1. NO ITC UNLESS REFLECTED IN GSTR 2A/2B

Input Tax Credit shall not be available unless details of invoices uploaded by supplier in Form GSTR-1 are communicated to the recipient (i.e reflected in GSTR 2A/2B). Margin of 5% will no more be available.

2. DIFFERENCE B/W GSTR -1 & 3B: DIRECT RECOVERY

Section 75(12) is amended to provide that tax declared under GSTR-1 but not included in GSTR-3B, will be considered as “Self Assessed Tax” and hence, direct recovery of such tax under Section 79 will be possible even without issuing any Show Cause Notice.

3. BLOCKING OF GSTR-1 FOR NON FILING OF GSTR 3B

GSTR-1 return filing facility will be blocked if a registered Taxpayer have not submitted the return in FORM GSTR-3B for the previous two return periods. For example, if a taxpayer has not filed GSTR-3B for October 2021 and November 2021, the GSTR-1 filing facility will be blocked from the 1st January 2022.

4. CORRECTION IN INVERTED DUTY STRUCTURE IN FOOTWEAR AND TEXTILES SECTOR

The GST Council recommended to introduce GST rate changes from January 2022 in order to correct the inverted duty structure in the Footwear and Textile Sector. All footwear, irrespective of prices will attract GST at 12 percent, while barring cotton, all textile products including readymade garments will have GST at the rate of 12 percent.

5. E-WAY BILL: 200% PENALTY TO RELEASE GOODS

At present, full tax and 100% penalty is required to be paid to release the goods which are seized for violation of E-way Bill related provisions and for non-carrying of other documents under Section 129. Now, it is provided that goods will be released on payment of penalty equal to 200% of tax and tax will be recovered through separate proceedings.

6. PROVISIONAL ATTACHMENT OF ASSETS OF BOGUS BILLING BENFICIARIES ALSO

Not only supplier and recipients but assets of the beneficiaries of bogus billing can also be provisionally attached.

7. SCOPE OF PROVISIONAL ATTACHMENT WIDENED

Provisional attachment is made applicable in all cases of proceedings of Assessment, Inspection, Search, Seizure and Arrest or Demands and recovery. Now, provisional attachment of property, like bank accounts, can be done not only in the case of Show Cause Notices and investigation but also for other proceedings like Scrutiny of Returns and tax collected but not paid.

8. 25% PRE-DEPOSIT FOR E-WAY BILL APPEALS

For filing appeals, before first appellate authority against order for violation of E-way bill and other provisions, it will be mandatory to pay pre-deposit of amount equal to 25% of penalty imposed.

9. E-WAY BILL CO-NOTICEE MAY NOT GET FREE BY PAYMENT OF 200% PENALTY BY MAIN NOTICEE

Where proceedings against main person liable to pay tax have been concluded under Section 74, proceedings against co-noticee are also deemed to be concluded as provided under Explanation 1(ii) to Section 74. However, now, such benefit will not be available to co-noticee for proceedings initiated to impose penalties for violation of E-way bill.

The changes are in terms of the recommendations of the recent GST Council meeting with an eye to curb evasion of tax.

The above message will serve as a one point reference for compression of important changes.

For more such news please visit our website or contact us.

CA Vipul Sheladiya

Shealdiya & Jyani

Chartered Accountants