Key Analysis of CGST Notifications issued on 31/03/2023
Recently, Government has issued various notifications to give effect to the recommendations of the GST Council in its 49th Meeting held on 18th February, 2023.
Gist of all the notifications is given hereunder:
1. Amnesty schemes for non-filers of return:
i. Late Fee reduced/waived on non-filing of GSTR-4: Registered persons who fail to furnish the return in FORM GSTR-4 for the quarters from July, 2017 to March 2019 or for the Financial years from 2019-20 to 2021-22 then they have to pay late fee of Rs. 500/- only (Rs. 250 CGST + Rs. 250 SGST) provided that said return should be filed between the period from the 01/04/2023 to the 30/06/2023.
However, no late fee shall be payable if the central tax payable in the said return is nil.
[Notification number 2/2023-Central Tax]
ii. Amnesty scheme for deemed withdrawal of assessment orders issued under Section 62: According to Section 62(1) of CGST Act, 2017, if a registered person fails to furnish return as per provisions of the CGST Act, then the proper officer may assess the tax liability of the said person to the best of his judgement and issue Assessment Order accordingly. Further, Section 62(2) of the CGST Act, 2017 that where the registered person furnishes a valid return within 30 days of the service of the assessment order, then said assessment order shall be deemed to have been withdrawn.
Some persons could not file return within time limit of 30 days of service of notice, therefore, they were facing some hardships and difficulties. To give them relaxation, government has issued Notification Number 6/2023-CT wherein it is prescribed that if such registered persons furnish required return on or before the 30/06/2023 then said assessment order issued under subsection 62(1) of the CGST Act, 2017 shall be deemed to have been withdrawn.
[Notification number 6/2023- Central Tax]
Original Notification can be accessed at below link
https://taxinformation.cbic.gov.in/view-pdf/1009688/ENG/Notifications
iii. Late Fee reduced/waived on non-filing of Annual Return in Form GSTR-9: Registered persons who fail to furnish the Annual Return for any of the financial years 2017-18, 2018-19, 2019-20, 2020-21 or 2021-22, then they have to pay late fee of Rs. 20,000/- (Rs. 10,000 CGST + Rs. 10,000 SGST) only provided that said return should be filed between the period from the 01/04/2023 to the 30/06/2023.
[Notification number 7/2023- Central Tax]
iv. Late Fee reduced/waived on non-filing of Final Return: Registered persons who fail to furnish the Final Return in Form GSTR-10 then they have to pay late fee of 1,000/- (Rs. 500 CGST + Rs. 500 SGST) only provided that said return should be filed between 01/04/2023 to 30/06/2023.
[Notification number 8/2023- Central Tax]
Original Notification can be accessed at below link
https://taxinformation.cbic.gov.in/view-pdf/1009690/ENG/Notifications
[Notification number 3/2023- Central Tax]
2. Other amendments:
i. Procedural Amendment in process of Registration Application: Government has amended Rule 8 of CGST Rules, 2017 prescribing the process of application of registration. It is prescribed that while submitting the registration application, if an applicant opts for authentication of Aadhaar number then the date of submission of the application in such cases shall be the date of authentication of the Aadhaar number, or fifteen days from the submission of the application in Part B of FORM GST REG-01 under sub-rule (4), whichever is earlier.
Provided that the application for registration which is identified on the portal based on data analysis and risk parameters, shall be deemed to be complete only after the biometric-based Aadhaar authentication and taking photograph of the applicant in case of an individual or of such individuals in relation to the applicant as notified where the applicant is not an individual, along with the verification of the original copy of the documents uploaded with the application in FORM GST REG-01 at one of the notified Facilitation Centres.
It may be noted here that above proviso would be applicable only in Gujarat.
[Notification number 4/2023- Central Tax & Notification number 5/2023- Central Tax]
Original Notification can be accessed at below link
https://taxinformation.cbic.gov.in/view-pdf/1009686/ENG/Notifications
(ii) Reduction in late filing of Annual Return in Form:
Besides the above amendments, government has also reduced late fee on filing annual return for Financial Year 2022-23 onwards as per following table:
Sl. No. | Aggregate turnover during the Financial Year | Late fee after amendment | Late fee before amendment |
1 | Aggregate Turnover ≤ Rs. 5 Crores | Rs. 50/- (Rs. 25 CGST + Rs. 25 SGST) per day or 0.04 (0.02 CGST+ 0.02 SGST) per cent. of turnover in the State / Union territory whichever is lower
| Rs. 200/- (Rs. 100 CGST + Rs. 100 SGST) per day or 0.50 (0.25 CGST+ 0.25 SGST) per cent. of turnover in the State / Union territory whichever is lower
|
2 | Aggregate Turnover > Rs. 5 Crores ≤ 20 Crores | Rs. 100/- (Rs. 50 CGST + Rs. 50 SGST) per day or 0.04 (0.02 CGST+ 0.02 SGST) per cent. of turnover in the State / Union territory whichever is lower
| |
3 | Aggregate Turnover > Rs. 20 Crores | No Change
|
[Notification number 7/2023- Central Tax]
Original notification can be accessed at below link:
https://taxinformation.cbic.gov.in/view-pdf/1009689/ENG/Notifications
iii. Extension of time limit for issuance of order for recovery of tax/ITC:
Section 73(10) of the CGST Act, 2017 states that where tax/ITC is recoverable from the Assessee due to any reason other than fraud or any wilful misstatement or suppression of facts then the proper officer shall issue the order for recovery of tax/ITC within three years from the due date for furnishing of annual return for the relevant financial year.
Now, Government has extended above time limit for the Financial Year 2017-18 to 2019-20 as below:
(i) for the financial year 2017-18, up to the 31st day of December, 2023;
(ii) for the financial year 2018-19, up to the 31st day of March, 2024;
(iii) for the financial year 2019-20, up to the 30th day of June, 2024.
3. Changes in Compensation Cess:
- Rate of compensation cess on various items has been changed vide Notification number 02/2023-Compensation Cess (Rate) dated 31/03/20123
- The CBIC vide Notification No. 01/2023-Compensation Cess dated 31/03/2023, has notified the date to be 01/04/2023 for the applicability of provisions of Section 163 of the Finance Act, 2023.
Notification No. 2: https://taxinformation.cbic.gov.in/view-pdf/1009682/ENG/Notifications