Important Updates and Due Date Compliances under GST for August 2022

Important clarifications/ amendments issued by the Government on GST in July/ August 2022 along with compliance timelines in August 2022

Compliance timelines

Updates in the month of July/ August 2022

1. CBIC issues notifications to implement changes in rate of goods and services based on the recommendation of 47th GST Council Meeting

CBIC has issued several notifications to implement the recommendations made by the GST Council w.r.t. changes in GST Rates of Goods & Services. These recommendations were made in the 47th GST Council meeting and now these changes have been notified which shall be effective from July 18th, 2022.

• 03/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend Notification No. 11/2017- Central Tax (Rate) dated 28.06.2017 w.r.t. rate of tax on services
• 04/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 w.r.t. Exempt Services (NIL rated services)
• 05/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend Notification No. 13/2017- Central Tax (Rate) dated 28.06.2017 w.r.t. Reverse Charge on certain specified Supplies of services
• 06/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend notification No. 1/2017- Central Tax (Rate) w.r.t. rate of tax on goods
• 07/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend notification No. 2/2017- Central Tax (Rate) w.r.t. exemption on supply of goods
• 08/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend notification No. 3/2017- Central Tax (Rate) w.r.t. conditional exemption on supply of goods
• 09/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend notification No. 5/2017- Central Tax (Rate) w.r.t. no refund of unutilised input tax credit because of inverted duty structure
• 10/2022-Central Tax (Rate) dated July 13th, 2022 - Seeks to amend notification No. 2/2022- Central Tax (Rate) w.r.t. conditional exemption on supply of bricks and tiles
• 11/2022-Central Tax (Rate) dated July 13th, 2022 - Rescinds notification No. 45/2017- Central Tax (Rate) w.r.t. applicability of concessional rate w.r.t. certain goods supplied to Public funded research institution, Departments and laboratories of the Central Government and State Governments and Regional Cancer Centre.

2. CBIC issues FAQs on GST applicability on 'pre-packaged and labelled' goods

Pursuant to the change in taxability of specified goods when bearing a registered brand or brand in respect of which an actionable claim or enforceable right in a court of law is available to imposition of GST on such goods when "pre-packaged and labelled", CBIC has issued certain clarifications on the scope of this change, particularly in respect of food items like pulses, flour, cereals, etc. (specified items falling under the Chapters 1 to 21 of the Tariff), as has been notified vide notification No. 6/2022-Central Tax (Rate), dated the 13th of July, 2022, and the corresponding notifications for SGST and IGST. The changes come into effect from today i.e. 18th of July, 2022. The FAQs can be downloaded here

3. Implementation of mandatory mentioning of HSN codes in GSTR-1

Vide Notification No. 78/2020 - Central Tax dated 15th October, 2020, it is mandatory for the taxpayers to report minimum 4 digits or 6 digits of HSN Code in Table-12 of GSTR-1 on the basis of their Aggregate Annual Turnover (AATO) in the preceding Financial Year. To facilitate the taxpayers, these changes are being implemented in a phase-wise manner on GST Portal. The detailed advisory can be accessed at https://tutorial.gst.gov.in/downloads/news/hsn_advisory_table_12_2.pdf It has been decided that w.e.f. 01st August, 2022, Taxpayers with AATO of more than 5 cr. would need to report HSN in table 12 of GSTR-1 as per below mentioned scheme: • Taxpayers would be required to mandatorily report 6-digit HSN code. • Manual user entry would be allowed for entering HSN or description and in case of a wrong HSN reported, a warning or alert message will be shown. However, taxpayers will still be able to file GSTR-1. • Taxpayers would be expected to correct HSN where there is an error and a warning message is shown.

Click here for the advisory.

4. Introducing new Table 3.1.1 in GSTR-3B for reporting supplies u/s 9(5) by Electronic Commerce Operators

According to section 9(5) of CGST Act, 2017, Electronic Commerce Operator (ECO) is required to pay tax on supply of certain services notified by the government such as Passenger Transport Service, Accommodation services, Housekeeping Services & Restaurant Services, if such services are supplied through ECO. For reporting of such supplies a new Table 3.1.1 is being added in GSTR-3B as per Notification No. 14/2022 - Central Tax dated 05th July, 2022 wherein both ECOs and registered persons can report their supplies made under section 9(5) respectively. The change in GSTR-3B will be made available on GST Portal from 1st August 2022.

