Subject: Difficulty in filing appeals on the GST portal in cases where adjudication orders reflect “NIL” demand due to prior voluntary payment – reg.
1. Introduction
It has come to the notice of GSTN that certain taxpayers are facing difficulties in filing appeals on the GST portal against demand orders wherein the demand amount is reflected as “NIL,” despite the existence of a dispute regarding tax liability.
This situation generally arises in cases where the taxpayer has made payment of tax, interest, or penalty (fully or partially) at the stage of issuance of the Show Cause Notice (SCN), without admitting the liability, and the adjudicating authority has subsequently issued a demand order treating such payment as full discharge of the demand without explicitly determining and recording the liability.
2. System Behaviour on GST Portal (Demand and Collection Register – DCR)
When a demand order is issued by the tax officer, the GST portal creates a Demand ID in the Demand and Collection Register (DCR), also known as the liability ledger.
In cases where the tax officer issues a demand order with a NIL amount, an entry is created with zero value, indicating that there is no outstanding liability. When the taxpayer attempts to file an appeal application (APL-01) against such a demand order, the portal restricts the filing of the appeal and may display an error such as: “Disputed amount cannot be more than demand amount itself.”
Since no liability is reported by the tax officer on the GST portal, the system blocks the taxpayer from filing an appeal.
3. Nature of Issue:
It is clarified that:
Payment made during the SCN stage, without explicit admission of liability, does not amount to acceptance of the demand.
In such cases, the taxpayer retains the right to contest the liability and file an appeal under Section 107 of the Central Goods and Services Tax Act, 2017.
However, where the adjudication order incorrectly reflects a “NIL” demand, the taxpayer is unable to exercise this statutory right due to the NIL demand reflected in the system.
4. Alternate solution:
In cases where a dispute regarding liability exists but is not captured by the department in the demand order, and payment has been made prior to the issuance of the demand order, the taxpayer is advised to approach the adjudicating authority for issuance of a rectification order.
The taxpayer may file such rectification requests using the option available on the GST portal. Upon receipt of the rectification order reflecting the correct demand amount, the taxpayer may proceed to file an appeal on the GST portal within the prescribed time limits.
Subject: Guidance for Accurate Entry of RR No./eT-RRs following the Integration of E-Way Bill (EWB) with Freight Operation Information System (FOIS) system of Indian Railways.
Dear Taxpayers,
This advisory is being issued to inform you that the FOIS of Indian Railways has now been integrated with the E-Way Bill (EWB) system via Application Programming Interfaces (APIs).
In light of this, it is important that taxpayers follow the correct process for entering RR no (Railway Receipt Number)/eT-RRs. into the EWB system. Adherence to the guidelines below will help avoid any potential discrepancies or mismatches.
Taxpayers transporting goods via the Indian Railways FOIS must ensure the correct entry of the number or RR No./eT-RRs in the EWB system. The format for entering RR No./eT-RRs has been standardized to ensure consistency and accuracy.
a) Suppliers with a pre-existing E-Way Bill (EWB) for goods transported from the factory to the railway station, and who are subsequently transporting goods by rail under the FOIS, must follow these steps:
i. Update Part-B of the E-Way Bill using the “Multi-Transport Mode” option on the EWB portal.
ii. In the updated section, select Rail as the mode of transport..
After selecting this option, the system will prompt you to enter the corresponding RR No./eT-RRs
3. RR Number/eT-RRs for FOIS
For goods transported via the Freight Operations Information System (FOIS) the RR number shall be entered in the following format in the EWB system.
Format: F<FromStationCode><RR No>
For eg: If the goods are dispatched from the station SJWT and RR no. is 123456789 then the same needs to be entered as FSJWT123456789
4. EWB and RR No./eT-RRs Validation
After entering the RR No./eT-RRs into the EWB system:
a) The EWB system will validate the RR No./eT-RRs against the data received from the FOIS.
b) If a mismatch is detected or the RR No./eT-RRs is not found in the database, an alert will be generated. Thus it is strongly advised that taxpayers ensure the correct entry of RR No./eT-RRs to avoid future discrepancies
5. Importance of Accurate Entry
It is crucial for taxpayers to ensure that the RR number/eT-RRs is entered correctly in the EWB system to allow smooth tracking and verification of goods being transported via Indian Railways. Accurate entry will also facilitate the validation process and avoid unnecessary delays or complications.
