Gst Updates For The Month Of October 2018

CIRCULARS

1. NOTIFICATIONS ISSUED UNDER CGST ACT, 2017 REGARGING REFUND TO UIN ENTITIES ARE APPLICABLE TO GST (COMPENSATION TO STATES) ACT, 2017:

Section 55 of CGST Act, 2017 prescribes for refund of taxes paid by specified International Organizations, Foreign Diplomatic Missions or Consular Posts etc on notified supply of goods or services received by them subject to such conditions as may be prescribed. In this regard, Notification No. 16/2017--Central Tax (Rate) dated 28.06.2017 has been issued. A question was raised whether such entities can claim refund of the Compensation Cess paid on goods or services received by them. It was clarified that vide section 11 of Compensation Cess Act, 2017 that the provisions of CGST Act and SGST Act are applicable in relation to levy and collection of Compensation Cess. Therefore, the notifications issued under CGST Act except those prescribing rates or granting exemptions, are applicable for the purpose of the Compensation Cess Act. Accordingly, the said entities are eligible to claim refund of Compensation Cess also if any paid-on goods or services received by them.

{CIRCULAR NO. 68/42/2018 – GST DATED 05.10.2018}

Read more: SBS i 13th Edition

GST UPDATES FOR THE MONTH OF OCTOBER 2018— BULLETIN III

1. EXPANSION OF THE LIST OF HANDICRAFTED GOODS TO GRANT EXEMPTION TO CASUAL TAXABLE PERSON FROM THE REQUIREMENT OF REGISTRATION:

Notification 32/2017-Central Tax read with Notification 8/2017-Integrated Tax grants exemption from the requirement of registration to a casual taxable person engaged in supply of handcrafted goods provided that the aggregate turnover does not exceed twenty lakh rupees. These notifications are now superseded by the below mentioned notifications, which expands the list of handcrafted goods to allow the casual taxable persons dealing with such goods also to claim this benefit. The expanded list of handcrafted goods includes handbags, pouches, purses including jewellery box, wooden frames of painting, photographs, mirrors bangles, beads and small ware, ornamental framed mirrors, glass statutes etc.

{NOTIFICATION NO. 56/2018-CENTRAL TAX & NOTIFICATION NO. 3/2018-INTEGRATED TAX DATED 23.10.2018}

Read more: SBS "i" 12th Edition

The short question that is tried to be answered in this note is ‘whether the provisions of Section 44ADA shall be applicable to the remuneration and other receipts by a partner from a professional services firm? 

Before going into specifics, it is important to understand the modus operandi of the partner and professional services firm and the provisions of Section 44ADA in light of such modus operandi. 

Read more: Applicability of Section 44ADA to Partner’s Remuneration

RATIONALISING THE RESTRICTIONS TO CLAIM REFUND OF IGST PAID ON EXPORTS WHEN GOODS ARE IMPORTED UNDER EOU OR EPCG SCHEME:

Rule 96 of CGST Rules, 2017 prescribes for refund of IGST paid on export of goods. Sub-rule (10) of the said rule prescribed a condition that the exporter of goods should not have procured the goods from a supplier who is availing deemed export benefit or procuring goods at a concessional rate of 0.1% as applicable to a merchant exporter or importing goods under EOU or EPCG scheme. In such cases, the Exporter must compulsorily export the goods under bond or LUT and can claim refund of accumulated ITC on actual basis to the extent of inputs used for exports under Rule 89(4B). Vide Circular No. 45/19/2018-GST dated 30.05.2018, it has been clarified by CBIC that the said restriction is only applicable to those exporters who are receiving goods from those suppliers availing the above said benefits. The restriction is not applicable to exporters who are directly importing the goods under EOU or EPCG scheme. Notification 39/2018-Central Tax dated 04.09.2018 has been issued to apply the said restriction retrospectively to exporter of goods who are importing the goods directly on their own under EOU or EPCG scheme.

Read more: SBS "i" 11th Edition