GST Rulings Archives - Page 2 of 3 - Srinivasan V, Advocate

July 24, 2024August 4, 2024GST RulingsGST Refund

Which prevails for time limit to apply for GST refund – Notification 13/2022-CT (or) suo-motu extension granted by SC?

[dated 13.01.2023 , in Mangalore Refinery & Petrochemicals Limited v. Union of India, from Writ Petition No. 23995 of 2022 (T-RES)] Notification No.13/2022-Central Tax dated 05.07.2022 excluded the period from 01.03.2020 to 28.02.2022 for computation of limitation period for filing GST refund application. However, the Hon’ble Supreme Court, in Cognizance for Extension of Limitation 2022 […]

July 8, 2024July 31, 2024GST RulingsGST | E Way Bill, GST | Penalty

Penalty quantum for E-Way Bill violation

Section 129 does not require existence of mens rea to impose penalty. This has been watered-down, to an extent, with the issue of Circular No.64/38/2018-GST dated 14.09.2018, which specifies minimum penalty for minor offences. Yet, roving squad officers have been imposing maximum penalty for any violation under Section 129. Therefore, the judiciary has come to the rescue of innocent taxpayers from the clutches of Section 129.

June 6, 2024June 6, 2024GST RulingsGST | Burden of proof, GST | E Way Bill

Burden of proof for double movement on the same E Way Bill

Even if the dealer does not cancel the e-way bill within 24 hours of its generation, it would remain a matter of inquiry to determine on evidence whether an actual transaction had taken place or not. It is the duty of the authorities to ascertain whether double movement of goods had taken place.

May 29, 2024May 30, 2024GST RulingsCancellation of GST Registration

Can retrospective cancellation of GST registration be mechanical?

Registration cannot be cancelled with retrospective date covering the period when the returns were filed and the taxpayer was compliant. A consequence of cancelling registration with retrospective effect is that the taxpayer’s customers are denied the ITC availed in respect of the supplies made by the taxpayer during such period. Therefore, retrospective cancellation must be based on some objective criteria.

May 16, 2024May 22, 2024GST RulingsGST | Defect in Order, GST | Service of Notice

Fate of unsigned GST orders

Omission to sign the order cannot be covered under the safeguards of “any mistake, defect or omission” under Section 160 ibid. An unsigned order is no order in the eyes of law. Mere uploading of the unsigned order would not cure the defect related to validity of the order.

May 9, 2024May 9, 2024GST RulingsGST | Cross-examination, GST Input Tax Credit

Can cross-examination be refused for ITC denial on purchases from cancelled dealers?

Where ITC is denied on purchases from cancelled dealers, the taxable person should seek cross-examination of witnesses or authors of relied upon documents as a matter of right and use such opportunity judiciously. Denial of the right to cross-examine can cause grave and serious prejudice.

May 6, 2024May 7, 2024GST RulingsGST | Corporate guarantee, GST | Taxable Value, GST Taxable Supply

GST circular clarifying taxability of corporate guarantee stayed by P&H HC

CBIC clarification on taxability of corporate guarantee is stayed upon allegation that it forecloses discretion or judgment that may be exercised by the quasi-judicial authorities by clarifying provisions in the nature of adjudication.

April 26, 2024April 26, 2024GST RulingsGST | E Way Bill, GST | Penalty

No mens rea, no penalty for E-Way Bill violation: Calcutta HC

Penalty cannot be imposed under Section 129 of CGST Act if there is no intention to evade tax.

April 24, 2024April 26, 2024GST RulingsGST Input Tax Credit, GST Reverse Charge

Reverse charge mechanism & ITC denial to supplier – neither arbitrary nor discriminatory: Delhi HC

Imposing reverse charge mechanism to collect tax on some services cannot be challenged under Article 14. Also, ITC is available only if the statute permits and to the extent that it does. Denying ITC to service providers (who are not liable to pay tax on output services) is founded on a rational basis which has a clear nexus with the classification since such person has no liability against which ITC can be set off.

March 9, 2024April 26, 2024GST RulingsGST | E Way Bill, GST | Penalty

50% penalty levied for E-Way Bill violation without intent to evade taxes: SC

Appellant cannot shirk responsibility of generating fresh E Way Bill if consignment is delayed. But, the Supreme Court held that the order under Article 142 shall not be treated as precedent.

April 10, 2022April 26, 2024GST RulingsGST | Jurisdiction, GST | Proper Officer

Consequence of submitting to jurisdiction – Valuable lesson for GST Taxpayers

If a person has submitted to the jurisdiction of the authority, he cannot challenge the proceedings on the lack of jurisdiction of the said authority in further appellate proceedings. It is not a case that the state tax officer lacks inherent jurisdiction but it is a case where the jurisdiction has been exercised by the state tax officer in the absence of any objection or pointing out by the assessee that the case has been assigned to a central tax officer.

April 7, 2022April 7, 2022GST RulingsGST Exemption

Interpretation of Exemption Entry

The Hon’ble High Court of Gujarat observed[1] that an exemption entry should be liberally construed in accordance with the object sought to be achieved. That is, whether such provision is intended to grant incentive for promoting education or has some other beneficial reason behind it. The exemption notification should be given a literal meaning. Recourse […]

December 10, 2021December 11, 2021GST RulingsGST | Blocked Credit, GST | Sales Promotion, GST Input Tax Credit

GST ITC on goods/services procured for sales promotion

Assessee is a manufacturer of ghee and other food products. It procured certain goods / services (like televisions, air-coolers, gold coins, trips to Dubai, etc.). Such goods / services were awarded to its customers (viz., retailers) based on target quantity and value of purchases made by them. Hence, there was no consideration for such activities […]

September 24, 2021September 24, 2021GST RulingsForm GST TRAN1, GST Transitional Credit

Evidence not necessary to prove technical glitch in GST TRAN-1 filing

The Hon’ble High Court of Allahabad observed that there was no necessity under either the GST Act or the Rules to furnish evidence of attempt(s) to submit Form GST TRAN-1 or TRAN-2. Rather, this was done vide a Circular. Consequently, such action is arbitrary and unenforceable.

