated statement and also to do away with the two-way communication process in the return filing.
- Supply of unintended waste which is generated during the production of fish meal (heading 2301) (except fish oil) is being exempted during the period 1st July 2017 till 30th September 2019. However, the refund will not be eligible, if the said tax is collected.
- Service of the grant of alcoholic liquor license against consideration by the State Government will retrospectively i.e., from 1st July 2017 be treated neither as a supply of goods nor a supply of service. However, no refund will be made of tax that has been collected.
- Late fees will be leviable under section 52, in case of delay in filing of TCS return in Form GSTR-8.
- The following sections are omitted with a purpose to do away with the two-way communication process in GST return filing-
- Section 42 – Matching, reversal and reclaim of ITC
- Section 43 – Matching, reversal and reclaim of reduction in output tax liability
- Section 43A – Procedure for furnishing return and availing ITC.
- The due date for furnishing GST return in From GSTR-5 by the non-resident taxable person is proposed to be amended to 13th day of the following month (currently the same is the 20th day of the following month).