By TIOL News Service

NEW DELHI, NOV 28, 2017: THE CBEC has notified the SOP for filing claim for the first quarter ending September, 2017 for the Budgetary Support Scheme (BSS). Netizens may recall that the BSS was notified in lieu of the area-based exemption scheme notified by the Central Govt during in the erstwhile regime. Since the GST regime grants no such exemption to such units, as a measure of goodwill the Union of India had notified the BSS promising refund of only 58% of the tax paid.

As per the CBEC Circular, the scheme would work as follows:

Registration of the eligible units :

(i) The application for registration under the scheme by the eligible units shall be submitted in triplicate in the format attached to this circular. The application shall be signed by the proprietor/partner/managing director of the eligible unit or by the person authorized by him in this behalf and supported by the self-authenticated copies of the documents in support of information as per the application. The registration under GST is a necessary pre-requisite for the scheme.

(ii) In case more than one eligible unit is operating under the same GSTIN, separate registration is required to be obtained for each of the eligible units.

(iii) The jurisdictional Deputy Commissioner/Assistant Commissioner of the Central Taxes would examine the application in terms of the scheme as notified on the basis of documents submitted along with the application for registration.

(iv) A unique ID for each of the eligible units shall be allotted after registration and ID shall be indicated in the following manner: - sl.no./ name of Central Tax Division/name of Commissionerate/GSTIN. The ID shall be endorsed on all the three copies of the application.

(v) It shall be ensured by the jurisdictional Divisional Officer that record of registration is maintained against the sl.no. which is part of the unique ID.

(vi) The second copy of the application after registration of the eligible unit under an official communication shall be forwarded to the DDO of the Division for registration of the unit under PFMS. This would ensure validation of the Bank Account details of the beneficiary. This exercise should be completed within 3 days of receipt of the copy of application by the DDO.

(vii) The third copy of the application after registration shall be forwarded to the ADG, DG Audit, Delhi who in turn would be providing the details to programme division (PD) of DIPP in a compiled manner. The DIPP on the basis of these details shall draw a programme for inspection of the eligible unit by a team constituted by them. Jurisdictional Commissionerate of CGST shall provide necessary assistance in carrying out the inspection. Immediately after completion of inspection a copy of Inspection report would be forwarded to the Assistant/Deputy Commissioner having jurisdiction over the eligible unit.

Sanction of Refund

(i) An eligible unit after allotment of the Unique ID may file an application for claiming budgetary support under the provisions of para 5.7 of the scheme in the format attached to this circular. The application shall be filed by the eligible unit only after return for the quarter has been filed and tax as per return is paid.

(ii) Once application is filed, duly supported by the prescribed document, the same shall be processed for sanction. The claim shall be sanctioned after verification of the tax paid by the eligible unit. The details relating to tax payment in cash and input tax credit availed, utilized including purchases made from a composition dealer during the quarter shall be available in the GST returns of the taxpayer, which are available on the CBEC GST Application for verification of the application for the budgetary support filed by the unit. The closing balance of the credit after end of the quarter shall also be provided for verification by the Assistant/Deputy Commissioner.

(iii) In cases where an entity is carrying out its operations in a State from multiple business premises , in addition to manufacture of specified goods by the eligible unit, under the same GSTIN as that of the eligible unit, the application for budgetary support shall be supported by additional information duly certified by a Chartered Accountant, relating to receipt of inputs (receipt from composition dealer to be indicated separately), input tax credit involved on the inputs or capital goods received by the eligible unit and the quantity of specified goods manufactured by the eligible unit vis-a-vis the inputs, input tax credit availed and specified goods supplied by the registrant under the given GSTIN.

In such case, on the basis of additional information and the refund application the jurisdictional Deputy Commissioner/Assistant Commissioner shall ensure that budgetary support is limited to the tax paid in cash after utilization of the input tax credit on the specified goods manufactured by the eligible unit. The return filed by the unit may be covering the entire transactions taking place outside the eligible unit in the same GSTIN.

(iv) Further, in cases where the other unit operating under same GSTIN, is supplying the inputs to the eligible unit as such or after manufacture , the credit availed by supplying unit on the inputs would have to be factored for determining the input tax credit of the eligible unit. The information in terms of para 5.9.2 of the scheme is required to be submitted by the eligible unit duly certified by a Chartered Accountant. The jurisdictional Deputy/Assistant Commissioner in such cases shall sanction the budgetary support after reducing input tax credit relatable to inputs used by the supplying unit under same GSTIN without payment of tax as certified by a Chartered Accountant.

(v) Para 5.8 of the scheme defines the scope of manufacture by the eligible unit. The eligible unit shall also indicate the value addition achieved by it in respect of each category of specified goods and where the value addition is higher than the limit provided in the table under the said para, the sanction of the claim shall be after verification of the value addition.

(vi) Para 6 of the scheme provides for inspection of the eligible unit by a team constituted by DIPP and the findings of the team shall be provided to the Deputy/Assistant Commissioner before sanction of the claim of budgetary support. However, in cases where inspection cannot be conducted the budgetary support amount may be sanctioned provisionally for a period of six months.

A separate circular on the manner of allocation of the budget by DIPP and direct transfer of the sanctioned amount into bank accounts of the beneficiaries through PFMS would be issued shortly. In the interim, trade facility may be issued to initiate the process of registration and receipt of application for payment of budgetary support for the quarter July, 2017 to September, 2017.