Proposed Changes in GST in Budget 2022

Proposed changes in GST in Budget 2022

1.) A new clause to Section 16(2) of CGST Act, 2017 is inserted to provide that Input tax Credit with respect to a supply can be availed only if such credit is not restricted by the GSTR 2A/2B returns. Further, Section 16(4) of CGST Act 2017, is amended to provide that the time limit to claim ITC shall be extended from due date of GSTR 3B of September to 30th November of the following financial year to which invoice pertains.

2.) Clause (b) of Section 29(2) of CGST Act, 2017 is proposed to be amended to give the effect that, proceedings for cancellation of registration can be initiated by Proper Officer against the return defaulters for not filing the GST return:

(a) in case of composition tax-payers, if the GST return for a Financial Year is not filed beyond three months from the due date of the said return,

(b) and in case of regular tax-payers, a cumulative time limit shall be

3.) The time limit to issue a credit note under section 34(2) of CGST Act, 2017 is proposed to be extended from the due date of GSTR 3B of September to 30th November of the following financial year in which such supply is made.

4.) The first proviso to section 37(1) of CGST Act 2017 and Section 37(2) of CGST Act, 2017 is proposed to be omitted to amend the conditions and restrictions provided under the section 37 for furnishing details of Outward supplies in form GSTR 1 and to delete the process of accepting/rejecting the details communicated among the supplier and recipient.

5.) Further, Sub-section 3 of Section 37 of CGST Act 2017 is omitted in such a way that the last date for making rectification or correction in the Form GSTR 1 is extended to 30th day of November of the following financial year and a new sub-section 4 to section 37 of CGST Act 2017 is inserted, which puts restriction on filing of GSTR 1 unless previous month’s GSTR 1 is duly filed.

6.) The provisions of section 38 of CGST Act, 2017 is proposed to be modified to provide that an auto-generated statement in Form GSTR 2A/2B will be made available to the recipient, containing details of inward supplies in respect of which ITC shall be available.

7.) An amendment to Section 39(5) of CGST Act, 2017 is proposed to provide that the GST return by a Non-Resident Taxable Persons can be filed on or before the 13th day of the following Further, first proviso of sub-section 7 is proposed to be amended to introduce the new facility to pay any other amount in addition to the regular tax liability during the month through GSTR 3B subject to the conditions and restrictions as may be prescribed. The section is further amended to provide the rectification of any detail furnished in GSTR 3B that can be made up to 30th November of the following financial year. Section 39(10) of CGST Act is proposed to be amended to provide restriction on filing of GSTR 3B for any tax period unless GSTR 1 for the said tax period is not filed.

8.) The late fee for 100 per day is proposed to be inserted in section 47 of CGST Act, 2017 for delay in furnishing of TCS statement.

9.) Section 48 of the CGST Act, 2017 is proposed to eliminate the requirement of furnishing details of inward supplies in form GSTR 2 by the GST taxpayer. Further, section 168 of CGST Act 2017 is proposed to be amended to remove the reference of section 38(2) of CGST Act 2017, which states the power of commissioner to issue direction for furnishing timely details of inward supplies in form GSTR-2.

10.) Section 49(10) of CGST Act, 2017 is proposed to be substituted in such a way that widens the scope of Form PMT-09 for transfer of electronic cash ledger balance among distinct person u/s 25(4) and 25(5) (branch/units registered with same PAN) subject to the conditions as may be prescribed and said transfer shall be deemed to have been Further, sub-section 12 of section 49 is proposed to be amended to impose restrictions on utilization of electronic credit ledger balance and to prescribe the maximum proportion of output tax liability which may be discharged through electronic credit ledger.

11.) The provision of section 50(3) of CGST Act, 2017 is proposed to be substituted retrospectively e.f. 01st July 2017 for levy of interest where the input tax credit has been wrongly availed and utilized. The rate of interest is proposed to be reduced from 24% to 18%. The retrospective changes are also proposed to be made in the respective IGST Act, 2017 and UTGST Act, 2017.

12.) The proviso to Section 52(6) of CGST Act, 2017 is proposed to be amended to provide that any rectification of error/omission in the particulars furnished in TCS return by Electronic Commerce Operators can be made earlier of the two dates (i) 30th day of November of following financial year or (ii) the date of filing of Annual Return.

13.) An amendment to section 54(1) of the CGST Act, 2017 is proposed to explicitly provide the form and manner to file the refund claim of any balance in Electronic cash ledger.

14.) Further, section 54(2) of the CGST Act, 2017 is proposed to extend the time limit to claim refund of tax paid on inward supplies from six month to 2 Years where the application of refund is filed by specialized agency of the UNO or any MFIO, Consulate or Embassy of foreign countries or any other notified class of person.

15.) Furthermore, section 54(10) of the CGST Act, 2017 is proposed to extend the scope of withholding of or recovery from refunds in respect of all types of refunds.

16.) A new clause (ba) to clause (2) of the explanation of Section 54 of CGST Act is proposed to be inserted to provide the clarity regarding the relevant date for filing refund claim in respect of supplies made to SEZ unit or developer.

17.) Section 146 of CGST Act, 2017 notifies the gst.gov.in as common GST electronic portal for facilitating registration, payment of tax, and all functions provided under CGST Rules, 2017. Additionally, for generation of e-way bills and preparation of e-invoices different respective portals are notified.

18.) The retrospective effect of notification dated 30th September 2019 is proposed which notifies to exclude the service by way of grant of alcoholic liquor license, against consideration in the form of license fee or application fee or by whatever name called, by the State Governments in which they are engaged as public authorities from the definition of Supply u/s 7 of CGST Act, 2017 and no refund will be granted for the tax wrongly collected prior The retrospective effect is also proposed to be made in respective IGST Act, 2017 and UTGST Act.

19.) The retrospective exemption from Central Tax is proposed for supply of unintended waste generated during the production of fish meal (falling under heading 2301), except for fish oil, during the period commencing from the 1st day of July 2017 and ending with the 30th day of September 2019 and no refund will be granted for the tax wrongly collected prior The retrospective effect is also proposed to be made in respective IGST Act 2017 and UTGST Act, 2017.

20.) The provisions related to section 42, 43 and 43A of CGST Act, 2017 is proposed to be removed which states the process of accepting/rejecting the details communicated among the supplier and recipient.

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