(i) An ECO is required to report supplies made u/s 9(5) in Table 3.1.1(i) of GSTR-3B and shall not include such supplies in Table 3.1(a) of GSTR-3B. The applicable tax on such supplies shall be paid by ECO in Table 3.1.1(i) of GSTR-3B in cash only and not by ITC.

(ii) A registered person who is making supplies of such services as specified u/s 9(5) through an ECO, shall report such supplies in Table 3.1.1(ii) and shall not include such supplies in Table 3.1(a) of GSTR-3B. The registered person is not required to pay tax on such supplies as the ECO is liable to pay tax on such supplies.

Click here for the advisory.

5. CBIC appoints Principal Director General/ Director General of DGARM to withheld refund for verification of exporters

The CBIC has issued an order to authorise Principal Director General/ Director General of Directorate General of Analytics and Risk Management to exercise the functions under clause (c) of sub-rule (4) of rule 96 of the CGST Rules, throughout the territory of India. Rule 96(4)(c) provides that the claim for refund shall be withheld if the Commissioner in the Board or an officer authorised by the Board, on the basis of data analysis and risk parameters, is of the opinion that verification of credentials of the exporter, including the availment of ITC by the exporter, is considered essential before grant of refund, in order to safeguard the interest of revenue. Order No. 01/2022-GST dated July 21st, 2022

6. Advisory on Upcoming Changes in GSTR-3B

The Government vide Notification No. 14/2022 - Central Tax dated 05th July, 2022 has notified few changes in Table 4 of Form GSTR-3B requiring taxpayers to report information on ITC correctly availed, reversal thereof and declaring ineligible ITC in Table 4 of GSTR-3B. The notified changes in Table 4 of GSTR-3B are being implemented on the GST Portal and will be available shortly. Until these changes are implemented on the GST Portal, taxpayers are advised to continue to report their ITC availment, reversal of ITC and ineligible ITC as per the current practice. The taxpayers will be duly informed once these changes are made available on the GST Portal.

Click here for the advisory.

7. 18% GST on services provided by FSSAI; State levies are subject to GST under reverse charge: FSSAI Order

W.e.f. 18th July 2022, Government has withdrawn the GST exemption on services provided by the Food Safety and Standards Authority of India ('FSSAI') to Food Business Operators by way of licensing, registration and analysis/ testing of food. Thus these services of FSSAI are now subject to GST. In connection with this change, FSSAI has issued an order explaining the GST applicability on different services. The GST applicable on State License and Registration fee and penalties are on reverse charge basis. Therefore no GST is being charged through FoSCoS portal on State License and Registration fees and the penalties belonging to States/ UTs. The same is also printed on the receipt generated through FoSCoS. (File No. RCD-0100/7/2021 Dated July 27th, 2022)

8. E-Invoicing to be mandatory for assessees having AATO of more than 10 crores w.e.f. October 1st, 2022

Assessees having an Aggregate Annual Turnover (AATO) of over Rs. 10 crores in any of the FYs starting 2017-18 onwards, will be required to follow E-Invoicing w.e.f. October 1st, 2022. AATO includes the turnover of all GSTINs under a single PAN across India. The e-Invoice System is for GST registered persons for uploading all B2B invoices to the Invoice Registration Portal (IRP). The IRP generates and returns a unique Invoice Reference Number (IRN), digitally signed e-invoice and QR code to the user. One can visit https://einvoice1.gst.gov.in/ for more details. (Notification no. 17/2022 - Central Tax dated 1st August, 2022)

9. GSTN introduces single click NIL filing of GSTR-1

In order to further simplify the return filing experience a single click NIL filing of GSTR-1 has been introduced on GST Portal. Taxpayers can now file NIL GSTR-1 return by simply ticking the check box File NIL GSTR-1 available at GSTR-1 dashboard. Please note that Nil filing of GSTR-1 will not be allowed in case there is already saved records in GSTR-1. The taxpayers are advised to delete already saved records or reset GSTR-1 data by clicking RESET button available on GSTR-1 dashboard before filing NIL GSTR-1.

