GST UPDATE-CA JP Jain

 Provision for Aadhar Authentication in GST Registration:

From today onwards, Aadhar authentication for GST Registration is required.

Read below for details:

1. Aadhaar Authentication process has been introduced, for the persons applying for GST registration as Normal Taxpayer/ Composition/ Casual Taxable Person/ Input Service Distributor (ISD)/ SEZ Developer/ SEZ Unit etc, in Form GST REG 01 (refer Notification No 62/2020-CT dt 20.08.2020 ). 

2. Under this, Individuals, Authorised signatory of all types of businesses, Managing and Authorised partners of a partnership firm and Karta of an Hindu undivided family, applying for new registration, can opt to undergo e-KYC authentication of their Aadhaar number. 

3. Applicants, who, either do not provide Aadhaar, while applying for new registration or whose Aadhar authentication fails in validation, would be subjected to site verification by the tax department. However, Tax authority based on the documents produced can grant registration. 

4. Timelines for grant of registration are: 

--> In case of successful authentication of Aadhaar, registration will be deemed approved within 03 working days 

--> If Aadhar authentication is not opted for or if authentication fails in validation and no SCN is issued within 21 days by tax official, registration will be deemed approved 

--> Tax Officer can issue SCN within the period specified for grant of registration, like in cases of successful Aadhar authentication i.e. 03 working days, or in cases when taxpayer do not opt to provide Aadhaar or when Aadhar authentication fails i.e. 21 working days. Applicants can submit their reply within 07 working days from issue of SCN 

5. Important points while opting for Adhaar authentication is as follows: 

--> Once registration application is submitted, an authentication link will be shared on GST registered mobile numbers and email ids mentioned in the GST application 

--> On clicking the verification link, a window for Aadhaar Authentication will open where they have enter Aadhaar Number and the OTP received by them on the mobile number linked with Aadhaar 

--> Taxpayer need to complete Aadhaar authentication of all Promoters/ Partners/ Authorized Signatories/ Karta etc. as mentioned in the application to avail this option 

--> Applicant can access the link again for authentication by navigating to My Saved Applications > Aadhaar Authentication Status > RESEND VERIFICATION LINK 

--> Persons already registered on GST portal are not required to undergo Aadhar authentication at this stage 

Persons who are not resident /citizen of India are exempted from the Aadhaar authentication process

Source - Official Notification and GSTN Team

https://www.cbic.gov.in/htdocs-cbec/gst/notfctn-62-central-tax-english-2020.pdf

Ministry of Corporate Affairs Update

Ministry of Corporate Affairs has updated the *View Signatory Details*_

The address of the Directors and Key Managerial Personnel is Not available in public domain now.

31.8.20 is last date to file GST RFD-11 for LUT for Exports & Supplies to SEZ without payment of tax & GST CMP-02 to opt for Composition Scheme for FY 20-21.

Cos unable to hold AGM for 19-20 can apply for extension in GNL-1 by 29.9.20. ROCs to be liberal for extensions upto 3 months. Gen Circular 28/2020 of 17.8.20.

Income Tax Update-13/08/2020-Transparent Taxation – Honoring The Honest

 PM Narendra Modi launches a platform for Transparent Taxation to Honor the Honest.

TAXPAYER’S CHARTER

A. Commitment to taxpayers by Income Tax Department

• To provide fair, courteous, and reasonable treatment
• Treat taxpayer as honest
• To provide mechanism for appeal and review
• To provide complete and accurate information
• To provide timely decisions
• To collect the correct amount of tax
• To respect privacy of taxpayers
• To maintain confidentiality
• To hold its authorities accountable
• To enable representative of choice
• To provide mechanism to lodge complaint
• To provide a fair & just system
• To publish service standards & report periodically
• To reduce cost of compliance

B. Expectation from taxpayers by Income Tax Department 

• Be honest & compliant
• Be informed
• Keep accurate records
• Know what your representative does on your behalf
• Respond in time
• Pay in time

FACELESS APPEALS

A. Features

• Appeals to be randomly allotted to any officer in the country
• The identity of officers deciding appeal will remain unknown
• No need to visit the officer/office
• The appellate decision will be Team­ Based & reviewed

B. Exceptions: CASES RELATING TO

• Serious frauds, Major Tax Evasion, Sensitive & Search matters
• International tax
• Black Money Act & Benami Property

WIDENING THE TAX BASE

A. Deduction or collection of tax TDS or TCS on new transactions:

• TDS on Cash withdrawal above Rs. 1 crore (in case of Non-filers limit is Rs. 20 lakh)
• TCS on motor vehicle above Rs. 10 Lakh
• TCS on Foreign remittance under LRS above Rs. 7.5 lakh/overseas tour packages
• TDS on e-commerce suppliers & TCS on purchase of goods above Rs. 50 Lakh

