Benefits introduced by the GST Authorities

In the times of pandemic, GST Authorities have extended few benefits to generals by relaxing late fees and interests on compliances, processing refunds at earliest, easing FTP guidelines pertaining to import and export. A few of relaxation and favorable amendments have been made by CBIC in past one month, few of them are briefed as under.

Jharkhand High Court, Ruling-1                
Mahadeo Construction Co.

Issue Involved:

Whether recovery procedures can be initiated without issue of proper Show Cause Notice

Facts:

• The Firm is required to furnish monthly return on or before 20th day of the month succeeding such calendar month in which returns were to be filed. However, due to the Nationwide problem in GSTN Portal, the GSTR-3 Return, as auto populated could not being generated, provisions have been incorporated for filing GSTR-3B Return in terms of Rule 61(5) read with Rule 61(6) of the Central Goods and Services Tax Rules, 2017 (for short ‘CGST Rules’).
• On delay in payments of GST liability beyond 20th day of succeeding month or extended due date, would be liable to interest under Section 50.
• The petitioner was served with a letter directing the petitioner to make payment of interest on the ground of delay in filing of GSTR-3B Return. The respondent-Authorities further exercised powers under Section 79 of the CGST Act by initiating garnishee proceedings for recovery of aforesaid amount of interest by issuing notice to the petitioner’s Banker. The initiation of garnishee proceedings under Section 79 of the CGST Act is also impugned in the present writ application.

Decision:

It was held that respondent Authorities to initiate appropriate adjudication proceeding either under Section 73 or 74 of the CGST Act (as the case may be) against the petitioner-assessee and determine the liability of interest, if any, in accordance with law after giving due opportunity of hearing to the petitioner.

Karnataka High Court, Ruling-1  
Taghar Vasudeva Ambrish.  

Issue Involved:

Goods and Services Tax liability on paying guest services rendered to students

• Whether Lessor  need not charge GST while issuing the invoice for lease services
• Whether lease service falls under the exemption prescribed and can be described as “ Service by way of renting of residential dwelling for use as resident”

Facts:

• Lessor along with four (4) others collectively has let out a Residential complex to Lessee which is engaged in providing affordable residential accommodation to student on a long term basis.
• Further, Lessee has entered into sub-lease agreement with students for providing residential accommodation for long stay period from 3 months to 11 months.
• Consequently, there would be no GST obligation on lessee in case of lease agreement with their lessor too. Therefore, Lessee is of opinion that lessor even should not charge GST to Lessee when issuing the lease invoice.
• The contract of applicant group is verified and found that what is given is an immovable property consisting of rooms with attached toilets as per the layout of leased premises annexed to  lease agreement and doesn’t fit into meaning of a dwelling which means a house. They are like hotels and entire leased premises has 42 rooms, which can by no imagination be termed as residential dwelling and services by hotels, inns, guest house , clubsite and campsite, by whatever name called or other commercial places for residential or lodging purposes are covered by different entries of this notification or under different notification. 
•  This shows that room though given for residential purpose would not amount to residential dwelling and hence entry is not applicable for transaction of the lessor and lessee.

Decision:

• The exemption of residential dwelling cannot be sought and lessor have to charge GST while issuing the invoice for lease services to Lessee.
• Lease doesn’t fall under the exemption “services by way of renting of residential dwelling for use as residence”.

Notification 30/2020-CGST

A proviso is inserted in Rule 36(4), providing for cumulative application of Rule 36(4) of CGST Rules regarding matching of ITC to be availed in GSTR-3B with GSTR-2A, in GSTR-3B of September’2020 for March’2020 to August’2020.

Notification 37/2020-CGST

Form PMT-09 in reference to inter account transfer of CGST/SGST/IGST/ Interest/Late fees etc. of electronic cash ledger to another head of electronic cash ledger, from April 21, 2020.

Circular 136/6/2020-CGST

The said class of taxpayer have been allowed to furnish the statement specified in section 52 (GST Return for TCS), due date from March 20, 2020 to June 29, 2020 on or before the 30th day of June, 2020.

Except for few provisions covered in exclusion clause, any time limit for completion or compliance of any action which falls during the period from the 20th day of March, 2020 to the 29th day of June, 2020, and where completion or compliance of such action has not been made within such time, has been extended to 30th day of June, 2020.

Circular 137/7/2020-CGST

• The supplier is required to issue “credit note” in case advances upon which GST is paid got cancelled subsequently and for which invoice may or may not be issued before supply of service. He shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim.
• However, in case there is no output liability against which credit note can be adjusted, registered person may proceed to file claim under “excess payment of tax” under RFD-01.
• Time limit for filing of LUT for the year 2020-21 shall stand extended to 30.06.2020 and the taxpayer can continue to make the supply without payment of tax under LUT provided that the FORM GST RFD-11 for 2020-21 is furnished on or before 30.06.2020. Taxpayers may quote the reference no of the LUT for the year 2019-20 in the relevant documents.
• The said class of taxpayer have been allowed to furnish the statement specified in section 39 (3) (GST Return for TDS), due date from March 20, 2020 to June 29, 2020 on or before the 30th day of June, 2020.
• The said class of taxpayer have been allowed to furnish the statement specified in section 54 (GST Refund application), due date from March 20, 2020 to June 29, 2020 on or before the 30th day of June, 2020.

GST Calendar –March and April ’2020

Extended Due Date	Due Date relates to	Who needs to do the compliance	Late Fee
May 05, 2020	GSTR-3B for the month of March 2020	Taxpayers having turnover of more than 5 crore	Rs. 100/- per day (*Int. at 9%, for return filed upto June24, 2020, post which Int. @18%)
June 04, 2020	GSTR-3B for the month of April 2020	Taxpayers having turnover of more than 5 crore	Rs. 100/- per day (*Int. at 9%, for return filed upto June24, 2020, post which Int. @18%)
June 29, 2020	GSTR-3B for the month of March 2020	Taxpayers having turnover of less than 5 crore	Rs. 100/- per day (*Int. @18%)
June 29, 2020	GSTR-3B for the month of April 2020	Taxpayers having turnover of less than 5 crore	Rs. 100/- per day (*Int. @18%)
June 30, 2020	GSTR-1 for the month of March and April 2020	Any Taxpayer	Rs. 200/- per day
June 30, 2020	GSTR-6 for the month of February 2020	Input Service Distributor	Rs. 50/- per day
June 30, 2020	GSTR-3B for the month of Jan to  March 2020	Taxpayers having turnover of upto 1.5 crore	Rs. 200/- per day
July 31, 2020	GSTR-1 for the month of April to September 2020	Taxpayers having turnover of upto 1.5 crore	Rs. 200/- per day