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Major changes in GST made applicable from 01.10.2022 
(Effective date notified vide N.No.18/2022 - CT dated 28.09.2022)
(Enacted by Finance Act, 2022)

CBIC has issued Notification No.18/2022 - CT dated 28.09.2022 notifying effective date as 01.10.2022 for the amendments enacted by Finance Act, 2022. Below is the summary of important amendments applicable from 01.10.2022.

Table of Contents

1. More Restrictions imposed for availing ITC.

2. Extension of time limit for availing ITC.

3. Tightening the provisions for cancellation of Registration by officer.

4. Extension of time limit for issuing credit note.

5. Amendment in the procedure for filing return of outward supply.

6. Amendment in provisions for furnishing of Return u/s 39.

7. ITC reversal and interest payment by buyer in respect of supplies on which supplier defaults in making payment.

8. Removal of two way acceptance and rejection communication process for invoices and credit notes under GST.

9. Levy of late fee on GSTR-8.

10. Payment of taxes.

11. No Interest on wrong ITC availment if not utilized by taxpayer [w.r.e.f. 01.07.2017]. 

12. Extension of time limit for rectification of errors in return furnished in GSTR-8.

13. Refund of Tax.

1. More Restrictions imposed for availing ITC


Clause (ba) inserted in section 16(2) to provide additional condition for claiming ITC by a buyer that ITC with respect to an invoice can be availed by buyer only if such ITC has not been restricted in the details communicated to buyer in the form of auto generated statement (i.e. GSTR-2B) u/s 38 of CGST Act.

Also, section 38 has been substituted to provide that now, the auto generated statement of ITC (i.e. GSTR-2B) shall consist of two below major components.

(a) details of ITC which may be availed; and

(b) details of ITC which cannot be availed in respect of invoices furnished u/s 37(1) -

i) by any registered person within such period of taking registration as may be prescribed; or

ii)  by any registered person, who has defaulted in payment of tax and where such default has continued for such period as may be prescribed; or

iii) by any registered person, the output tax payable by whom in accordance with the statement of outward supplies furnished by him under the said subsection during such period, as may be prescribed, exceeds the output tax paid by him during the said period by such limit as may be prescribed; or

iv) by any registered person who, during such period as may be prescribed, has availed credit of input tax of an amount that exceeds the credit that can be availed by him in accordance with clause (a), by such limit as may be prescribed; or

v) by any registered person, who has defaulted in discharging his tax liability in accordance with the provisions of sub-section (12) of section 49 subject to such conditions and restrictions as may be prescribed; or

vi) by such other class of persons as may be prescribed.

The Main intention behind this amendment is to break the fraudulent ITC chain of dealers causing great loss to the nation. However this amendment is going to bring lot of difficulties to genuine buyers also where their supplier does not discharge his GST liability properly.

In a number of judgments, it has been held that recipient cannot be held responsible for the default of supplier in paying his taxes, if the transaction is a genuine one. So the proposed amendment shall cover these cases also and shall have adverse effect on genuine buyers / recipients.

 

2. Extension of time limit for availing ITC.


Section 16(4) amended to provide time limit for availing ITC in respect of invoices or debit note pertaining to a Financial Year upto 30th November of the following financial year.

Earlier the time limit was due date of September month i.e. 20th October / 22nd October / 24th October as the case may be.

 

3. Tightening the provisions for cancellation of Registration by officer


For Composite Dealer

Section 29(2)(b) amended to provide for cancellation of registration of a composite dealer if he fails to furnish return for a financial year beyond 3 months from the due date.

Earlier the registration was liable to be cancelled if dealer does not furnish return for three consecutive tax periods. This amendment is being made because earlier composite dealers was liable to file return on quarterly basis but now they are liable to file return on annual basis. So 3 tax period would literally mean 3 years and this was not the intention of legislatures. Therefore this amendment was necessary.

For other than composite dealer

Earlier the registration was liable to be cancelled if dealer does not furnish return for a continuous period of six months.

Now, section 29(2)(c) amended to provide for cancellation of registration of dealer if he fails to furnish return for such continuous period as may be prescribed. (Therefore it seems, government is planning to reduce this period of six months to a lower figure say 2 or 3 months).

 

4. Extension of time limit for issuing credit note.


Section 34(2) amended to provide time limit for issuing credit note in respect of supplies made in a Financial Year upto 30th November of the following financial year.

Earlier the time limit was the same as the return filing for September month of the following financial year.

 

5. Amendment in the procedure for filing return of outward supply.


(i) Section 37(3) is being amended to provide extended time limit upto 30th November of the following financial year for rectification of errors in respect of outward supplies furnished u/s 37(1) i.e. GSTR-1.

(ii) Section 37(2) is being omitted to remove the requirement of acceptance or rejection of invoices furnished and communicated to recipient.

(iii) Section 37(4) is being inserted to mandate the chronological monthly filing of return of outward supply. E.g. Return of October month cannot be filed, if return of September month is not filed.

 

 

6. Amendment in provisions for furnishing of Return u/s 39. Section.......
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Author:

TaxReply


Sep 29, 2022

Comments


Super sir
Thanks
By: R.ganesan | Dt: Sep 29, 2022
Dear sir,
Air/Ocean Freight on Import of Goods GST Applicable ?
If applicable Forward charges or Reverse Charge & Rate of GST
kindly clarify.
By: Profezon Advisors Pvt Ltd | Dt: Nov 18, 2022


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