B. Expansion of scope of Reporting of transactions:

• Cash deposit or withdrawal of Rs. 50 lakh or more in current account
• Cash Deposit of above Rs. 10 lakh or more in non­ current account
• Sale of foreign exchange above Rs. 10 lakh
• The reporting of transactions of mutual funds, credit card transactions, immovable property, etc. rationalized

C. Compulsory Filing of return:

• Deposit above Rs.1 crore in current account or
• Expenditure of above Rs. 2 lakh on foreign travel &
• Electricity consumption above Rs. 1 lakh

Proposed Measures for Widening of tax base

A. Expansion of scope of Reporting of transactions (SFT):

• Payment of educational fee or donations above Rs. 1 lakh per annum
• Electricity consumption above Rs. 1 lakh per annum
• Domestic business class air travel or foreign travel
• Payment to hotels above Rs. 20,000
• Purchase of Jewellery, white goods, painting, marble, etc. above Rs. 1 lakh
• Deposit or credits in current account above Rs. 50 lakh
• Deposit or credits in non-current account above Rs. 25 lakh
• Payment of property tax above Rs. 20,000 per annum
• Life Insurance premium above Rs. 50,000
• Health insurance premium above Rs. 20,000
• Share transactions / D-MAT accounts/Bank lockers

B. Deduction/collection of tax at higher rates for non-filers of return

C. Compulsory filing of return by the person having bank transactions above Rs. 30 lakh, all professionals, businesses having turnover above Rs. 50 lakh, payment of rent above 40,000

Ease of compliance for taxpayers 

A. Faceless E-assessment Scheme

The E-assessment Scheme, 2019 eliminates

• Interface between the Assessing Officer and the assessee
• Optimising use of resources through functional specialisation
• Introducing the team-based assessment

B. Document Identification Number {DIN)

• Every communication of the department issued from 1st Oct 2019 mandatory to have computer-generated unique DIN

C. Pre-filing of Income-Tax Returns

• ITR form now contains pre-filled details of certain incomes

D. Simplification of compliance norms for Start-ups

• Hassle-free assessment procedure, exemptions from Angel-tax, the constitution of dedicated start-up cell
• The threshold for launching prosecution increased
• System of a collegium of senior officers for sanction of prosecution introduced
• Norm for compounding relaxed

Update for Charitable Trusts and Exempt Institution registered under section 80G, 12A or section 12AA

New - Fresh Registration Required :Last Date 31.12.2020

All Charitable trusts and exempt institution which are already registered under section 80G, 12A or section 12AA of Income Tax Act, 1961 will now be required to obtain FRESH REGISTRATION by December 31, 2020. Provisions of

registration under section 80G, 12AA or section 12A will be redundant from 31st December, 2020 and a new section 12AB will 

come into force with effect from 01st January 2021. All the existing registered trusts under the erstwhile section 80G, 12A or

section 12AA would move to new provision section 12AB.

The new section 12AB proposes to change the registration process by prescribing the time frame for processing the

application and validity of such a registration certificate so granted under the new section 12AB.

An order granting registration or approval shall be passed within 3 months of the application. Such registration or

approval shall be valid for 5 years.

Similarly, charitable trusts and exempt institutions which already have Section 80G certificate will now be required to

reapply for registration or approval by December 31, 2020. 

The registration shall be valid for 5 years.

Reserve Bank of India Updates By CA J. P. Jain

 चेक क्लीयरेंस के नियमों में RBI ने किया बदलाव, बदल जाएगा लेन-देन का तरीका.                                                नई दिल्ली: RBI की मौद्रिक नीति ( Monetary Policy ) में किस तरह के फैसले लिए जाएंगे इस बात पर सभी की निगाहें थी और फाइनली अब 3 दिन तक चली इस मीटिंग के नतीजे सामने आ चुके हैं । और रेपो रेट ( REPO RATE ) में किसी प्रकार के बदलाव न होने के बाद जिस एक फैसले की सबसे ज्यादा चर्चा हो रही है वो है चेक क्लीयरेंस से संबंधित। नए नियम के मुताबिक RBI ने 50 हजार रुपये या उससे अधिक के सभी चेक के लिए पॉजिटिव पे ( Positive Pay system ) सिस्टम शुरू करने का फैसला किया है। इस सिस्टम ( Positive Pay system ) के अन्तर्गत चेक जारी द्वारा दी गई जानकारी के आधार पर चेक को बैंक से भुगतान के लिए संपर्क किया जाएगा।.                                      आसान भाषा में कहें तो Positive Pay system के तहत, लाभार्थी को चेक सौंपने से पहले खाताधारक द्वारा जारी किए गए चेक का विवरण जैसे चेक नंबर, चेक डेट, Payee नाम, अकाउंट नंबर, रकम आदि के साथ-साथ चेक के सामने और रिवर्स साइड की फोटो के साथ शेयर करना जरूरी होगा। जब लाभार्थी चेक को इनकैश करने के लिए जमा करेगा तो बैंक पॉजिटिव पे के जरिए प्रदान किए गए चेक डिटेल्स की तुलना की जाएगी. अगर डिटेल्स मेल खाएंगे तो चेक क्लीयर हो जाएगा।RBI ने ये फैसला चेक भुगतान ( Cheque Payment ) में कस्टमर्स की सिक्योरिटी बढ़ाने और चेक लीफ से छेड़छाड़ के कारण होने वाली धोखाधड़ी की घटनाओं को कम करने के लिए RBI ने नया सिस्टम पेश किया है।रिजर्व बैंक ( reserve bank ) ने लॉकडाउन को देखते हुए इस साल 2 बार ब्याज दरों में 1.15 फीसदी की कटौती की है, लेकिन इस बैठक में ब्याज दरों में किसी प्रकार का बदलाव नहीं ( REPO RATE Unchanged ) किया गया है।

