CA- INTERMEDIATE...CA- INTERMEDIATE GST AMENDMENTS applicable for May 2021 ATTEMPT By :- CA SANCHIT...

CA- INTERMEDIATE

GST AMENDMENTS

applicable for

May 2021 ATTEMPT

By :- CA SANCHIT GROVER

(Only faculty with more than 4.5 years

of experience in tax consultancy at Big 4)

CA INTER

CA. SAHIL GROVER

Video lectures & Study Material

Corporate Laws & Other Laws

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Amendments related to Goods & Services Tax For May 21 CA Inter exams

CA SANCHIT GROVER (Insta ID:- Sanchit.Grover.372) Page 1

Note for my Dear Students – CA Sanchit Grover

These notes are useful for Students who are using 4th Edition of our GST book (Blue and

Orange color book). 4th Edition of the book contains only the amendments up to 31st October

2019. Besides, separate amendment notes were provided for amendments during 1st Nov 2019 to

30th April 2020. The link for those notes and related amendment video is as under:-

Link for GST amendments upto 30th April 2020 for Nov 20 exams

Part A of amendment video:-

https://www.youtube.com/watch?v=lDxBtp3gUVs&t=5640s

Part B of amendment video:-

https://www.youtube.com/watch?v=vZSohRdMGuo&t=8451s

GST Amendment Booklet for Nov 20 exams:-

https://drive.google.com/file/d/1CwjNtTr9Vq2HMDQUG4FApRoSOJf9e9H9/view?usp=sharing

This amendment booklet shall be a complete reference for CA Inter students in respect of all

amendments during 1st May 2020 to 31st October 2020 that are relevant for May 2021

examinations of CA Intermediate and IPCC

Separate amendment video has been uploaded on our YouTube channel “CA Knowledge Portal”

discussing these amendments in detail. The link to this amendment video has also been sent to

virtual classes students. All Students are advised to refer to this video lecture while studying

these notes for conceptual clarity

Although 11 amendments have been covered in this booklet, but all these amendments do not

carry equal importance level. Certain amendments that are very important from examination

purpose, have been highlighted in the Index section. Students are advised to study those

amendments in great detail for May 2021 exams.

There may be cases where a provision of law has undergone multiple amendments during 1st May

2020 to 31st October 2020. In such case, as per ICAI guidelines the law prevailing on 31st

October 2020 (after all such amendments) shall be applicable for exam purpose. This point has

been ensured while drafting this amendment booklet

The author would like to acknowledge that since these notes are primarily meant for CA

Intermediate and CA-IPCC Students preparing for May 2021 examination, we have borrowed

certain illustrations and interpretations from latest ICAI Study Material. Revision Test Paper

(RTP) relevant for May 21 exams was not released yet by ICAI at the time of preparation of this

document. Any questions related to these amendments that are released by ICAI in RTP shall be

discussed separately (Don’t worry, separate video for those will be brought on our YouTube

channel…!!)

In case any reader of these notes has any doubt or need any clarification, you can contact me at

Instagram ID given below. Students who have been taking our live or virtual classes must already

have my whatsapp number for queries purpose.

While we have tried to ensure that these notes remain error free, any inadvertent error that may

have been there in these notes may be brought to the knowledge of the author. Your contribution

to make our notes error free shall be highly acknowledged in the future editions.

https://www.youtube.com/watch?v=lDxBtp3gUVs&t=5640s

https://www.youtube.com/watch?v=vZSohRdMGuo&t=8451s

https://drive.google.com/file/d/1CwjNtTr9Vq2HMDQUG4FApRoSOJf9e9H9/view?usp=sharing



All the Best my dear Students…!!!

Regards,

CA Sanchit Grover



Summary of all Amendments

(for last day revision) Sr.

No.

Summary of the amendment Relevant

Provisio

n

Page

No.

Category A:- Amendments relating to Charge of GST 1. State of J&K bifurcate into 2 separate UTs:- UT of Ladakh without legislature

(to be treated as Union Territory for GST purposes) and UT of Jammu &

Kashmir having its own legislature (to be treated as State for GST purposes)

UT of Dadra & Nagar Haveli and UT of Daman & Diu to be merged and treated

as one single Union Territory (it won’t be having its own legislature, hence it

will be treated as Union territory for GST purposes)

Sec

2(114) of

CGST

Act

7

2. The words “whether or not for consideration” deleted from Entry 4 of Schedule II

to clarify the intention of Law :-

- Firstly check whether any transaction (permanent disposal or putting assets to other

than business use) is without consideration, then it should first satisfy the conditions

of Sec 7(1)(c) r/w Schedule I and

- Only after such transaction becomes ‘supply’, we need to read Entry 4 of Schedule

II to decide whether it is supply of goods or supply of services.

Sec

7(1A)

r/w

Schedule

II

9

3. Taxability of Services provided by director to Company shall be as under:-

If Director is not

employee of

Company

It will be treated as ‘Supply’ under GST and reverse

charge shall be applicable (i.e. Company shall be liable

to pay GST, not the director)

If Director is

employee of the

Company

a) Remuneration paid for services that are under scope of

employment contract and TDS deducted u/s 192 of IT

Act – Not to be treated as supply as per Schedule III of

CGST Act

a) Remuneration paid for services that are outside the

scope of employment contract and TDS deducted u/s

194J of IT Act – Treated as ‘supply’ for GST purposes

and reverse charge applicable

Circular

No.

140/10/2

020 dated

10th June

2020

10

Category B:- Amendments relating to Registration and related procedures 4. Important for exams

Following amendments in the registration procedure w.e.f. 21st August 2020:-

1) Assessee now has option whether he wishes to go for Aadhar authentication

after filing Part-B of GST REG-01 or not (even an individual who is in

possession of valid Aadhar number can choose not to go for aadhar

authentication)

2) In case aadhar authentication is not opted OR it is opted but failed, then

following consequences:-

Physical verification of applicant’s premises by PO before grant of

registration (fixed time limit of 60 days removed now, but since concept of

deemed approval has been re-introduced, it should be implied completed

within 21 days)

Instead of Physical verification, PO can go for verification of such

documents he considers fit (however, if he opts for documents verification,

he has to record reasons in writing and also obtain approval from any

Sec

25(6B)

read with

Rule 8, 9

and 25

12



officer not below the rank of JC)

3) Concept of deemed approval of GST REG-01 if PO fails to take any action within

:-

a) 3 working days (in case aadhar authentication not mandatory u/s 25(6D) OR

aadhar authentication done successfully within 15 days)

b) 21 working days (in case aadhar authentication not opted OR aadhar

Category C:- Amendments relating to Exemptions under GST

5. In case of following two exemptions, the time limit (beyond which they will become

inoperative) has been extended from 30th Sep 2020 to 30th Sep 2021

a) Services by way of transportation of goods by an aircraft from customs station of

clearance in India to a place outside India

b) Services by way of transportation of goods by a vessel from customs station of

clearance in India to a place outside India

NN

13/2017

issued u/s

11 of

CGST

Act

16

6. A new exemption has been brought to provide that Satellite launch services

supplied by the following shall be exempt from tax:-

Indian space research organization (ISRO)

Antrix Corporation Limited

New Space India Limited

NN

13/2017

issued u/s

11 of

CGST

Act

16

Category D:- Amendments relating to ‘Documentation under GST’ 7. Important for exams

Special procedure of e-invoicing (getting unique IRN and QR code on the invoice by

registering details with IRP) mandatory under Rule 48(4) for any registered person,

whose ATO in any preceding FY from FY 2017-18 onwards, is more than 500

Crore, in respect of the following documents:-

a) B2B invoices (i.e. invoices issued to registered recipients)

b) Invoices for export

c) Debit note or credit note u/s 34

Special procedure u/r 48(4) not mandatory for the following:-

Units in Special Economic Zone (only SEZ units, not SEZ developers)