September 13, 2021September 13, 2021GST RulingsGST | Unutilised ITC, GST Inverted Rate Refund, GST Refund

Inverted Rate GST ITC Refund Allowed on Traded Goods

The Gauhati High Court observed existence of a conflict between Section 54(3) of CGST Act and Circular No.135/05/2020-GST. Consequently, it held that paragraph 3.2 of the aforesaid circular should be ignored. This ruling would be helpful especially for taxpayers who faced significant changes in tax rates during the first two years under the GST regime.

September 12, 2021September 16, 2024GST RulingsGST | Appeal, GST | Writ Petition

GST | When should a Writ Petition be Filed before the Jurisdictional High Court?

A writ petition can be entertained under exceptional circumstances like: (i) breach of fundamental rights; (ii) violation of principles of natural justice; (iii) excess of jurisdiction; and (iv) challenge to the vires of the statute or delegated legislation.

August 27, 2021August 28, 2021GST RulingsGST | Taxable Value, GST Input Tax Credit, GST Supply, GST Taxable Supply

ITC on Mandatory Canteen Facility Provided to Employees

Even if it is obligatory (under law) for the employer to provide canteen facility to its employees, ITC cannot be availed citing the proviso under Section 17(5)(b)(iii). Provision of canteen facility by the employer to the employee is a “supply” within the meaning of CGST Act.

July 17, 2021September 12, 2021GST RulingsCancellation of GST Registration, Suspension of GST Registration

GST Registration Cannot be in Suspended State Indefinitely

How can the cancellation proceedings be concluded if the registered person belatedly replies to the show-cause notice? What if the assessee altogether fails to reply to the show-cause notice? On purposive construction, it appears that if the registered person fails to reply within the stipulated time limit, the proper officer should conclude the cancellation proceedings within 30 days thereof.

May 19, 2021May 19, 2021GST RulingsGST Refund

Can Refund of Incorrect Head of GST, owing to Technical Glitch in GSTN Portal, be Rejected?

If the claim of refund was erroneously consolidated under the head of SGST owing to technical glitch in the GSTN portal, petitioner cannot be expected to produce any proof. In case of refund of un-utilised ITC, the order of debit is specified under paragraph 37 of Circular No.125/44/2019-GST. Paragraph 38 thereto provides relief that for applications where such order is not adhered to, no adverse view may be taken by the tax authorities.

February 13, 2021February 13, 2021GST RulingsGST | Provisional Attachment

Can Bank Account Held Jointly with Third Party be Provisionally Attached?

Section 83 of CGST Act permits provisional attachment of property belonging only to the taxable person. In instances where bank account (jointly held with third party) is attached, the aggrieved (third) party should duly file their objections under Rule 159(5) ibid and may seek judicial remedy if there is no response or belated response on the part of Revenue.

February 10, 2021February 10, 2021GST RulingsGST | Excess Payment, GST | Limitation Period, GST Refund

Can Refund of Erroneous / Excess Payment of Tax be Obtained Without Limitation?

Background: The petitioner paid certain dues through web portal. However, due to failure of web portal system, receipt was not generated. Hence, it was forced to again pay the dues. It applied for refund of the dual payment. The statute (Section 19 of Lighthouse Act, 1927) provided that where Light Dues were paid more than […]

December 11, 2020December 12, 2020GST RulingsGST | Non-Supplies, GST Taxable Supply

Are Variable Payments to Whole Time Directors Liable to GST?

Whole-time directors were paid remuneration in the form of commission (based on percentage of profits). The Revenue demanded service tax on such variable pay. A whole-time director is one who is in full-time employment of the company, for which he is entitled to receive remuneration. Hence, it was held[1] by the Hon’ble CESTAT (Kolkata) that […]

December 10, 2020December 10, 2020GST RulingsGST | Appeal, GST | Provisional Attachment

GST Provisional Attachment: Can Entire GST Demand be Recovered During Limitation Period of Appeal?

The Revenue authorities instituted recovery proceedings and recovered the entire amount of demand within three months from the date of order of the first appellate authority (which had ruled in favour of the Revenue). It appears such recovery was on the strength of a subsisting provisional attachment. However, the assessee had the right to appeal […]

November 19, 2020November 29, 2020GST RulingsGST | Unutilised ITC, GST Refund

Can SEZ Unit Claim Refund of GST Input Tax Credit on Exports?

The appellant is a unit operating in the Special Economic Zone (SEZ). It is engaged in export of goods. It availed input tax credit (ITC) on inward supplies from entities in the Domestic Tariff Area (DTA). The SEZ unit applied for refund of un-utilised ITC. Such accumulation arose on account of export of goods. The […]

October 17, 2020September 12, 2021GST RulingsGST Input Tax Credit

GST Input Tax Credit on ‘Buy One, Get One Free’ Offer

Usually, business entities in the Fast-Moving Consumer Goods (FMCG) sector announce ‘buy one, get one free’ offers / schemes. These are directed towards better sales traction. Barring activities or transactions specified in Schedule I of the CGST Act, goods or services supplied free of cost (that is, without consideration) are not treated as ‘supply’ under […]

Srinivasan V, Advocate

FCA, LL.B. (Hons.)

Category: GST Rulings