You may download the detailed advisory from here

10. Clarifications regarding applicable GST rates & exemptions on certain services

Certain issues on which representations had been received were examined by the GST Council in its 47th meeting held on 28th and 29th June, 2022. Pursuant to the said meeting and discussions held, issue-wise clarifications as recommended by the GST Council has been issued. (Circular Nos. 177/09/2022-TRU dt. 3rd August, 2022 and 178/10/2022-GST dt. 3rd August, 2022)

11. Clarification regarding GST rates & classification (goods)

CBIC has issued a Circular clarifying the rates of the following goods: 1. Electric vehicles whether or not fitted with a battery pack, attract GST rate of 5%; 2. Stones otherwise covered in S. No. 123 of Schedule-I (such as Napa stones), which are not mirror polished, are eligible for concessional rate under said entry; 3. Mangoes under CTH 0804 including mango pulp, but other than fresh mangoes and sliced, dried mangoes, attract GST at 12% rate; 4. Treated sewage water attracts Nil rate of GST; 5. Nicotine Polacrilex Gum attracts a GST rate of 18%; 6. Fly ash bricks and aggregate - condition of 90% fly ash content applied only to fly ash aggregate, and not fly ash bricks; 7. Applicability of GST on by-products of milling of Dal/ Pulses such as Chilka, Khanda and Churi. (Circular No. 179/11/2022-GST dt. 3rd August, 2022)

12. Impact on unsold stock manufactured /packed / imported prior to revision of GST and changes related thereto

Central government has permitted the manufacturers or packers or importers of pre-packaged commodities to declare the revised retail sale price (MRP) on the unsold stock manufactured /packed / imported prior to revision of GST, after inclusion of the applicable/ increased amount of tax or after reducing the reduced amount of tax due to GST, if any, in addition to the existing retail sale price (MRP) upto 31st January, 2023 or till such date the stock is exhausted, whichever is earlier. Declaration of the changed retail sale price (MRP) shall be made by way of stamping or putting sticker or online printing, as the case may be, after complying with the conditions as per the Circular. (Circular no. I-10/14/2020-W&M Section dt. 01.08.2022)

13. CBIC notifies exchange rates effective from August 5th, 2022

The Central Board of Indirect Taxes and Customs has notified the rate of exchange of conversion of the foreign currencies into Indian currency or vice versa, with effect from 5th August 2022, for import and export of goods. In this regard, notification has been issued in supersession of the Notification No.64/2022-Customs (N.T.) dated 21st July, 2022. Notification No.66/2022 -Customs (N.T.) dated 4th August, 2022

14. Allowing taxpayers to enter multiple trade names

Earlier only a single Trade Name was being captured during New Registrations and subsequent amendment in core field for Normal Taxpayer on the Portal. Now taxpayers have been provided with an option to provide up to 9 additional trade names for a single GSTIN registration through core field amendment. The Taxpayer can upload supporting document for trade name of size 5 MB. Both these new fields will be kept optional.

15. Option in Form RFD-01 to get refund arising out of excess payment in GSTR 4, for Taxpayer under Composition levy

Earlier the taxpayers who had opted for Composition levy were not able to file for refund in Form GST RFD-01 under refund category "Excess payment of Tax, if any" but had to choose the refund category "Any other". Now while filing annual return (GSTR-4), if the composition taxpayers have deposited excess tax, they will now be able to file for refund under category "Excess payment of Tax, if any". 

16. Functionality to search and view Advance Ruling Orders

Earlier, there was no functionality available to search for the Advance Ruling Orders issued by the Authority / Appellate Authority for Advance Ruling. A functionality has now been implemented on the Portal, under the menu Advance Ruling, in both Pre-login and Post-login, wherein the users would be able to search for Advance Ruling orders issued by all Advance Ruling forums. 

17. Activation of GSTR 9 and GSTR 9C for the FY 2021-22

GSTR 9 and GSTR 9C has been enabled on the GST portal. Taxpayers can now file their Annual Return in GSTR 9 and Reconciliation Statement in GSTR 9C, the last date for which is 31-12-2022. Please note that Annual return in Form GSTR-9 once filed cannot be revised. The computation of ITC has been made based on GSTR-1/IFF/GSTR-5 filed by the corresponding suppliers upto 15/07/2022. GSTR-1/IFF/GSTR-5 filed after the updation date will be covered in the next updation on the portal. GSTR-9 can be filed online. It can also be prepared on Offline tool and then uploaded on the Portal and filed. All applicable statements of Forms GSTR-1/IFF and returns in Form GSTR-3B of the financial year should have been filed before filing GSTR-9. In case, one is required to file GSTR-9C (Reconciliation statement and Certification), the same shall be enabled on the dashboard post filing of GSTR-9.