Banking Company or a Financial Institution (including NBFC) or Insurer

GTA engaged in supplying services of transportation of goods by road in a

goods carriage

Suppliers of passenger transportation service

Suppliers of service by way of admission to exhibition of cinematograph

films in multiplex screens

Consequences of not following special e-invoicing procedure:- Invoice issue shall

be treated as invalid (as if no tax invoice u/s 31 has been issued)

Other amendments when E-invoicing procedure u/r 48(4) followed

a) No need to issue tax invoice copies in duplicate or triplicate

b) Tax invoice to mandatorily contain QR code, having embedded IRN, as one

of the particulars prescribed under Rule 46

c) During movement of goods, it is not mandatory to carry physical copy of tax

invoice, instead, QR Code may be produced for verification by PO

Rule

48(4)

16

8. Not relevant for May 21 exam

W.e.f. 1st April 2021, It is mandatory for all registered person to mention HSN on tax

invoice in the manner below:-

Annual Turnover (ATO)

in the preceding FY

Number of Digits of HSN Code

Proviso

to Rule

46

20



ATO ≤ Rs. 5 crores 4 digits in case of B2B invoices

Optional not to mention HSN in case of B2C

invoices

ATO > Rs. 5 crores 6 digits in case of all types of invoices

Category E: - Amendments relating to ‘Payment of tax’ 9. Important for exams

Interest u/s 50 shall be calculated @18% on Net GST Cash liability (i.e. after

adjustment of ITC) in case of late payment of tax (where such supplies have been

declared on self-assessment basis in GST return before initiation of any proceedings

u/s 73 and 74).

In case tax has been paid after initiation of proceedings u/s 73 and 74, Interest u/s 50

shall be calculated on Gross Tax liability (i.e. before adjustment of ITC)

Proviso

to Sec 50

(applicab

le w.e.f.

1st July

2017)

21

Category F: - Amendments relating to ‘Returns under GST’ 10 GSTR-3B shall continue to be filed on monthly basis only but due date of filing

shall be as under:-

In case of registered persons having ATO > 5 Cr.

in preceding FY

20th of next month

In case of registered persons having ATO < 5 Cr.

in preceding FY

22nd or 24th of next

month

In case of a registered person having ATO < 1.5 Cr. in preceding FY or current

FY, GSTR-1 may be filed on quarterly basis – due date of filing shall be 13th

day of month immediately succeeding the relevant quarter In case of registered persons filing GSTR-1 on monthly basis, due date shall be

11th day of immediately succeeding month

Sec 37

and 39 of

CGST

Act

22

11. Following returns/statements can be filed through SMS facility:-

a) Nil GSTR-3B

b) Nil GSTR-1

c) Nil GST CMP-08 (in case of composition dealers)

Nil return/statement means such cases where all tables are Nil or empty

Rule 67A 23



GST

Amendments

in

Detail



GST Amendments for CA Inter & CA IPCC (May 2021)

Amendment No. 1: - Change in the definition of Union Territory – Amendment in Sec 2(114)

Relevant Chapter : Introduction to GST

What we

already know

Earlier, Jammu & Kashmir (including the territory of Ladakh) was a full state with its own

legislature. Article 370 provided that any act passed by Parliament would apply to J&K only

after it is approved by Legislative Assembly of J&K. Accordingly, CGST Act & IGST Act

(passed by Parliament) were ratified by J&K Assembly and SGST Act was also passed by it.

In short, legally J&K was considered at par with any other State of India for the purposes of

GST.

Further, UT of Dadra & Nagar Haveli and UT of Daman & Diu were two separate UTs (both

were without legislature)

Why was there

need for

amendment

The introduction of Jammu & Kashmir Reorganization Act, 2019 has led to the bifurcation of

State of Jammu & Kashmir into two Union Territories namely

the Union Territory of Jammu & Kashmir (to have its own legislature)

the Union Territory of Ladakh (without legislature)

The Re-organization was effective from 31st October 2019.

Further, a new Act was passed namely “The Dadra and Nagar Haveli and Daman and Diu

(Merger of Union Territories) Act, 2019” which has merged these two union territories. The

new UT has become effective from 26th Jan 2020 and will not have any legislature of its own

(just like earlier). The main purpose for doing this was to reduce duplication of services and

reduce the cost of administration.

What is the

amendment

after FA 2020

UT of Jammu & Kashmir will be treated as ‘State’ for GST purpose (since it has

legislature of its own)

UT of Ladakh will be treated as Union territory for GST purpose

UT of Dadra & Nagar Haveli and Daman & Diu will be treated as single Union

Territory for GST purpose

Illustrations to understand the amendment Illustration 1:- Taxes applicable if transaction happening between X Ltd (Supplier) and Y Ltd. (Recipient)

S

No.

Location of

Supplier

Location of

Recipient

Status before amendment Status after amendment

Type of Type of tax Type of Type of tax

Category A: - Amendments relating to Charge of GST

https://taxguru.in/corporate-law/jammu-kashmir-reorganisation-act-2019.html



transaction applicable transaction applicable 1. J&K J&K Intra-State Supply CGST + SGST Intra-State Supply CGST + SGST

2. Ladakh Ladakh Intra-State Supply CGST + SGST Intra-State Supply CGST + UTGST

3. J&K Ladakh Intra-State Supply CGST + SGST Inter-State Supply IGST

4. Ladakh J&K Intra-State Supply CGST + SGST Inter-State Supply IGST

5. Dadra &

Nagar Haveli

Daman &

Diu

Inter-State Supply IGST Intra-State Supply CGST + UTGST

6. Daman &

Diu

Dadra &

Nagar Haveli

Inter-State Supply IGST Intra-State Supply CGST + UTGST

Illustration 2:- Taxes applicable if transaction happening between two branches/establishments of the same

person

S

No.

Location of

Supplier

branch

Location of

Recipient

Status before amendment Status after amendment

Type of

transaction

Type of tax

applicable

Type of

transaction

Type of tax

applicable 1. J&K J&K Not a supply No GST Not a supply No GST

2. Ladakh Ladakh Not a supply No GST Not a supply No GST

3. J&K Ladakh Not a supply No GST Inter-State Supply IGST

4. Ladakh J&K Not a supply No GST Inter-State Supply IGST

5. Dadra &

Nagar Haveli

Daman &

Diu

Inter-State Supply IGST Not a supply No GST

6. Daman &

Diu

Dadra &

Nagar Haveli

Inter-State Supply IGST Not a supply No GST

Illustration No. 3:- Mr. X, a dealer of stationery goods, having branches in Jammu and Ladakh, started his

business operations on 1st May 2020. His aggregate turnover upto 31st December 2020 is 15 lacs only. However,

he made a stock transfer of goods from Jammu branch to Ladakh branch on 1st Jan 2021. Further, certain items

were also sent from Ladakh branch to Jammu branch on the very next day. Mr. X is of the opinion that since his

aggregate turnover is less than 40 lakhs, he is not required to take any registration under GST and pay any tax.

Examine whether his contention is correct or not ?

Ans) Provisions of Law

As per Section 7(1)(c) r/w Schedule I, where any transfer of goods or services happens between deemed distinct

persons in course and furtherance of business, it will be considered as supply even if there is no consideration

involved. Section 25 provides that any branches or establishments of any person, located in different States or

UTs, shall be considered as establishments of different persons.

Further, Section 24 provides that any person making Inter-State supply of goods has to compulsorily take

registration under GST, irrespective of his aggregate turnover.

Conclusion in the present case

After Finance Act 2020, Jammu & Kashmir and Ladakh shall be treated different State and Union territory for

the purposes of GST. Accordingly, branches of Mr. X shall be considered as separate persons in accordance with

Section 25.

