Last date to avail ITC extended to 30th Nov and other changes

The provisions of sections 100 to 114, except clause (c) of section 110 and section 111 of Finance Act, 2022 w.e.f. 1st October 2022 are notified via Notification No. 18/2022–Central Tax dated 28th September, 2022. The analysis of each section notified is below-

Section 100 : Amendment of section 16 (specifies the conditions for availing of input tax credit)

• New Clause (ba) is inserted

(ba) the details of input tax credit in respect of the said supply communicated to such registered person under section 38 has not been restricted;

• in clause (c) “or section 43A” is omitted, it will be read as

(c) subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and

• Last date for availing Input Tax Credit is now earlier of –
  • 30th November following the end of the financial year, or
  • the date of furnishing of the relevant annual return

in sub-section (4), for the words and figures “due date of furnishing of the return under section 39 for the month of September”, the words “thirtieth day of November” shall be substituted.

Section 101: Amendment of section 29 (Cancellation or suspension of registration)

• Registration of Composition taxpayer can be cancelled if return is not filed – in place of 3 tax period, return for a financial year beyond three months is substituted.

in clause (b), for the words “returns for three consecutive tax periods”, the words “the return for a financial year beyond three months from the due date of furnishing the said return” shall be substituted;

• Registration of any other person can be cancelled if return is not filed, 6 months time period removed.

in clause (c), for the words “a continuous period of six months”, the words “such continuous tax period as may be prescribed” shall be substituted.

Section 102: Amendment of section 34 (Credit and Debit notes)

Last date to issue credit note is now earlier of –

• 30th November following the end of the financial year, or
• the date of furnishing of the relevant annual return

Section 103: Amendment of section 37 (Furnishing details of outward supplies)

• Last date to make amendment in GSTR-1 is now earlier of –
  • 30th November following the end of the financial year, or
  • the date of furnishing of the relevant annual return

• Some other amendment to align with practical filing of GST Return are done.

• A new Sub-section is inserted

(4) A registered person shall not be allowed to furnish the details of outward supplies under sub-section (1) for a tax period, if the details of outward supplies for any of the previous tax periods has not been furnished by him:

Provided that the Government may, on the recommendations of the Council, by notification, subject to such conditions and restrictions as may be specified therein, allow a registered person or a class of registered persons to furnish the details of outward supplies under sub-section (1), even if he has not furnished the details of outward supplies for one or more previous tax periods.

Section 104: Substitution of new section for section 38 (Furnishing details of inward supplies)

For section 38 of the Central Goods and Services Tax Act, the following section shall be substituted, namely:–

38. Communication of details of inward supplies and input tax credit:

(1) The details of outward supplies furnished by the registered persons under sub-section (1) of section 37 and of such other supplies as may be prescribed, and an auto-generated statement containing the details of input tax credit shall be made available electronically to the recipients of such supplies in such form and manner, within such time, and subject to such conditions and restrictions as may be prescribed.

(2) The auto-generated statement under sub-section (1) shall consist of,-

(a) details of inward supplies in respect of which credit of input tax may be available to the recipient; and

(b) details of supplies in respect of which such credit cannot be availed, whether wholly or partly, by the recipient, on account of the details of the said supplies being furnished under sub-section (1) of section 37,-

(i) by any registered person within such period of taking registration as may be prescribed; or

(ii) by any registered person, who has defaulted in payment of tax and where such default has continued for such period as may be prescribed; or

(iii) by any registered person, the output tax payable by whom in accordance with the statement of outward supplies furnished by him under the said sub-section during such period, as may be prescribed, exceeds the output tax paid by him during the said period by such limit as may be prescribed; or

(iv) by any registered person who, during such period as may be prescribed, has availed credit of input tax of an amount that exceeds the credit that can be availed by him in accordance with clause (a), by such limit as may be prescribed; or

(v) by any registered person, who has defaulted in discharging his tax liability in accordance with the provisions of sub-section (12) of section 49 subject to such conditions and restrictions as may be prescribed; or

(vi) by such other class of persons as may be prescribed.

Section 105: Amendment of section 39 (Furnishing of returns)

• Non-resident taxable person will have to file GST Return by 13th of next month or within seven days after the last day of the period of registration, whichever is earlier.