GST Advisory by GSTN

 

view of the Removal of Difficulty Order No. 01/2020 dated 25.06.2020, the restriction on filing revocation application, in case it was rejected, has been removed. Aggrieved taxpayers can file an application for the revocation of the cancellation of registration once again.

Further, those taxpayers who have filed Appeal against rejection of the Revocation Application and the decision is still pending, they may also file the Revocation of Cancellation. The taxpayer is required to log in and navigates to Services> Registration> Application for Revocation to file the application for revocation.

The advisory can be accessed at: https://www.gst.gov.in/newsandupdates/read/390

GST Update

 GST Update admissibility of ITC on Paver Blocks 108/2020-21

Input tax credit is an essential component of GST which aims at removing cascading effect of taxes. However, availability of ITC in relation to construction services which are used in the course of furtherance of business has always been a point of dispute since erstwhile regime. The present update seeks to discuss the advance ruling pronounced in the case of M/s Sundharams Private Ltd. wherein the issue raised was regarding entitlement to avail input tax credit in respect of Paver Blocks laid on the land which were not capitalised to buildings.

The applicant contended that laying of Paver Blocks on land does not amount to construction of immovable property u/s 17(5)(c) of the CGST Act, 2017 and are to be construed as moveable items as such paver blocks are not to be permanently embedded on earth and are capable of being removed as such without causing damage to them for reuse elsewhere. It was also contended by the applicant that they have considered the expense as revenue expenditure and as they have not capitalised the said expense to the building account, the restriction contained in section 17(5) does not apply in the present case. However, the Authority for Advance ruling has held that the purpose of laying of paver blocks is to ensure efficient parking of automobiles with no wear and tear, to have longevity, durability and flexibility to re-use. The flexibility to re-use does not mean that blocks will be removed and re-erected frequently. They are meant to be permanently fixed to earth but whenever the need arises the applicant may remove them and re-erect.

The reasoning taken by the authority also included that mere capability of removal and reuse elsewhere, doesn’t mean blocks are not permanently embedded to earth. It was held that the applicant would not use the paver blocks with an intention to remove it and use the same as a movable property. In the instant case the laying of Paver Blocks would qualify as immovable property and therefore applicant cannot avail input tax credit as per Section 17(5) of the CGST Act, 2017.

The applicant had also placed reliance on the decision given by Hon’ble Orissa High Court in the case of M/s Safari Retreats allowing availment of ITC on construction of malls which are further let out. However, the AAR did not consider the decision on the grounds that the Special Leave Petition has been filed and admitted before the Hon’ble Supreme Court and the matter is sub-judice, pending for final decision.

In this context, reference can be made to ruling given in the case of M/s Sree Varalakshmi Mahaal LLP – AAR Tamil Nadu wherein it was held that the ITC is not available against any goods or services used by the applicant for construction of the marriage hall on his own account, even if said gods or services are used in course or furtherance of his business. Even in case of M/s Unity Traders -AAR MP it was held that ITC is not admissible under section 17(5) on goods purchased for purpose of construction and maintenance of warehouse used for letting out on rent.

It is observed that apart from favourable decision pronounced by the Hon’ble High Court of Orissa in the case of Safari Retreats Pvt. Ltd., wherein the principle of seamless flow of credit in the supply chain has been considered of paramount importance, the AAR do not follow the decision on the grounds that SLP is pending before the Supreme Court. We have time and again mentioned that in view of principle of judicial discipline and the verdict of Apex Court in the case of Kamalakshi Finance Corporation Ltd., mere filing of appeal before Court or higher appellate forum cannot be the basis for not following the ratio laid down by the High Court. However, there is tendency of department of not following the decision where appeal has been preferred and pending before the higher forum. Nonetheless, the aspect regarding treating the expenditure of paver blocks as revenue expenditure was not considered by the AAR which in our opinion has substantial weightage in cases where availability of input tax credit on construction related services is concerned. It is clear that construction includes renovation or repairs and if such expenditure is not capitalised in the books of accounts, the input tax credit is admissible to the assessee. It is hoped that this aspect is examined by the AAAR if the decision of AAR is appealed further by the applicant.