Where goods are transferred from Jammu branch to Ladakh branch or vice versa, it will be considered as Inter-

State supply as per Schedule I. Accordingly, by applying provisions of section 24, Mr. X will be required to take

mandatory registration in both J&K and Ladakh (irrespective of the fact that aggregate turnover of Mr. X is less

than 40 lakhs)



Amendment No. 2:- Slight Change in Entry 4 of Schedule II – Sec 7(1A) r/w Schedule II Relevant Chapter : Concept of Supply under GST

What is the

existing

entry in

Schedule II

Sec 7(1A) read with Schedule II doesn’t enlarge the scope of the term ‘supply’. In respect of

transactions/activities that fall within the scope of ‘supply’ as defined in 7(1), Schedule II

merely clarifies whether such transactions would be treated as supply of goods or supply of

services.

Entry 4 of Schedule II used to provide the following:-

Nature of transaction Whether treated as Supply

of goods or services

Goods forming part of business assets are transferred or

disposed off by/under directions of person carrying on the

business so as no longer to form part of those assets,

whether or not for consideration

Supply of goods

Goods held/used for business are put to private use or are

made available to any person for use for any purpose other

than business, by/under directions of person carrying on

the business, whether or not for consideration

Supply of services

What was

the

confusion

Due to the words “whether or not for consideration”, some officers were taking the

interpretation that if some business assets were disposed off without consideration to non-

related persons and ITC is also not claimed on procurement of such business assets, then also

it should be treated as Supply of goods [although this transaction is not falling within the

ambit of Schedule I r/w Sec 7(1)(c)].

However, this was never the intention of legislature. If any transaction is not a supply as per

Section 7(1), then Section 7(1A) r/w Schedule II cannot bring it within ambit of ‘supply’

What is the

amendment

by FA 2020

Finance Act 2020 has deleted the words ‘whether or not for consideration’ retrospectively

with effect from 1st July 2017. This deletion was done primarily to ensure that there is no

scope for confusion in interpretation of Entry 4 of Schedule II.

After deletion of these words, it is now clear that if any transaction (permanent disposal or

putting assets to other than business use) is without consideration, then it should first satisfy

the conditions of Sec 7(1)(c) r/w Schedule I and only after such transaction becomes

‘supply’, we need to read Entry 4 of Schedule II to decide whether it is supply of goods or

supply of services.

Illustrations to understand the impact of this amendment

Activity Whether a Supply or

not

Whether Supply of goods

or services

1) Table in conference room of office sold for Rs.

5,000 (ITC was availed)

Yes - Sec 7(1)(a) Supply of goods - as per

Schedule II

2) Table in conference room given to scrap dealer for

free (ITC was earlier availed)

Yes – Sec 7(1)(c)

read with Schedule I

Supply of goods - as per

Schedule II

3) Motor car was purchased 5 years ago and now

it is given to scrap dealer for free (No ITC was

availed earlier)

No (since ITC was

not availed earlier)

N/A – there is no need to

check Schedule II here

since it is not even supply

Exam Note for Students:- The above amendments made by FA 2020 was notified on 1st Jan 2021, however

since this amendment is retrospective in nature, the same may be applicable for May 2021 exams.



Amendment No. 3:- CBIC Circular regarding taxability of services by directors to

Company/Body Corporate – Circular No. 140/10/2020 – GST (dated 10th June 2020) Relevant Chapter : Concept of Supply under GST and Reverse Charge

What we

already

know

Section 7(2)(a) r/w Schedule III provides that ‘Services by an employee to the employer in the

course of or in relation to his employment’ shall be outside the ambit of ‘supply’.

Further, Notification No. 13/2017 issued u/s 9(3) provides that in case of services supplied by

a director of a company/body corporate to the said company/ body corporate, reverse charge

shall be applicable.

Some

background

knowledge

There are generally two types of directors in any company or body corporate:-

1) Directors who are under employment contract with the company (i.e. where employer-

employee contract exists). These are generally referred to by different names liles Executive

director or whole time director or Managing director.

2) Directors who are not employees of the company. These types of directors are known by

different names like non-executive directors, independent directors etc. They usually receive

sitting fees and commission for their services.

Clarification by CBIC circular regarding Taxability of Services by Directors

Where

Director is

not

employee

of

Company

In respect of such directors, the services provided by them to the Company, in lieu of

remuneration, are clearly outside the scope of Schedule III of CGST Act and are therefore

taxable.

In fact in such cases, reverse charge is applicable i.e. the Company receiving the services is

liable to pay GST to the government

Where

Director is

employee

of the

Company

Basic test to be applied:- Check whether all the activities performed by the director are in

the course of employer-employee relationship (i.e. a “contract of service”) or there is any

element of “contract for service”

How does Income tax law differentiate between above two scenarios

Income tax law also makes a similar differentiation of remuneration received by directors

who are employees of company:-

Salaries paid to directors are subject to TDS u/s 192 of IT Act

In case remuneration paid to directors is in nature of professional fees and not salary,

the same is liable for deduction under Section 194J of IT Act

GST treatment suggested by CBIC circular Case 1:- Part of Director’s

remuneration which is declared as

‘Salaries’ in the books of company and subjected to TDS u/s 192

Not taxable for GST purposes also. Such

amount will be covered under Schedule III since this amount represents consideration for

services by an employee to employer in course of

or in relation to his employment

Case 2:- That part of employee

Director’s remuneration which is

declared separately other than

‘salaries’ in the Company’s accounts

It will be treated as consideration for providing

services which are outside the scope of Schedule

III of CGST Act and hence taxable. Further

reverse charge will be applicable in this case i.e.



and subjected to TDS u/s 194J of IT

Act as fees for Professional or

Technical services

the employer Company shall be liable to pay

GST to government

llustrations to understand the concept

Illustration 1:- Mr. X is working as a director with A Ltd. under employment contract with the company. He

has received the following amounts from the Company:-

Remuneration paid for rendering services under employment contract (TDS was

deducted u/s 192 of Income Tax Act, 1961 by A Ltd)

12,00,000

Remuneration paid for rendering professional services (outside the employment

contract). TDS u/s 194J of Income Tax Act, 1961 deducted on this amount

50,000

Besides Mr. X, A Ltd has also employed an independent director, Mr. Y, who is not engaged in day to day

working of the Company. Mr. Y is paid a sum of Rs. 20,000 as sitting fees for attending Board meetings of the

Company.

A Ltd. has also received professional services of management consultancy from XY Associates, a partnership

firm in which both the directors (Mr. X and Y) are working partners, for which a sum of Rs. 2,00,000 was

paid. Discuss the taxability of each of the above payments made by A Ltd.

Solution:- Taxability of different payments made by A Ltd. shall be as under:-

Type of Payment made Taxability along with reasons

1) Rs. 12,00,000 paid to Mr.

X (director who is also

employee of the

company)

In this case, since consideration is paid for services rendered by employee

in course of employment, it will be outside ambit of ‘supply’ in accordance

with Schedule III of CGST. Accordingly, there shall be no levy of GST in

this case

2) Rs. 50,000 paid to Mr. X

for a separate contract for

professional services

In this case, consideration is paid to employee director for services that are

outside the scope of his employment contract (this is evident by the fact

that company has deducted TDS u/s 194J for purposes of Income Tax Act).

Accordingly, schedule III shall not be applicable here. Hence, these

services shall be subjected to tax under reverse charge i.e. A Ltd. shall be

liable to pay GST on Rs. 50,000

3) Sitting fees of Rs. 20,000

paid to Mr. Y, a independent

director

Since this amount is paid to a director, who is not employee of the

company, there shall be no applicability of Schedule III in this case. GST

shall be payable on Rs. 20,000 under reverse charge i.e. A Ltd. shall be

Taxability of Services by director [CBIC circular]

Director is Employee of

Company

Director is not Employee

of Company – TDS u/s

194J

Salary for services in

course of employment

– TDS deducted u/s

192

Salary for services not

in course of

employment – TDS

deducted u/s 194J

Not Supply as per

Sch III

Treated as Supply – tax payable

under RCM by Body Corporate



liable.

