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Latest Amendments in GST in India

1. Widened scope of Input Tax Credit

This is the most important recent judgements as the government has decided to widen the scope of input tax credit and it will be permissible in respect of the following:

  • Any activity or transaction mentioned in Schedule III of CGST Act as it deals with the definition of Supply.
  • Motor vehicles having a seating capacity of more than thirteen (including the driver), vessels and aircraft that is used for transportation of persons.
  • General insurance, maintenance and repair of motor vehicles, vessels and aircraft on which ITC is permissible.
  • Any products or/and services that are mandatory under any law for an employer to provide to its employee.

2. Now the commissioner can extend the due date up to a period of 1 year and 2 years for returning the inputs and capital goods that are sent on job work.

3. Rationalization in the order of cross-utilization of ITC (Input Tax Credit).

4. Place of supply would be outside India for the goods that are temporarily imported in India in case of job work and then exported back without utilizing them to any further use in India.

5. Any taxpayer who is registered under GST can issue consolidated credit or/and debit notes for multiple invoices that are generated in a Financial Year.

6. No supply under Schedule III

Under schedule III there are certain amendments according to which there are some transactions that will be treated as no supply or they will not taxable. These transactions are:

  • When there is a supply of good from one non-taxable territory to any other territory without entering into the border of India
  • If there is a supply of warehoused goods before clearance to any person for home consumption
  • High sea sales of goods.

7. Pre-deposit amount of 25 Crore INR or 50 Crore INR payable for filing an appeal before the Appellate Authority and Appellate Tribunal.

8. Amount of IGST that is not distributed to the Centre or the States/UTs can be apportioned on an ad-hoc basis at the rate of 50% to the Centre and 50% to the State or UT’s on the recommendation of GST council. Moreover, this amount will be adjusted against the apportioned amount.

9. At any point in the financial year during the transition period, 50% of unutilized compensation fund shall be transferred to the central government in the Consolidated Fund of India on the recommendation of the GST Council. In addition to this, the remaining balance 50% shall be apportioned in the State government or union territories on the basis of their base year revenue ratio.

10. In case if the collected amount in the Consolidated Fund against the requirement then in such scenario compensation of about 50% for any two months period shall be released. However, such amount shall not surpass the total amount transferred to the central government and state or union-territory government as recommended by the Council and if the amount exceeds then the 50% amount must be recovered from them and the remaining 50% shall be recovered from the state government on the basis of their base year revenue ratio.