6. Assistance and Clarifications
For further assistance or if there are any discrepancies in entering RR No./eT-RRs taxpayers are encouraged to raise a ticket with the support team, clearly mentioning the RR No./eT-RRs.
The customers who are transporting goods using Railway FOIS system shall adhere to the guidelines issued by Indian Railways for e-Demand customers.
GSTN has issued an advisory today outlining the steps for individuals to pay their tax demand under the GST Amnesty Scheme.
If you are looking to apply for the Goods and Services Tax (GST) amnesty scheme, which eliminates interest and penalties from specified GST tax demand notices, take note of this updated process. This information was released by GSTN on November 8, 2024. The advisory states that the necessary forms for the scheme—GST SPL-01 and GST SPL-02—are currently under development and are expected to be available by the first week of January 2025. As a result, individuals wishing to settle their tax demand under the scheme can do so using an alternative form in the interim.
“In this regard, it is informed that Form GST SPL-01 and Form GST SPL-02 are under development and are tentatively scheduled for release on the common portal in the first week of January 2025. Meanwhile, taxpayers are advised to pay the demanding tax amount from the notice, statement, or order issued under Section 73 on or before March 31, 2025, to secure the waiver benefits by paying their taxes within the deadline,” stated GSTN in the advisory dated November 8, 2024.
Taxpayers wishing to apply for the GST Amnesty Scheme without waiting for the GST SPL-01 and SPL-02 forms can utilize the DRC-03 form (or DRC-03A for specific cases) or can pay the tax demand through the electronic liability register, accessible in the post-login section of the GST portal via the path: Services > Ledgers > Electronic Liability Register > Part-I: Return related liabilities. By utilizing this method, taxpayers can initiate their application for the GST amnesty scheme immediately.
This advisory brings clarity regarding the availability of Forms SPL-01 and SPL-02, provisionally confirming their release for January 2025. While the timeline remains tentative, it delivers a clear direction for taxpayers, allowing them to transition from uncertainty to proactive preparation. This assurance enables taxpayers to concentrate on their priorities without the ongoing worry of checking the portal, facilitating a more organized approach to utilizing the Amnesty Scheme.
The advisory presents somewhat of a contradiction—it encourages taxpayers to make payments by the due date to benefit from the waiver scheme while acknowledging that the necessary forms to officially apply for these benefits are still being developed.
Which Form to Use to Apply for the GST Amnesty Scheme Now
According to GSTN’s advisory, taxpayers can settle the tax demand through the “payment towards demand” feature for demand orders and by utilizing Form GST DRC-03 for notices. However, if payment has already been made through Form GST DRC-03 for any demand order, taxpayers need to link the submitted Form GST DRC-03 to that demand order using Form GST DRC-03A, which is currently accessible on the common portal.” This explanation clarifies which taxpayers must file the DRC-03 Form and which should use the electronic liability register for tax payment.
Use DRC-03 (and DRC-03A in specified cases) if you are: Taxpayers who received a show cause notice (SCN) without an adjudicating order. If a taxpayer made a part payment (e.g., paid Rs 150 for a tax demand of Rs 200), the adjustment can be completed by filing the DRC-03A form.
For the Electronic Liability Ledger: Taxpayers who have had an original adjudicating order issued but are still awaiting the order in appeal must pay the tax demand through the electronic liability ledger.
Taxpayers may choose to wait for the release of the SPL-01 and SPL-02 forms, expected by the first week of January 2025. However, for those who prefer not to wait when applying for the GST Amnesty Scheme, the above process can be followed.
GSTN noted in the advisory that the GST council had recommended waiving interest and penalties in demand notices or orders issued under Section 73 of the CGST Act, 2017 (applicable to cases not involving fraud, suppression, or willful misstatement) for the financial years 2017-18, 2018-19, and 2019-20. This initiative aims to decrease tax disputes and provide relief to taxpayers. To qualify for this waiver, the condition is that the full demanded tax must be paid by March 31, 2025.
Advisory for furnishing bank account details before filing GSTR-1/IFF Notification No. 38/2023 – Central Tax New Delhi, the 4th August, 2023
1. As per Rule 10A of Central Goods and Services Tax Rules, 2017 notified vide notification no. 31/2019 dated 28.06.2019, a taxpayer is required to furnish details of a valid Bank Account within a period of 30 days from the date of grant of registration, or before furnishing the details of outward supplies of goods or services or both in FORM GSTR-1or using Invoice Furnishing Facility (IFF), whichever is earlier.