4) Rs. 2,00,000 paid as

management consultancy

charges to XY associates

In this case, professional services are rendered by XY Associates, a

partnership firm. These services shall be subjected to GST under forward

charge i.e. XY Associates shall be liable to pay GST. The fact that both the

partners of XY Associates are also directors of A Ltd. would not make any

difference to the taxability of these services.

Category B: - Amendments relating to Registration and related procedures

Amendment No. 4:- Change in the manner of Aadhar based authentication New GST

registrations – Sec 25(6B) read with Rule 8, Rule 9 and Rule 25

Relevant Chapter ;- Registration under GST

What we

already

know

FA 2019 brought in Sec 25(6A) and Sec 25(6B) to provide for aadhar authentication for

existing GSTIN holders as well as persons applying for fresh registration under GST.

Case 1:-

In case of

Existing

registered

persons

holding

GSTIN

Sec 25(6A) provided that every registered person shall undergo

authentication or furnish proof of possession of Aadhar number, in such

form and manner and within such time as may be prescribed. In case Aadhar

is not assigned to such registered person, such person shall be offered

alternate and viable means of identification in such manner as Gov. may,

on the recommendation of GST Council, prescribed.

In case of failure to comply with the above, Registration allotted to such

person shall be deemed to be invalid and all Other provisions of the Act

shall apply as if such person does not have registration

Case 2:-

In case of

persons

applying

for fresh

registratio

n

Sec 25(6B) read with Rule 8 provide that every individual, shall undergo

authentication of Aadhar number while filing application in REG-01 (it is

done post submission of Part-B of application).

As per sec 25(6B) read with notification issued u/ 25(6D), in case of any

person, other than individual, aadhar authentication shall be required in

respect of the following persons:-

a) Karta of HUF

b) Managing and Authorized partners of a partnership firm

c) Authorized signatories of all types

Further, notification u/s 25(6D) also provides that any person who is not

Indian citizen is not required to get aadhar authentication

Consequences if Aadhar is not assigned to persons specified above in Case 2

In this case, registration shall be granted (i.e. REG-06 issued) only after physical

verification of the principal place of business is conducted in following manner:-

Physical verification shall be done by Proper Officer in presence of person seeking

registration (i.e. applicant)

It shall be conducted within 60 days from date of application (REG-01)

Verification report along with other documents (including photographs) shall be

uploaded in form GST REG-30 on the common portal within 15 days from date of

such verification.

Concept of deemed approval of REG-01 if no reply received within 3 working days

from submission of application, shall not apply in the above case

CA INTER


GROUP-1 A

VJ

AC

AD

EM

Y

₹ 29,250/- ₹ 30,750/-

CA INTER


BOTH GROUPS BOTH GROUPS AV

J

AC

AD

EM

Y

₹ 51,000/-

Mob. 9310824912/9310824712

₹ 54,000/-

CA INTER


GROUP-2 A

VJ

AC

AD

EM

Y

₹ 25,500/- ₹ 27,000/-



Amendment

No 1:-

Option to

choose ‘No’

while opting

for Aadhar

authenticatio

n

As per new procedure introduced w.e.f. 21st Aug 2020, applicant will have to choose whether

he wishes to undergo aadhar authentication or not (in case he choose not to, then additional

steps for physical verification have to be done – discussed in next column)

Situation 1:- What is the procedure if Aadhar authentication opted Once the applicant chooses ‘Yes’, then aadhar authentication is done in following manner:-

GST system sends "authentication link" to the concerned persons at their GST

registered mobile numbers and email ids mentioned in the GST REG-01, for the

aadhaar authentication.

Upon clicking authentication link, a screen will come with a declaration where the

applicant needs to enter an Aadhar number and click on ‘validate’

Scenario 1:- Aadhar authentication is done successfully

a) On successful matching of the details GST REG-01 with UIDAI (unique

Identification Authority of India), an OTP will be sent on their email and mobile

registered with the Aadhar.

b) Once OTP is entered in the box provided in the screen, validation will be complete

and a message of successful e-KYC authentication will be shown

Scenario 2:- Failure of Aadhar authentication

While going through above procedure, it is possible that authentication may fail due to

following possible reasons:-

Mobile number may not be updated in records of UIDAI

Details entered in REG-01 mismatch with details in UIDAI records

Any technical issue while matching process

In case of failure to authenticate Awadhi details, GSTIN would be allotted to applicant only

after physical verification (or alternatively verification of necessary documents) is carried out

by proper Officer (PO)

Which date would be considered as ‘Date of Submission’ of GST REG-01

Scenario 1:- Where aadhar authentication is

successfully done within 15 days from submission of

Part-B of GST REG-01

Date of Aadhar authentication

Scenario 2:- Where Aadhar authentication is failed

within 15 days from submission of Part-B of GST

REG-01

15th day from submission of Part-

B of GST REG-01

Situation 2:- What is the procedure if Aadhar authentication is not opted while

filling GST REG-01

As per new procedure introduced w.e.f. 21st Aug 2020, applicant has option to choose ‘No’

for aadhar authentication after filing Part-B of GST REG-01. In such case, GST REG-01

shall be considered as filed on the date when Part-B of GST REG-01 is submitted.

However, in such case also, GSTIN would be allotted to applicant only after physical

verification (or alternatively verification of necessary documents) is carried out by proper

Officer (PO)

This option is generally opted by following types of applicants:-

Applicant who doesn’t possess Aadhar and is also not willing to obtain Aadhar

merely for getting GST registration

Applicant who possesses Aadhar but doesn’t want to go for Aadhar authentication

(for whatever reason..!!)

What are the consequences if Aadhar authentication is not successfully done

Where a person (other than individual who is not Indian citizen),



- Fails to undergo Aadhar authentication in the manner prescribed

- Does not opt for authentication of Aadhar number

GST registration shall be granted only after physical verification of the place of business in the presence of

said person. (there is no fixed time limit prescribed but due to provisions of deemed registration, it is implied

that such process should be completed within 21 days from date of filing REG-01)

Once physical verification is over, the verification report (along with photographs & other documents) shall be

uploaded in form GST REG-30 on the common portal within a period of 15 days following such verification

Alternative to Physical Verification of Place of Business

Rule 9 provides that if PO may, in lieu of physical verification of place of business, carry out the verification

of such documents as he may deem fit. But if he wishes to go for Documents verification (instead of physical

verification of premises), he has to satisfy following conditions:-

- He has to record reasons in writing why he has chosen documents verification instead of physical

verification of premises

- He has to obtain approval of an officer not below the rank of Joint Commissioner

Amendment

No. 2:-

Concept of

Deemed

approval of

REG-01 re-

introduced

Examination of documents & information by PO Once application in GST REG-01 is filed, it is forwarded to PO who shall examine the

application and accompanying documents. There can be two cases here:-

Case 1:- If PO has no objections or needs no additional clarifications

If PO finds all information & documents in order, he shall approve the application and grant

registration certificate in form GST REG-06 within the prescribed time period (3 days or 21

days)

Case 2:- If PO has certain objections or needs additional clarifications

PO shall issue Show cause notice (SCN) in form GST REG-3 within the prescribed time

period (3 days or 21 days) in any of the following 2 situations:-

Where application submitted is found to be deficient, either in terms of any

information or any document required

Where PO requires any further clarification with regard to any information or

document

Prescribed time limit to issue REG-06 or to issue SCN in REG-03

a) In case aadhar authentication is done successfully

within 15 days of filling Part-B of GST REG-01 or

b) where aadhar authentication is not applicable

(individual who is not Indian citizen)

