Significant Recommendations of the 53rd GST Council Meeting

KORAH & KORAH, CHARTERED ACCOUNTANTS

This Note has been prepared based on the Press Release dated 22nd June 2024 published by the Press Information Bureau with the title ‘Recommendation of 53rd GST Council Meeting’ along with the clarifications provided by the GST Council

Waiver of interest or penalty or both

  1. Section 128A in CGST Act, 2017 has been inserted to provide conditional waiver of interest or penalty or both on the full payment of tax demand before 31st March 2025, raised through Notices issued under Section 73, for FYs 2017-18 to 2019-20.
  2. However, this waiver does not apply for demand on erroneous refunds.

K&K’s Comments ~ this is a positive move by the Government to address genuine concerns of many taxpayers, especially in the early years of GST implementation. The benefit is confined only to the Section 73 cases, though there are many other cases adjudicated by the Department under Section 74.

Monetary limits for filing of Appeals

  1. Monetary Limits has been fixed for filing of Appeals under GST by the Department in the following manner – (a) GSTAT is INR 20 Lakhs; (b) High Court is INR 100 Lakhs and (c) Supreme Court is INR 200 Lakhs.

 K&K’s Comments ~ currently, there no monetary limits provided under Section 120. This is indeed a welcome move to reduce the mounting litigation.

Change in due-dates for Composition Tax Payers

  1. Change in due date has been proposed for the filing of return in FORM GSTR-4 for composition taxpayers from 30th April to 30th June following the end of the financial year. This will apply for the returns to be filed for FY 2024-25 onwards.

K&K’s Comments ~ this is going to be beneficial for small taxpayers as they would be getting some more time to file their return.

New amendment opportunity in GSTR 1

  1. The GST Council recommended providing a new optional facility by way of FORM GSTR-1A to facilitate the taxpayers to amend the details in FORM GSTR-1 for a tax period and/ or to declare additional details, if any, before filing of return in FORM GSTR-3B for the said tax period.

K&K’s Comments ~ this is the result of continuous efforts of the 53rd GST Council in plugging the tax leakage through improvised compliance processes. The New Form GSTR-1A would now permit the taxpayers to make suitable amendments in liabilities declared in GSTR-1 without waiting
for next month GSTR-1.

Exemption of Accommodation Services

  1. A separate entry in Notification No. 12/2017- CTR 28.06.2017 will be inserted to exempt accommodation services having value of supply of accommodation up to INR 20,000/- per month per person subject to the condition that the accommodation service is supplied for a minimum
    continuous period of 90 days.

K&K’s Comments ~ earlier this exemption was available for stay in PG’s, guest houses etc. where tariff charges per day was less than INR 1,000. However, with withdrawal of this exemption, there was confusion as to whether exemption can be claimed by hostels, PG etc. by treating it as
renting of residential dwellings.

The Council has now extended benefit for such hostels, PG etc. where total amount charged is less than INR 20,000/- per month and total period of stay is  minimum 90 days. This is a big relief to this industry and students / labourers who migrate to bigger cities for educations or jobs.

Time limit to avail ITC in case of RCM supplies

  1. The Council clarified that in cases of supplies received from unregistered suppliers, where tax has to be paid by the recipient under reverse charge mechanism (RCM) and invoice is to be issued by the recipient only, the relevant financial year for calculation of time limit for availment of input tax credit under the provisions of section 16(4) of CGST Act is the financial year in which the self-invoice has been issued by the recipient.

  K&K’s Comments: suppose a supply liable to RCM is received in FY 2019-20 but the taxpayer pays the tax under RCM thereon in FY 2023-24 along with interest during Department Audit, then the Council has clarified that time limit in such case would be applicable from the date of raising of
self-invoice i.e. the date of payment of tax liability. Hence, all past disputes would get resolved.