Editors Insight March, 2019

GST Council in its 32nd meeting had taken several decisions relating to the MSME sector. Summary points of the decisions are herein below[1]:

       Higher exemption threshold limit for supplier of goods:

          There would be two threshold limits for exemption from registration and payment of GST for the suppliers of goods i.e. Rs 40 lakhs and Rs 20 lakhs. States would have an option to decide about one of the limits. The threshold for registration for service providers would continue to be Rs. 20 lakhs and in case of Special category States Rs. 10 lakhs.

       Composition scheme for services and mixed suppliers:

          A composition scheme shall be made available for suppliers of services (or mixed suppliers) with a tax rate of 6% (3% CGST + 3% SGST) having an annual turnover in preceding financial year upto Rs 50 lakhs.

       Increase in turnover limit for the existing composition scheme:

          The limit of annual turnover in the preceding financial year for availing composition scheme for goods shall be increased to Rs 1.5 crore. Special category States would decide about the composition limit in their respective States.

With respect to the above decisions, following notifications have been issued by CBIC:

(1)     Notification No. 10/2019 - Central Tax, dated 07.03.2019 for higher exemption threshold limit for supplier of goods and whose aggregate turnover in the financial year does not exceed forty lakh rupees;

(2)     Notification No. 02/2019 - Central Tax (Rate), dated 07.03.2019 for Composition scheme for services and mixed suppliers, which would be optional to the taxpayers;

(3)     Notification No. 14/2019 - Central Tax, dated 07.03.2019 for increase in turnover limit in case of existing composition scheme u/s 10 of the CGST Act, 2017 to Rs. 1.5 crores.

In this Edition, we bring to you two insightful articles.

India is one of the fastest growing economies across the globe with an expected growth rate of 7.5 percent[2] for fiscal 2019-20. Various incentives, including tax linked benefits, have been consistently deployed to stimulate growth of existing business operations and inducing fresh investments into the country. The first article “Key Government programs to incentivize business operations in India” discusses key incentive programs in operation today.

The second article “Advance ruling in GST – Boon or Bane?” gives an overview and scope of Advance Ruling as a mechanism under GST regime. It highlights the pros and cons and also recommendations to boost the image of AAR as an objective and fair institution for minimizing disputes.

To keep you up-to-date with the latest developments, short analysis of the latest releases given below for your ease of understanding:

Notification No. 14/2019-cental tax, dated 07.03.2019

Threshold limit for availing Composition Scheme increased to Rs. 1.5 Crore with effect from 01.04.2019

1.       Threshold limit for availing composition scheme has been increased to Rs.1.5 Crore of aggregate turnover in the preceding financial year for an eligible registered person. However, aforesaid threshold limit shall be Rs. 75 Lakh if an eligible registered person is registered in any of the eight specified States namely, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, and Uttarakhand.

2.       The registered person shall not be eligible to opt for composition levy if such person a manufacturer of any of the specified goods namely Ice cream and other edible ice, whether nor not containing cocoa, Pan masala and all goods i.e. i.e. tobacco and manufacturered tobacco substitutes.

3.       Supersession of Notification No. 08/2017-Central Tax, Dated 27.06.2017 [As amended from time to time] which used to deal with threshold limit for opting for composition levy with effect from 01.07.2017.

Notification No 13/2019-cental tax, dated 07.03.2019

Due dates of furnishing of monthly FORM GSTR-3B notified for each of the months from April, 2019 to June, 2019

1. Due dates of furnishing of monthly FORM GSTR-3B have been notified as under:

Period

Due Date of furnishing of FORM GSTR-3B

April, 2019

20.05.2019

May, 2019

20.06.2019

June, 2019

20.07.2019

2. Every registered person furnishing the return in FORM GSTR-3B shall discharge his liability towards tax, interest, penalty, fees or any other amount payable on or before the above-mentioned due date of furnishing of FORM GSTR-3B.

Notification No. 12/2019-cental tax, dated 07.03.2019

Due dates of furnishing of monthly FORM GSTR-1 notified for each of the months from April, 2019 to June, 2019 in respect of registered persons having aggregate turnover of more than Rs. 1.5 Crore

1. Due dates of furnishing of monthly FORM GSTR-1 have been notified as under:

Period

Due Date of furnishing of FORM GSTR-1 in respect of registered persons having aggregate turnover of more than Rs. 1.5 Crore in the preceding financial year or the current financial year

April, 2019

11.05.2019

May, 2019

11.06.2019

June, 2019

11.07.2019

2. The Time limit for furnishing of FORM GSTR-2 and FORM GSTR-3 for the months of July, 2017 to June, 2019 shall be notified subsequently.

Notification No. 11/2019-cental tax, dated 07.03.2019

Due date of furnishing of quarterly FORM GSTR-1 notified as 31.07.2019 for the quarter April to June, 2019 in respect of registered persons having aggregate turnover upto Rs. 1.5 Crore

1.       Due date of furnishing of quarterly FORM GSTR-1 has been notified as under:

Quarter

Due Date of furnishing of FORM GSTR-1 in respect of registered persons having aggregate turnover upto Rs. 1.5 Crore in the preceding financial year or the current financial year

April, 2019 to June, 2019

31.07.2019

2. The Time limit for furnishing of FORM GSTR-2 and FORM GSTR-3 for the months of July, 2017 to June, 2019 shall be notified subsequently.

Notification No. 10/2019-cental tax, dated 07.03.2019

Exemption from obtaining registration to any person engaged in exclusive supply of goods and whose aggregate turnover does not exceed Rs. 40 Lakh with effect from 01.04.2019

1.       Exemption from obtaining registration has been granted to any person who is engaged in exclusive supply of goods and whose aggregate turnover in the financial year does not exceed Rs. 40 Lakh However, none of the following persons shall be eligible for aforesaid exemption:

(a)     Persons required to take compulsory registration under section 24 of the CGST Act;

(b)     Persons engaged in making supplies of any of the specified goods namely Ice cream and other edible ice, whether or not containing cocoa, Pan masala and All goods i.e. tobacco and manufactured tobacco substitutes;

(c)     Persons engaged in making intra-State supplies in any of the 10 specified States or Union territories namely Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand; and

(d)     Persons exercising option of voluntary registration or such registered persons who intend to continue with their registration under the CGST Act.

Notification No. 02/2019-central tax(rate), dated 07.03.2019

Composition Scheme notified for supplier of services whose aggregate turnover did not exceed Rs. 50 Lakh with an effective tax rate of 6% and shall be applicable with effect from 01.04.2019

1.       Composition Scheme for supplier of services, whose aggregate turnover did not exceed Rs. 50 Lakh in the preceding financial year, has been notified. The aforesaid scheme shall be applicable with effect from 01.04.2019 subject to the satisfaction of detailed conditions given in the Notification.

2.       In computing aggregate turnover in order to determine eligibility of a registered person under composition scheme, value of supply of exempt services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount, shall not be taken into account.

We hope, the readers will find this newsletter interesting and we look forward to bring in more in the next edition.



[1]     PIB Release dated 7.03.2019