3 working days from

Date of submission of

GST REG-01

a) In case person doesn’t opt for Aadhar authentication

b) Where person fails to authenticate aadhar within 15

days of filing Part-B of filing GST REG-01

21 working days from

Date of submission of

GST REG-01

If no action is taken by PO in above prescribed time limit, registration application shall be

deemed to have been approved and applicant shall be granted GSTIN at expiry of

3days/21days



Summary of above Aadhar authentication (AA) procedure in Tabular Form

Whether AA

opted while

filing GST REG-

01

Whether AA

was completed

within 15 days

from filing Part-

B

What will be

considered as ‘Date of

Submission of GST

REG-01’

Within how many

days ‘Deemed

registration’

provisions will apply

Mr. A (not a

citizen of

India)

AA not

applicable in his

case

N/A Date on which Part-B is

filled

3 working days

Mr. B

(Indian

Citizen)

No N/A Date on which Part-B is

filled

21 working days

Mr. C

(Indian

Citizen)

Yes No 15th day from

submission of Part-B

21 working days

Mr. D

(Indian

Citizen)

Yes Yes Date of completion of

AA

3 working days

Summary of the amendments in Registration procedure Basis of

differentiation

Pre – Amendment (i.e.

between 1st April 2020 to

20th Aug 2020)

Post Amendment (i.e. w.e.f. 21st August 2020)

When will

alternative

means be

applicable

If the applicant does not have

Aadhar

2 Situations:-

a) Applicant has not opted for Aadhar authentication

process or

b) Applicant opted for Aadhar authentication process but

it could not be completed within 15 days

What are the

prescribed

alternative

means

Only one method was

prescribed:- Compulsory

physical verification of the

place of business of applicant

before granting registration

(has to be completed within

60 days of submission of

registration application)

Instead of 1, now 2 methods have been prescribed:-

1) Physical verification of place of business of applicant

before granting registration

(no time limit has been prescribed now, but since

concept of deemed approval applies if no action taken by

PO within 21 days, so such time limit is implied for

completion of physical verification also)

2) Instead of physical verification, PO can go for

verification of such documents as he considers fit

(however, if he opts for documents verification, he has to

record reasons in writing and also obtain approval from

any officer not below the rank of JC)

Concept of

deemed

approval

Concept of deemed approval

was made inapplicable in

cases where aadhar

authentication was mandatory

Concept of deemed approval shall be applicable even in

cases where aadhar authentication required – time limit

shall be 3 days or 21 days depending on the situation

(explained in table above)

Process of obtaining registration under GST – Section 25 + Rule 8 & 9

Within a period of 30 days

Person becomes liable for

registration u/s 22 or 24

5 days prior to commencement of business (in case of CTP)

Whether Aadhar authentication

(‘AA’) is required u/s 25 ?

No, if Person is notified u/s 25(6D)

– Person not Indian Citizen

Date of Submission of REG-

01 = Date of filling Part-B

above

Yes, if Person is not notified u/s

25(6D)

Person Opts for AA Person doesn’t Opt

for AA

AA done successfully within 15

days from filing Part-B

AA not completed within

15 days of filing Part-B Date of Submission of REG-01

= Date of filling Part-B above

Date of Submission of REG-01 =

Date of AA

Date of Submission of REG-01

= 15th Day from filing Part-B

above

Separate application

in each State

PO to conduct Physical verification of place of

business (In lieu of this Original Documentation

verification can also be done by PO after

recording reasons in writing and taking

permission from senior officer not below JC level

Apply for

registration

in Form GST

REG-01

Fill Part-A of GST REG-01 by filling follow. details:-

a) Mobile No. – validated using OTP

b) Email ID - validated using OTP

c) PAN – validated from CBDT database

d) State/UT in which registration sought

Temporary

Reference

Number (TRN)

communicated on

Phone and e-mail

Submit Part-B of GST REG-01

with ‘Specified information

and documents’ + Advance

Deposit in case of CTP

a) If Information is not in Order OR

b) PO requires additional

information/clarification

PO to issue SCN in GST REG-03 within

21 days from submission of REG-01

PO to grant GST REG-06

within 21 days from

Submission of REG-01

PO finds the reply

satisfactory

Verification report in

GST REG-30 (along

with photos) to be

uploaded within 15

days from date of

physical verification

PO to examine Application &

documents in next 21 days from Date

of Submission of REG-01 and take

either of 2 Steps (If no action taken,

then Deemed registration)

All Information is in order +

No further Clarification

required by PO

Applicant doesn’t reply in GST REG-04

within 7 days from receipt of REG-03

Reject the application and

issue GST REG- 05 within

next 7 days

Applicant replies in GST REG-04


PO doesn’t find the

reply satisfactory

PO doesn’t take

any action in 7 days

PO to examine Application & documents in

next 3 days from Date of Submission of

REG-01 and take either of 2 Steps (If no

action taken, then Deemed registration)

PO to grant GST REG-06

within next 7 days

All Information is in order + No

further Clarification required by PO

a) If Information is not in Order OR

b) PO requires additional

information/clarification

PO to grant GST REG-06 within 3

days from Submission of REG-01 PO to issue SCN in GST REG-03 within 3

days from submission of REG-01

Applicant doesn’t reply in GST REG-04

within 7 days from receipt of REG-03 Applicant replies in GST REG-04


Reject the application and

issue GST REG- 05 within

next 7 days

PO finds the reply

satisfactory

PO doesn’t find the

reply satisfactory

Deemed

registration

to Applicant

PO doesn’t take

any action in 7 days

PO to grant GST REG-06 within next 7 days

Reasons for rejection to

be mentioned in REG-05

AA required for individual, or Karta

of HUF or Managing partner or

Authorized signatory

Prepared by:- CA Sanchit Grover (AVJ Academy)

Prepared by:- CA Sanchit Grover



Category C:- Amendments relating to Exemptions under GST

Amendment No. 5:- Extension of time limit for 2 exemptions related to transportation services Relevant Chapter ;- Exemptions under GST

Which are the exemptions What is the amendment brought

a) Services by way of transportation of goods by an aircraft

from customs station of clearance in India to a place outside

India

b) Services by way of transportation of goods by a vessel from

customs station of clearance in India to a place outside India

Both these exemptions were applicable till

30th September 2020 (after such date they

were to be made ineffective).

Now this date has been extended to 30th

September 2021

Amendment No. 6:- New Exemption brought for Satellite Launch Services Relevant Chapter ;- Exemptions under GST

What is the

new

exemption

entry

Satellite launch services supplied by the following shall be exempt from tax:-

Indian space research organization (ISRO)

Antrix Corporation Limited

New Space India Limited

Category D:- Amendments relating to Documentation and E-Waybill under GST

Amendment No. 7:- Requirement of issuing e-invoice w.e.f. 1st October for selected taxpayers– Rule 48(4) of CGST Rules

Relevant Chapter;- Documentation under GST

What we

already

know

- Currently under GST law, every registered supplier making taxable supplies of goods has

to issue invoice (containing the particulars prescribed under Rule 46) in triplicate.

Similarly, suppliers of taxable services have to issue invoice in duplicate (containing the

particulars prescribed in Rule 46)

- These invoices may be signed manually or digitally signed. Further, if the invoice has

been issued electronically in accordance with the provisions of Information Technology

Act, then there is no need for any type of signature

Introduction

of concept of

e-invoicing

under GST

Rule 48 provides that there shall be certain notified class of registered taxpayers who shall

issue invoice in prescribed format GST INV-01 after obtaining Invoice Reference number by

uploading information on Common Goods and Services Tax Electronic Portal (known as

IRP or Invoice registration portal in common language) in the prescribed manner.

