SEPTEMBER 18, 2018

By Shailesh Sheth, Advocate

RULE 138A - E-way Bill in case of imports -

Following additional proviso is inserted in sub-rule (1) of Rule 138A of the CGST Rules:

"Provided further that in case of imported goods, the person in-charge of a conveyance shall also carry a copy of the bill of entry filed by the importer of such goods and shall indicate the number and date of the bill of entry in Part A of FORM GST EWB-01."

The proviso has come into effect from September 04, 2018.

Comments:

Rule 138A has been inserted in the CGST Rules vide the CGST (Second Amendment) Rules, 2018 as notified vide Notification No. 12/2018-CT dated 07.03.2018. Sub-rule (1) of Rule 138A requires the person in charge of the conveyance to carry, inter alia, a copy of the e-way bill in physical form or the e-way bill number in electronic form or mapped to a Radio Frequency Identification Device embedded on to the conveyance in such manner as may be notified by the Commissioner.

With the insertion of the above proviso, it is now provided that in case of the imported goods, a person in-charge of a conveyance shall also carry a copy of the bill of entry filed by the importer. Moreover, the number and date of the bill of entry shall also be indicated in Part A of FORM GST EWB-01.

Job work - Form GST ITC-04 - Made comprehensive and simple

Form GST ITC-04 prescribed in terms of Rule 45(3) of the CGST Rules has been substituted by a new Form.

The new Format has been made effective from September 04, 2018.

Comments:

Rule 45 of the CGST Rules prescribes the conditions and restrictions in respect of inputs and capital goods sent to the job worker. Sub-rule (3) of Rule 45 requires the details of challans in respect of goods dispatched to a job worker or received from a job worker or sent from one job worker to another during a quarter to be included in Form GST ITC-04 prescribed hereunder.

The prescribed Form GST ITC-04 is now substituted by a new Format. On comparison of the erstwhile Format and the substituted one, it will be observed that the new Format has been made quite comprehensive and as simple as possible at the same time. The earlier Format did not specifically provide for the inclusion of details of the inputs/capital goods directly sent to the job worker. In the new Format, it is now specifically provided to include these details as part of the details of inputs/capital goods sent for job work (col.4 refers).

It may also be noted that the details of 'nature of job work done by the job worker' are also now prescribed and required to be indicated in the new Format.

Further, the following details are now required to be indicated in a segregated manner viz:

i) Details of inputs/capital goods received back from job worker (col.5(A) refers);

ii) Details of inputs/capital goods received back from job worker, other than the original job worker (col.5(B) refers);

iii) Detai ls of inputs/capital goods sent to job worker and subsequently supplied from the premises of job worker (col.5(C) refers).

In all these cases, the details of losses and wastes arising during the course of job work are required to be indicated. In the erstwhile Format, the details relating to losses and wastes were not prescribed. The requirement of indicating the details of losses and wastes arising at the job worker's premises may pose practical difficulties to the registered person i.e. the supplier of the inputs/capital goods for the job work.

Annual Return - Forms 9 and 9A prescribed - Annual pain returns!

Separate Formats of the Annual Return are prescribed in terms of Rule 80 of the CGST Rules for the normal taxpayers and the composition taxpayers. For the normal taxpayers, Form GSTR-9, whereas, for the composition taxpayers, Form GSTR-9A has been prescribed.

The new Formats are made operational from September 04, 2018.

Comments:

Rule 80(1) of the CGST Rules requires every registered person, other than an ISD, a person paying under Section 51 or Section 52, a casual taxable person and a non-resident taxable person, to furnish an annual return as specified under Section 44(1) of the CGST Act in Form GSTR-9. Proviso to sub-section (1) provides that a composition taxpayer shall furnish the annual return in Form GSTR-9A. However, even though more than one year elapsed since the introduction of GST, the formats of annual return were not prescribed.

Now, after an agonising long wait, the Central Government has finally notified the Formats of annual return in Form GSTR-9 and GSTR-9A for the normal taxpayers and the composition taxpayers respectively. A quick glance at both the formats shows that more agony appears to be in store for the taxpayers! Only a few examples will say it all:

++ Table 6 of GSTR-9 requires taxpayers to indicate the details of ITC separately for the inputs, capital goods and input services. It shall however, be noted that such segregation is not required nor prescribed in GSTR-3B. Consequently, a taxpayer will have to make such bifurcation so as to fill in GSTR-9.

++ Table 18 of GSTR-9 requires the taxpayers to report HSN-wise details of the inward supplies. Again, such HSN-wise details for inward supplies are not required to be indicated in GSTR-3B. The taxpayers will have a harrowing time preparing the HSN-wise details of all its inward supplies. It is also rather strange that Table 18, as such, does not require the HSN-wise details of inputs, input services and capital goods separately. However, since the Table 18 relates to the 'HSN-wise summary of inward supplies', the details will be required to be given separately for all the three types of inward supplies.

++ At column H of Table 6, the details of 'amount of ITC reclaimed under the provisions of the Act' are required to be indicated. Thus, if the taxpayer has reclaimed the ITC which he had earlier reversed due to non-payment to the supplier within the prescribed period of 180 days, these details will be required to be mentioned separately in this column. It is pertinent to note here that such reclaimed ITC is not being indicated separately in the GSTR-3B.

The above are but only the few examples which would give an idea to the taxpayers about the intricacies of the details required to be indicated in the annual return. It is rather unfortunate that the proposed formats of the annual return were not released for the public debate and feedback though, the Board has taken its own sweet time (more than a year!) to come out with the Formats. By no means, the preparation and furnishing of the annual returns in the Formats as prescribed will be an easier task for the taxpayers, particularly the taxpayers in the MSME Sector.

It appears that chaos, confusion and consternation will rule in coming months!

(Kindly note: While this Part was being finalised, the Central Government has further amended CGST Rules, 2017 by the CGST (Tenth Amendment) Rules,2018 vide Notification No. 49/2018-CT dated 13/09/2018 prescribing the Formats of Reconciliation (FORM GSTR-9C) and Certification by the auditors for the purposes of Rule 80(3) of the CGST Rules, 2017. More on this and the CGST (Amendment) Act, 2018 in the coming days.)

(The author is founder of M/s SPS Legal and the views expressed are strictly personal.)

Editor: The three part series stands concluded. See Part I & Part II.