2. Advisory and various communications have already been issued time to time to inform the taxpayers regarding furnishing the details of a valid Bank Account detail in the GST Registration.
3. Now, from 01st September, 2024 this rule is being enforced. Therefore, for the Tax period August-2024 onwards, the taxpayer will not be able furnish GSTR-01/IFF as the case may be, without furnishing the details of a valid Bank Account in their registration details on GST Portal.
4. Therefore, all the taxpayers who have not yet furnished the details of a valid Bank Account details are hereby requested to add their bank account information in their registration details by visiting Services > Registration > Amendment of Registration Non – Core Fields tabs on GST Portal.
5. It is informed that in absence of a valid bank account details in GST registration, you will not be able to file GSTR-1 or IFF as the case may, be from August-2024 return period.
1. Gujarat GST Audit Manual Clarified Some Of The Issue Pertaining to GST:
(1) A reseller is returning time expired goods to his distributor. Suppose, both the reseller and the distributor are registered as normal tax payers.
If, in the supply chain someone destroys the expired goods what will be the treatment in GST? If the reseller in above example is under composition scheme or unregistered person then what are the processes?
So, many questions may arise. Circular No. 72/46/2018-GST dt.26.10.2018 clarifies some of these aspects.
(2) During audit the officer noticed that Mr. X is an independent director of the Auditee to whom the company paid Rs.1.5 Cr. as yearly remuneration. Whether this remuneration is leviable to GST?
The services provided by the directors who are not the employees of the company are outside the scope of Schedule III of the GGST Act and are therefore taxable. In terms of entry at Sl. No. 6 of the Table annexed to notification No. 13/2017 – CT (R) dated 28.06.2017, the recipient of the said services i.e. the Company, is liable to discharge the applicable GST on it on reverse charge basis. Clarification in Circular No: 140/10/2020 – GST dt. 10.06.2020 is relevant for audit officers in this case.
(3) ABC Printers has made supplies against two different printing orders:
a. Printing of brochures of a real-estate company where only the content is provided by the real- estate company.
b. Printing of envelopes and letter pads with the logo of the developer. Whether the above supplies are supplies of goods or service?
The first case is a composite supply of goods (paper, ink) as well as services (printing) where printing of the content supplied by the recipient of supply is the principal supply. Hence, tax in this case will be guided by the tax rate of printing services.Clarification in Circular No: 11/11/2017-GST dated: 20.10.2017
In the second case too, the printing has been made as a part of composite supply, but the supply of printing of the content supplied by the recipient of supply is ancillary to the principal supply of goods. Therefore, in the second case, the tax rate of goods will prevail.
(4) Fabrication of buses may involve the following two situations:
a)Bus body builder builds a bus, working on the chassis owned by him and supplies the built-up bus to the customer.
b) Bus body builder builds body on chassis provided by the principal for body building.
Whether the above supplies are supply of goods or service?
In the above context, for situation (a) above, the supply made is that of bus, and accordingly supply would attract GST@ 28%. In situation (b) above, fabrication of body on chassis provided by the principal (not on account of bodybuilder), the supply would be treated as service, and 18% GST as applicable will be charged accordingly.
(5) Popcorn is available in packets both as ready to eat and ready to fry. Whether GST rate is same in both the cases?
A packet of corn, which needs to be heated before eating would attract GST @5%. But, ready to eat popcorn bag or packet attracts 18% GST.Vide, AAR- Gujarat: Jay Jalaram Enterprises [2020]117.
(6) A manpower agency is extracting minerals from a mine owned by another person. Is it supply of goods or services?
Applicant is providing a support in extraction of mineral and therefore it is a kind of supplying support Service.
In view of the above, we find that the Applicant is providing supporting service related to mining. The said service is classifiable under HSN 998622. The rate of GST on the said service is 18% (CGST 9% + SGST 9%) as provided under the Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017. AAR-Rajasthan (KSC Buildcon (P) Ltd.]
(7) As per sec 17(5)(d) ITC is blocked when an RTP procures goods and services for construction of any immovable property on his own account, which is capitalized, including when such goods or services or both are used in the course or furtherance of business.
Now, whether ITC is admissible on lease rent paid during pre-operative period for the leasehold land on which a resort is being constructed to be used for furtherance of business?