What is the meaning of E-invoicing:- E-invoice doesn’t mean now invoices shall be

generated through GST portal. Invoices will be generated by accounting software/ERPs of

taxpayers but additional requirement is that specified particulars of invoice in form GST INV-

01 will have to be uploaded by taxpayer in specified format (JSON format) on notified

Invoice Registration Portals (IRPs) and thereafter a unique Invoice reference number (IRN)

shall be assigned to each invoice.

This IRN, allotted by e-invoice system, will be a unique 64 character number and hence there

will be unique identity for each invoice for the entire FY in the entire GST system for a

particular taxpayer

Who has Any registered person, whose aggregate turnover in any preceding FY from FY 2017-18



been notified

under Rule

48(4)

onwards, exceeds 500 Crore, is required to issue e-invoice as per the prescribed procedure

Exceptions:- Following category of persons do not have to follow this method (even if their

ATO exceeds 500 cr.):-

Units in Special Economic Zone (only SEZ units, not SEZ developers)

Banking Company or a Financial Institution (including NBFC) or Insurer

GTA engaged in supplying services of transportation of goods by road in a goods

carriage

Suppliers of passenger transportation service

Suppliers of service by way of admission to exhibition of cinematograph films in

multiplex screens

What type of

documents

need to be

issued as per

new method

Invoices issued to registered customers (i.e. E-invoicing not required for B2C

supplies)

Invoice issued for export of goods or services

Debit note and Credit note issued as per Sec 34

Interesting fact:- Although practically word ‘e-invoicing’ is being used to refer to this new

system, but actually apart from B2B & export invoices, debit notes and credit notes also have

to be issued as per new system only

Process of

generating

E-invoices

E-invoice shall be generated using the following procedure:-

a) A taxpayer shall generate an invoice using his own ERP or accounting/billing software.

This invoice will be serially numbered (maximum 16 digits) and would contain all

particulars as prescribed under Rule 46.

b) Thereafter, he will upload the prescribed details of that invoice on Common GST

Electronic portal in JSON (Government has notified 10 websites managed by GSTIN,

commonly referred to as Invoice registration portal or IRP). These prescribed details

have been given in format GST INV-01 (apart from Rule 46 particulars, some extra

particulars, mainly optional fields, can also be filled)

c) This JSON file can be generated using offline utility tool (provided by IRP) and also by

online tools (Direct API with supplier’s system or GSP based) for bulk generation of e-

invoices.

d) Based on the information uploaded on IRP, after certain validation checks, an Invoice

reference number (IRN) will be generated by portal. Portal will add its own signature

and QR Code to the Invoice. This QR code will contain all important details on the

invoice which can be verified by any person using a mobile app.

e) E-invoice containing the IRN, QR Code and signature provided by IRP shall be returned

to supplier in JSON format. This invoice can be converted to pdf format and also printed

by supplier, before being shared with the recipient. IRP will not directly share the e-

invoice with the recipient.

f) Additionally, IRP shall forward details of this invoice to GST portal [gst.gov.in] based

on which GSTR-1 details of the supplier can be auto-populated. Further, IRP shall also

forward details of E-invoice to EWB portal [ewaybill.nic.in] to allow automatic fetching

of information in EWB

Further, once the above procedure is followed, notified taxpayers do not have to issue

duplicate or triplicate invoices (in case of goods and services respectively)

What if new

e-invoicing

system is not

followed

In case of notified Taxpayers, invoice has to be mandatorily issued through above procedure,

otherwise it shall not be considered to be a valid GST Invoice (in other words, all

consequences will follow as if no tax invoice was issued for such transaction).

Impact of this point Date on which

invoice generated

by Supplier

Date on which IRN

allotted by IRP

Consequences



31-03-2021 02-04-2021 Invoice will be considered as valid tax invoice

from 2nd April 2021 only

Movement of goods shall commence only after

2nd April 2021 & Time of supply of supplier

shall also be determined based on this date

Recipient cannot claim ITC before 2nd April

2021

31-03-2021 No IRN allotted Invoice will not be treated as valid tax invoice

In case movement of goods is done, goods are

liable for confiscation, further supplier shall

also be liable for penalty u/s 122

Recipient will not be able to avail ITC (since

any invoice not containing IRN shall not be

treated as valid invoice)

Advantages

of E-

invoicing

concept

Advantages of E-invoicing for taxpayers

1) Reduction of time due to auto-generation of GSTR-1 and EWB

Once data pertaining to each invoice is uploaded on IRP for generation of IRN, IRP will

automatically share the data with GST Common portal for auto-updation of details in GSTR-1

of Supplier and GSTR-2A of recipient. Similarly, IRP will also share the data with E-waybill

portal and help in generation of EWB.

2) Reduction in transcript errors

Since same details uploaded by supplier are automatically fetched by system in GSTR-1 and

EWB, it will ensure that there are no errors due to clerical mistakes while manually entering

information in GSTR-1 and EWB. This will substantially reduce mismatches between

information reported by supplier in GSTR-1 and information reported by recipient in his

GSTR-3B (leading to lesser disputes and business efficiency)

Advantages of E-Invoicing for GST Authorities

1) Real-time reporting of transaction by suppliers

Concept of e-invoicing will ensure that supplier provides all the details of his transaction to

IRP on real time basis. Once this information is provided to IRP, then there are almost no

chances of making any fraudulent changes or adjustments afterwards. Further, this will also

tackle the menace of fake invoicing

2) Ease in checking of goods while in transit

While the goods are being transported, if GST officers wish to physically check the goods vis-

à-vis the details shared in invoice, they can easily do so by scanning QR code using offline

tools (like mobile app). This will ensure better tax administration (Earlier tax officers had no

mechanism to ensure that invoice being accompanied with the goods is actually genuine

invoice or not)

Applicability

of E-

invoicing

concept on

certain

transactions

CBIC has clarified about applicability of E-invoicing concept on the following transactions:-

Supplies made by a registered supplier (having ATO > 500

Cr.) to unregistered customers (B2C supplies)

E-invoicing not applicable


Cr.) that are notified under reverse charge u/s 9(3)

E-Invoicing applicable

Supplies received from unregistered suppliers by a

registered recipient (having ATO > 500 Cr.) notified under

reverse charge u/s 9(3) or 9(4) – self invoicing required by

recipient u/s 31(3)

E-Invoicing not applicable


Cr.) located in DTA to any SEZ Unit

E-Invoicing applicable

Illustrations relating to E-invoicing concept



Illustration 1:- Genpact Ltd. has 2 units in the State of Haryana:- one unit in DTA and another in SEZ. The

details of turnover of these units during FY 2019-20 is as under:-

Value of supplies by DTA unit to registered customers 150 Crore

Value of supplies by DTA unit to unregistered customers 200 Crore

Value of supplies by SEZ unit to registered customers 120 Crore

Value of supplies by SEZ unit to unregistered customers 180 Crore

Total ATO of Genpact Ltd. 650 Crore

Since aggregate turnover of Genpact Ltd. is more than 500 crore in FY 2019-20, concept of e-invoicing shall

become applicable w.e.f. 1st October 2020.

During the month of October 2020, Genpact Ltd. made following supplies:-

Type of supply Amount of

supply

Whether E-

invoicing applicable

a) Supplies by DTA unit to registered customers in DTA 5,00,000 Yes

b) Supplies by DTA unit to unregistered customers in DTA 12,00,000 No

c) Exports made by DTA unit 4,00,000 Yes

d) Supplies by SEZ unit to registered customers in DTA 10,00,000 No

e) Supplies by SEZ unit to unregistered customers in DTA 8,00,000 No

f) Exports made by SEZ unit 3,00,000 No

g) Supplies made by DTA unit to SEZ unit (Stock transfer) 15,00,000 Yes

h) Supplies made by SEZ unit to DTA unit (Stock transfer) 6,00,000 No

Illustration 2:- EY India Pvt. Ltd. is a registered supplier in Haryana engaged in supply of professional

services. Its aggregate turnover during the last 3 FYs is as under:-

Relevant Period Amount of aggregate turnover

FY 2017-18 350 Crore

FY 2018-19 540 Crore

FY 2019-20 420 Crore

FY 2020-21 upto 30th Sep 2020 180 Crore

Whether E-Invoicing will be mandatory for EY India w.e.f. 1st October 2020

Solution:- As per Rule 48(4), e-invoicing shall be mandatory for any registered person having aggregate

turnover exceeding 500 crore in any preceding financial year from FY 2017-18 onwards. In the given case,

since ATO is more than 500 crore in FY 2018-19, E-invoicing shall be mandatory w.e.f. 1st October 2020.

