RECENT DEVELOPMENTS IN GST

[Dr. Sanjiv Agarwal]

We have moved to a new financial year, 2022-23 from 01.04.2022, an yet another necessary migration every year. The last fiscal 2021-22 was not so good but if we look at the Covid pandemic, it was already there with two variants or waves hitting India, former being more severe, former being more severe. It crippled the economy as was expected, and so tax revenue and GDP of countries. As of now, there appears to be no major threat or this front but new variants cannot be ruled out.

Finance Bill, 2022 has since been passed by both the houses of Parliament and assented by the President of India on 30^th March, 2022 to be called as Finance Act, 2022 (Act No. 6 of 2022). The new Act comes into force w.e.f. 01.04.2022. The provisions in relation to CGST shall be separately notified.

CBIC had issued Standard Operating Procedure (SOP) on scrutiny of returns which will facilitate smooth processes and procedures. Clarification has been issued on restoration of registration. Few new notifications have been issued in relation to building materials such as fly ash bricks, building bricks, roofing tills etc. E-invoicing becomes mandatory for more than ₹ 20 lakhs amount w.e.f. 01.04.2022.

Rating agency ICRA has lowered the GDP growth for financial year 2022-23 to 7.2% as it predicts lower demand revival due to Russia war, higher prices etc. RBI also echoes that our economy is on better position now. According to our Finance Minister, Budget initiatives and recovery are likes to sustain growth momentum in next few years.

GST investigations have recovered about ₹ 95 crores from 11 cryptos exchanges in the form of tax, penalty and interest.

There is an all time high Gross GST collection in March’2022, breaching earlier record of ₹ 1,40,986 crore collected in the month of January 2022. ₹ 1,42,095 crore  of gross GST revenue has been collected in the month of March, 2022. The gross GST revenue collected in the month of March 2022 is ₹ 1,42,095 crore of which CGST is ₹ 25,830 crore, SGST is ₹ 32,378 crore, IGST is ₹ 74,470 crore (including ₹ 39,131 crore collected on import of goods) and cess is ₹ 9,417 crore (including ₹ 981 crore collected on import of goods). The gross GST collection in March’2022 is all time high breaching earlier record of ₹ 1,40,986 crore collected in the Month of January 2022.

Finance Bill, 2022 enacted

• Finance Bill, 2022 has been enacted as Finance Act, 2022
• President of India has assented to the Finance Act, 2022 on 30.03.2022
• The Finance Act, 2022 shall be called Finance Act 2022 (Act No. 6 of 2022)
• Sections 100 to 118 contain amendments to CGST Act, 2017; Section 119 to 121 contain amendments to IGST Act, 2017 and Section 122 to 124 contain amendment to UTGST Act, 2017.

(Source: The Gazette of India, Finance Act, 2022 – No. 6 dated 30.03.2022)

Exemption from Registration under GST

• Notification No. 10/2019-Central Tax dated 07.03.2019 specifies the category of persons who are exempt from obtaining registration under CGST.
• Said notification has been amended to add persons engaged in supply of following goods also:

S.No.	Tariff Code	Descriptions
4.	6815	Fly ash bricks or fly ash aggregate with 90 per cent. or more fly ash content; Fly ash Blocks
5.	6901 00 10	Bricks of fossil meals or similar siliceous earths
6.	6904 10 00	Building bricks
7.	6905 10 00	Earthen or roofing tiles.

• This shall be effective from 01.04.2022.

(Source: Notification No. 3/2022-Central Tax dated 31.03.2022)

Opting for Composition Scheme

• CBIC has amended Notification No. 14/2019-Central Tax dated 07.03.2019 which provides for ineligibility to opt for composition levy of Tax 10(1)
• Accordingly, following persons, being manufacturer of following goods shall not be eligible for composition levy.

S.No.	Tariff Code	Descriptions
4.	6815	Fly ash bricks or fly ash aggregate with 90 per cent. Or more fly ash content; Fly ash blocks
5.	6901 00 10	Bricks of fossil meals or similar siliceous earths
6.	6904 10 00	Building bricks
7.	6905 10 00	Earthen or roofing tiles

• This shall come into force w.e.f 01.04.2022.

(Source: Notification No. 4/2022-Central Tax dated 31.03.2022)

Amendments on GST rate

• Notification No. 1/2022-Central Tax (Rate) dated 31.03.2022 has amended Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017.

• Following entries in Schedule I (2.5% CGST rate) have been omitted:

S.No.	Tariff Code	Item
225B	6815	Fly ash bricks or fly ash aggregate with 90 per cent. Or more fly ash content; Fly ash blocks
226.	6901 00 10	Bricks of fossil meals or similar siliceous earths
227.	6904 10 00	Building bricks
228.	6905 10 00	Earthen or roofing tiles

• Following entries in Schedule II (6% CGST rate) have been inserted :

S.No.	Tariff Code	Item
“176B	6815	Fly ash bricks or fly ash aggregate with 90 per cent. Or more fly ash content; Fly ash blocks
176C	6901 00 10	Bricks of fossil meals or similar siliceous earths
176D	6904 10 00	Building bricks
176E	6905 10 00	Earthen or roofing tiles”.

• These amendments will be effective from 1^st April, 2022.

(Source: Notification No. 1/2022-Central Tax (Rate) dated 31.03.2022)

Exemption to specified intra –state supplies

• Following  supplies of goods which are intra-state supplies have been exempted from so much of central tax levied u/s 9 of CGST Act, 2017, as is in excess of amount calculated at the rate in below Table (i.e. 3%) subject to condition :

S. No.	Tariff code	Description	Rate
1.	6815	Fly ash bricks or fly ash aggregate with 90 per cent. Or more fly ash content; Fly ash blocks	3%
2.	6901 00 10	Bricks of fossil meals or similar siliceous earths	3%
3.	6904 10 00	Building bricks	3%
4.	6905 10 00	Earthen or roofing tiles	3%

• Conditions for this exemption are :

(a) credit of input tax charged on goods or services used exclusively in supplying such goods has not been taken; and

(b) credit of input tax charged on goods or services used partly for supplying such goods and partly for effecting other supplies eligible for input tax credits, is reversed as if supply of such goods is an exempt supply and attracts provisions of sub-section (2) of section 17 of the Central Goods and Services Tax Act, 2017 and the rules made thereunder.

• This rate of 6% (3% CGST, 3% SGST) shall apply only to intra-state supplies and not inter-state.
• This shall come into force w.e.f. 01.04.2022.

(Source: Notification No. 2/2022-Central Tax (Rate) dated 31.03.2022)

GST Collection in March, 2022

• The gross GST revenue collected in the month of March 2022 is ₹ 1,42,095 crore of which CGST is ₹ 25,830 crore, SGST is ₹ 32,378 crore, IGST is ₹ 74,470 crore (including ₹ 39,131 crore collected on import of goods) and cess is ₹ 9,417 crore (including ₹ 981 crore collected on import of goods). The gross GST collection in March’2022 is all time high breaching earlier record of ₹ 1,40,986 crore collected in the Month of January 2022.
• The revenues for the month of March 2022 are 15% higher than the GST revenues in the same month last year and 46% higher than the GST revenues in March 2020. During the month, revenues from import of goods was 25% higher and the revenues from domestic transaction (including import of services) are 11% higher than the revenues from these sources during the same month last year.

(Source: Press Release ID 1812315 dated 14.03.2022)