Input Tax Credit is not available for lease rent paid during pre-operative period for the leasehold land on which the resort is being constructed on his own account to be used for furtherance of business, when the same is being capitalized and treated as capital expenditure. Vide, AAR, WB, GGL Hotel & Resort Company Limited, 30/WBAAR/2018-19 dated 08/01/2019
(8) If consumable inputs like furnace oil, zinc etc. are not returned to any principal from a job performing job of galvanizing within the specified time limit whether it will be treated as supply in GST?
The goods like furnace oil, zinc etc. consumed in the process of galvanizing are inseparable from the galvanized goods. If return of the galvanized goods to the principal satisfies the condition of receiving back the inputs in accordance with section 143(1)(a) of the GST Act and the goods like furnace oil, zinc etc. have been entirely used up in the process of galvanizing then question of returning of furnace oil, zinc etc. should not arise and not be treated as supply.
(9) Whether any sale done by the liquidator of the assets of a corporate debtor under the provisions of the Insolvency and Bankruptcy Code, 2016 is a “supply” under GST?
The sale of the assets of a corporate debtor is a supply of goods by the liquidator, who is required to take registration u/s 24 of the GST Act. If she is already registered as a distinct person of the corporate debtor in terms of Notification No. 11/2020 – Central Tax dated 21/03/2020, she should continue to remain registered till her liability ceases under section 29 (1) (c) of the GST Act.Vide, AAR, WB,M/s Mansi Oils and Grains Pvt Ltd,02/WBAAR/2020-21 dt 29/06/2020
(10) Whether medicines and surgical goods supplied by Hospitals and nursing homes to the inpatients and outpatients are exempted?
The supply of medicines & other surgical goods by the hospital from its pharmacy to inpatients are in the course of providing health care services which are bundled and are provided in conjunction with each other, would be considered as “Composite Supply” &
eligible for exemption under ‘health care services’.
The supply of medicines & other surgical goods by the hospital from its pharmacy to outpatients not a part of health care services is a taxable supply of goods and thereby GST is applicable. [Vide, AAR, Kerala, M/s Baby Memorial Hospital Ltd, KER/57/2019 dt 05.09.2019]
(11) Whether Input credit on Purchase of Lift would be available to Hotel as it has been used in the course or for the furtherance of business?
The input tax credit of tax paid on Lifts procured and installed in hotel building shall not be available to the applicant as the same is blocked in terms of Section 17(5)(d) of the CGST Act 2017, become an integral part of the building which is immovable property. [Vide:- Jabalpur Hotels Pvt Ltd (GST AAR Madhya Pradesh),
2. AAR & Judicial Decisions:
(i) Hon’ble Delhi Highcourt Decision On Refund can not be rejected on minor error which can be rectifiable:
(Applicant – M/s. Shri Shyam Footwear)
The Highcourt has set aside the order of the Revenue Department rejecting the refund application of the assessee on the grounds that the rectified information submitted by the assessee was not taken into account while passing such order. Held that, the assessee cannot be penalised for an inadvertent error in submitting an erroneous information, which had already been rectified. Further that, it is essential for the Revenue Department to examine the information as submitted by the assessee and process its claim for refund of unutilized Input Tax Credit (“ITC”) in accordance with law.
(ii) Hon’ble Madras Highcourt Decision On Assessee can be liable to attend proceeding of CGST and SGST Authority subject to different subject matter:
(Applicant – Tvl Metal Trade Incorporation)
The Highcourt has held that, the State Tax Authority cannot prosecute the assessee, when the Central Tax Authority has already initiated action in respect of the very same subject matter. Further held that, to substantiate such defence, the assessee has to participate in the personal hearing/ enquiry and only then it can be ascertained whether the proceedings initiated by the Central and State Tax Authority are one and the same involving the same subject matter. Directed the assessee to appear before the Revenue Department and state all its objections.
(iii) AAR On Classification of stepper motor under Sub-heading 85011012:
(Applicant – Hitachi Astemo FIE Private limited)
CAAR Delhi held that stepper motor (3800-B07F-0000) proposed to be imported by the applicant for use in manufacture of idle air control valve will be classifiable under Sub-heading 8501 10 12 of the First Schedule of the Customs Tariff.
This publication contains information for general guidance only. It is not intended to address the circumstances of any particular individual or entity. Although the best of endeavour has been made to provide the provisions in a simpler and accurate form, there is no substitute to detailed research with regard to the specific situation of a particular individual or entity. We do not accept any responsibility for loss incurred by any person for acting or refraining to act as a result of any matter in this publication.