Illustration 3:- Raina Legal Associates is a firm of advocates having aggregate turnover of 600 crore in FY

2019-20. It is registered under GST. It has supplied legal consultancy services to X Ltd. during Nov 2020 for

Rs. 5,00,000. Aggregate turnover of X Ltd. during FY 2019-20 is 750 crore. Raina Legal is of the view that

although it is registered under GST but it is not required to pay any GST on Rs. 5,00,000 services to X Ltd.

Further, e-invoicing under Rule 48(4) is also not applicable on it. It has advised X Ltd that X Ltd should raise

E-invoice as well as discharge GST on legal services under reverse charge. Is this advice correct

Solution:- The advice given by Raina Legal is partially correct and partially incorrect. In the given case, legal

services provided by firm of advocates to X Ltd. shall be covered under reverse change u/s 9(3) and hence X

Ltd. shall be liable to pay GST.

However, since Raina Legal is registered under GST, it shall be liable to issue tax invoice u/s 31. Further,

since aggregate turnover of Raina Legal is more than 500 crore in FY 2019-20, e-invoicing under rule 48(4)

shall be mandatory for Raina Legal. No invoice is required to be issued by X Ltd. (since reverse charge

supplies haven’t been procured from unregistered supplier)



Other Amendments w.e.f. 1st October 2020 relating to E-Invoicing Due to introduction of E-Invoicing concept under Rule 48(4), there were certain other consequential

amendments done in other rules as well:-

Relevant Provision What is the amendment

1) Rule 48(1) prescribes that in case of supply of goods, tax

invoice has to be prepared in Triplicate, whereas Rule 48(2)

prescribes that in case of supply of services, tax invoice has

to be prepared in Duplicate.

Rule 48(6) has clarified that where invoice has

been issued in manner prescribed u/r 48(4) [in

other words, where e-invoicing is mandatory],

there shall be no need to issue invoice copies in

duplicate/triplicate

2) Rule 46 prescribes various particulars that are

mandatorily required to be stated on tax invoice. Some of

these are GSTIN of supplier, GSTIN of recipient,

description of goods, HSN code, Taxable value, rate of tax,

amount of tax, signature etc.

In respect of invoices that are issued in manner

prescribed under Rule 48(4), one more

mandatory particular should be there on

invoice:-

“Quick Response code, having embedded

Invoice Reference Number (IRN) in it”

3) Rule 138-A prescribes following mandatory documents

that are required to be carried by person-in-charge of a

conveyance during movement of goods:-

Invoice of Bill of Supply (in case where movement

is for Supply)

Delivery Challan (in case where movement is for

reasons other than Supply)

Bill of Entry (in case where movement is of

Imported goods)

Besides the above documents, EWB (in physical form or e-

form) shall also be accompanied with the goods

Rule 138A(2) amended to provide that in cases

where invoice is issued in manner prescribed

under Rule 48(4), then the Quick Response

Code (QR Code) having embedded Invoice

Reference number (IRN) in it, may be

produced electronically for verification by

Proper Officer, in lieu of the physical copy of

such tax invoice.



Amendment No. 8:- Requirement to specify HSN on tax invoice mandatory for all Class of

Taxpayers now– Amendment not applicable for May 21 Students, but just for knowledge

Relevant Chapter ;- Documentation under GST

What is the

existing

provision

In accordance with proviso to Rule 46 read with Notification No. 12/2017, Taxpayers have

to mention only few digits of HSN on tax invoice, based on what is their turnover

Annual Turnover (AT) in the preceding FY Number of Digits of HSN Code

ATO ≤ Rs.1.5 crores Nil

Rs. 5 crores ≥ ATO > Rs.1.5 crores 2

ATO > Rs. 5 crores 4

However, in case of Importers/Exporters, HSN of 8 digits was mandatory (so ensure that

they are compatible with global standards)

What is the

amendment

New Notification 78/2020 has been issued under first proviso to Rule 46, that has mandated

all taxpayers to compulsorily mention HSN on tax invoice in the manner below:-

Annual Turnover (AT) in the

preceding FY

Number of Digits of HSN Code

ATO ≤ Rs. 5 crores 4 digits in case of B2B invoices

Optional not to mention HSN in case of B2C

invoices

ATO > Rs. 5 crores 6 digits in case of all types of invoices

Illustrations from ICAI Study Material

The turnovers of Yellow Lemon Pvt. Ltd., Red Pepper Pvt. Ltd. and Blue Berry Pvt. Ltd. in

the previous financial year are Rs. 1.5 crore, Rs. 4.8 crore and Rs. 6 crore respectively.

While Yellow Lemon Pvt. Ltd. and Red Pepper Pvt. Ltd. will be required to upload 4 digits

of HSN code of the goods sold to registered persons, uploading of 4 digits HSN code will be

optional for the two companies when the goods are sold to unregistered persons. Blue Berry

Pvt. Ltd. will have to upload 6 digits of HSN code of goods sold by it.

Whether this

amendments

would apply

for May 21

The above amendment has been made effective from 1st April 2021. Accordingly, ICAI

Study Material has clarified that this amendment shall not be applicable for Students of May

2021 attempt.

This amendment has been discussed here only for knowledge purposes

Category E:- Amendments relating to Chapter of ‘Payment of tax’

Amendment No. 9:- Interest to be calculated on Net Cash Tax Liability (not Gross Tax

Liability) in case of delayed payment of self assessed liability– Proviso to Section 50

Relevant Chapter : Payment of tax under GST

What we

already

know

I) Circumstances in which Interest is payable as per Sec 50

Interest is payable in following 3 circumstances:-

Case 1:- Where a person is liable to pay tax but fails to pay it (in full or in part) to the

Government within the prescribed time

Case 2:- Undue or excess claim of input tax credit under section 42(10)

Case 3:- Undue or excess reduction in output tax liability under section 43(10)

Practically since the procedure of ITC reconciliation is not effective, Case 2 & Case 3 are

redundant. So only Case 1 is practically operative in Section 50



II) Rate & Manner of charging Interest

Interest shall be charged @18% p.a. from the date following the due date of payment to the

actual date of payment of tax.

III) Whether Interest will be charged on Gross tax liability or Net tax liability

Earlier in case of delay in payment of tax liability, interest used to be charged on Gross tax

liability (i.e. output tax liability without adjustment of ITC available). This was on account of

lack of any clarification under Sec 50.

What is the

amendment

A lot of representations were filed by industry to GST Council after which the following

proviso has been added in Sec 50 by Finance Act 2019:-

Where supplies have been declared in return filed u/s

39 ( and such return is filed before initiation of

proceedings u/s 73 and 74) but due to delay in filing of

return, tax payment has been delayed

Interest shall be charged on Net

Tax liability (i.e. tax liability to be

discharged through E-cash ledger)

Where tax payment is being made (after due date) in

pursuance of proceedings u/s 73 or 74

Interest shall continue to be

charged on Gross tax liability (i.e.

before adjustment of ITC)

.

Illustration to explain this amendment

Mr. X is a normal taxpayer having aggregate turnover > 5 Crore in preceding FY. During current FY,

following are his details for month of April 2021 Output tax liability = Rs. 15 lakhs

Input tax credit availed = Rs. 10 lakhs

Due date of GSTR-3B in this case will be 20th May 2021

Case When is return filed How will Interest be calculated

Case 1 GSTR-3B filed on 18th May 2021 (Tax

payment of Rs. 5 lakhs made through E-cash

ledger on same date)

No interest shall be applicable in this case

since tax payment has been made before due

date

Case 2 GSTR-3B filed on 31st July 2021 (Mr. X filed

return on his own, without any notice u/s 73 or

74. Tax payment of Rs. 5 lakhs made through

E-cash ledger on same date)

Interest u/s 50 for period 21st May till 31st

July 2020 = (15,00,000 – 10,00,000 ) x 18%

x 72 days/ 365 days

Case 3 GSTR-3B filed on 31st July 2021 (Mr. X

received notice on 20th September 2021 u/s 73

or 74 proposing to recover tax for April month.

Mr. X did not contest such notice & voluntarily

paid Rs. 5L through E-cash ledger & filed

return on 30th September)

Interest u/s 50 for period 21st May till 30th

Sep 2020 = 15,00,000 x 18% x 133 days/ 365

days

In this case, benefit of proviso to Sec 50 will

not be available while calculating interest.

What has changed w.e.f. 1st Sep 2020

Earlier, even in case 2, Interest was charged @18% on 15,00,000 for 72 days. This was creating a lot of

hardship for genuine taxpayers who were honest enough to declare tax in their returns but made a delay in

filing of returns & payment of tax

When is

this

amendment

made

effective

When this provision was made effective from 1st Sep 2020, there were still demands from

industry that this should have been made effective from 1st July 2017. GST Council deliberated

this issue in 37th GST Council Meeting and ultimately decided that this amendment should be

given retrospective effect w.e.f. 1st July 2017. Accordingly, CBIC issued an administrative

instruction on 18th Sep 2020, instructing all GST officers to collect interest only on Net GST

liability for any delayed return filed between 1st July 2017 to 31st Aug 2020 also.



Category F:- Amendments relating to GST Returns

Amendment No. 10:- Change in Due Date of filing GSTR-3B and GSTR-1 in certain cases

Relevant Chapter;- Filing of GST Return

What we

already know

As per Sec 39(1), every normal registered person has to file GST return on monthly basis.

Initially, it was proposed that GST return would be in form GSTR-3, however, thereafter

Rule 61 was inserted to provide that instead of GSTR-3, a new form GSTR-3B shall be

submitted on or before 20th of the immediately succeeding month.

At the same time, Sec 37 provides that every normal registered person has to file a statement

of outward supplies in form GSTR-1 on monthly basis on or before 10th of immediately

succeeding month (practically 1 day extension is provided, so due date is 11th of next

month).

Further, Sec 148 provides special procedure for registered persons, having aggregate

turnover upto 1.5 Crores in preceding FY or current FY, under which they can file GSTR-1

on quarterly basis on or before last of the month immediately succeeding the quarter

What is the

amendment

Extension of Due Date of Filing monthly GSTR-3B

With effect from 1st Jan 2020, due date of GSTR-3B shall be different for different category

of taxpayers. The new due dates are as under:-

Category of Persons Due Date of filing GSTR-

3B

Registered Person with aggregate turnover of more than 5

crore in immediately preceding FY

20th of the following month

Registered person with aggregate turnover upto 5 crore in

immediately preceding FY And who located in following

States:-

- Jammu & Kashmir - Ladakh

- Himachal Pradesh - Uttrakhand

- Punjab - Haryana

- New Delhi - Uttar Pradesh

- Rajasthan - Bihar

- Jharkhand - West Bengal

- Odisha - Sikkim

- Assam - Meghalaya

- Nagaland - Manipur

- Tripura - Mizoram

- Arunachal Pradesh

24th of the following month

Registered person with aggregate turnover upto 5 crore in

immediately preceding FY And who is located in any State

other than mentioned above

22nd of the following month

Extension of Due Date of filing Quarterly GSTR-1

With effect from 15th Oct 2020, due date for registered persons who are filing their GSTR-1

on quarterly basis (under the special procedure prescribed u/s 148) shall be 13th day of the

month immediately succeeding the relevant quarter. In respect of registered persons who are

filing their GSTR-1 on monthly basis, due date shall be same (i.e. 11th day of immediately

succeeding month)



Illustration to understand the new Due Dates

Relevant month Due Date of filing

monthly GSTR-3B

Due Date of filing GSTR-1

If filed on monthly basis If file on quarterly basis

October 2020 20th or 22nd or 24th of

Nov 2020

11th of Nov 2020 13th Jan 2021

(instead of 1st Jan 2021)

November 2020 20th or 22nd or 24th of

Dec 2020

11th of Dec 2020

December 2020 20th or 22nd or 24th of

Jan 2021

11th of Jan 2021

Amendment No. 11:- Filing of GSTR-3B, GSTR-1 and GST CMP-08 through SMS– Rule 67-A

of CGST Rules

Relevant Chapter;- Filing of GST Return

What we

already know

Every normal registered person (i.e. who is not composition dealer u/s 10) has to file the

following:-

GST return u/s 39 in form GSTR-3B on monthly basis

Statement of outward supplies u/s 37 in form GSTR-1 on monthly or quarterly basis

Further, composition dealer u/s 10 has to be file the following:-

Statement in form GST CMP-08 on quarterly basis

Return u/s 39 in form GSTR-4 on annual basis

The above returns or statements have to be filed even if no supplies have been made during a

relevant month or quarter (concept of Nil return or statement)

Methods of filing above returns/statements

1) Online filing directly on GST Common Portal

2) Filing through offline utilities provided by GSTN (statement or return is prepared in

excel based offline utilities and then uploaded on Common portal)

3) Filing through GST Suvidha Providers (GSP)

What is the

amendment

With effect from 15th October 2020, a new rule 67A has been inserted which provides that

following returns/statements can be filed through SMS facility:-

a) NIL GSTR-3B u/s 39 in case of normal dealers

b) Nil GSTR-1 u/s 37 in case of normal dealers

c) Nil GST CMP-08 in case of composition dealers

Meaning of Nil Return or Statement

For the purposes of this rule, a Nil GSTR-3B or Nil GSTR-1 or Nil GST CMP-08 means

such return or statement for a tax period in which there is Nil or no entry in all Tables

How does SMS facility work

SMS has to be sent in prescribed format to ‘14409’. A 6 digit code shall be sent by GST

Common portal to registered mobile number (of the authorized signatory) through which

authentication is done.

Illustration to understand the amendment

Mr. Sanchit, a registered person (who has not opted for composition scheme u/s 10), has provided the

following information:-

Particulars Relevant Tax period for which information provided

Oct 2020 Nov 2020 Dec 2020 Jan 2021

Are there any outward supplies done

during the month

Yes Yes No No



Are there any inward supplies done

during the month

Yes Yes Yes No

Gross Output tax payable 10,00,000 4,00,000 Nil Nil

ITC available 6,00,000 7,00,000 2,50,000 Nil

Net tax to be paid in cash 4,00,000 Nil Nil Nil

Whether there is need to file return/statement in each case

GSTR-1 Yes Yes Yes Yes

GSTR-3B Yes Yes Yes Yes

Manner of filing return/statement

GSTR-1 Through GST

Portal

Through GST

Portal

Through

GST Portal

or SMS

facility

Through GST

Portal or

SMS facility

GSTR-3B Through GST

Portal

Through GST

Portal

Through

GST Portal

Through GST

Portal or

SMS facility

CA- INTERMEDIATE...CA- INTERMEDIATE GST AMENDMENTS applicable for May 2021 ATTEMPT By :- CA SANCHIT...

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