(a) in sub-section (5), for the word “twenty”, the word “thirteen” shall be substituted;

• A new proviso added for Payment of Tax

in sub-section (7), for the first proviso, the following proviso shall be substituted, namely:-

Provided that every registered person furnishing return under the proviso to sub-section (1) shall pay to the Government, in such form and manner, and within such time, as may be prescribed,-

(a) an amount equal to the tax due taking into account inward and outward supplies of goods or services or both, input tax credit availed, tax payable and such other particulars during a month; or

(b) in lieu of the amount referred to in clause (a), an amount determined in such manner and subject to such conditions and restrictions as may be prescribed.

• No rectification will be allowed after 30th November , or the actual date of furnishing of relevant annual return, whichever is earlier.

(ii) in the proviso, for the words “the due date for furnishing of return for the month of September or second quarter”, the words “the thirtieth day of November” shall be substituted;

(d) in sub-section (10), for the words “has not been furnished by him”, the following shall be substituted, namely:–

or the details of outward supplies under sub-section (1) of section 37 for the said tax period has not been furnished by him:

Provided that the Government may, on the recommendations of the Council, by notification, subject to such conditions and restrictions as may be specified therein, allow a registered person or a class of registered persons to furnish the return, even if he has not furnished the returns for one or more previous tax periods or has not furnished the details of outward supplies under sub-section (1) of section 37 for the said tax period.

Section 106: Substitution of new section for section 41 (Claim of input tax credit and provisional acceptance thereof)

For section 41 of the Central Goods and Services Tax Act, the following section shall be substituted, namely:–

41. Availment of input tax credit:

(1) Every registered person shall, subject to such conditions and restrictions as may be prescribed, be entitled to avail the credit of eligible input tax, as self-assessed, in his return and such amount shall be credited to his electronic credit ledger.

(2) The credit of input tax availed by a registered person under sub-section (1) in respect of such supplies of goods or services or both, the tax payable whereon has not been paid by the supplier, shall be reversed along with applicable interest, by the said person in such manner as may be prescribed:

Provided that where the said supplier makes payment of the tax payable in respect of the aforesaid supplies, the said registered person may re-avail the amount of credit reversed by him in such manner as may be prescribed.

Section 107: Omission of sections 42, 43 and 43A:

• Section 42 – Matching, reversal and reclaim of input tax credit
• Section 43 – Matching, reversal and reclaim of reduction in output tax liability
• Section 43A – Procedure for furnishing return and availing input tax credit

Section 108: Amendment of section 47 (Levy of late fee):

In section 47 of the Central Goods and Services Tax Act, in sub-section (1),–

(a) the words “or inward” shall be omitted;

(b) the words and figures “or section 38” shall be omitted;

(c) after the words and figures “section 39 or section 45”, the words and figures “or section 52” shall be inserted.

Section 109: Amendment of section 48 (Goods and Services tax practitioners):

In section 48 of the Central Goods and Services Tax Act, in sub-section (2), the words and figures “, the details of inward supplies under section 38” shall be omitted.

Section 110: Amendment of section 49 (Payment of tax, interest, penalty and other amounts):

• changes –

(a) in sub-section (2), the words, figures and letter “or section 43A” shall be omitted;

(b) in sub-section (4), after the words “subject to such conditions”, the words “and restrictions” shall be inserted;

(c) for sub-section (10), the following sub-section shall be substituted, namely:-

(d) after sub-section (11), the following sub-section shall be inserted, namely:-

(12) Notwithstanding anything contained in this Act, the Government may, on the recommendations of the Council, subject to such conditions and restrictions, specify such maximum proportion of output tax liability under this Act or under the Integrated Goods and Services Tax Act, 2017 which may be discharged through the electronic credit ledger by a registered person or a class of registered persons, as may be prescribed.

Section 112: Amendment of section 52 (Collection of tax at source):

No such rectification in TCS return will be allowed earlier of-

• 30th November following the end of the financial year, or
• the date of furnishing of the relevant annual return

In section 52 of the Central Goods and Services Tax Act, in sub-section (6), in the proviso, for the words “due date for furnishing of statement for the month of September”, the words “thirtieth day of November” shall be substituted.

Section 113: Amendment of section 54 (Refund of tax):

• UNO etc need to make refund application before the expiry of 2 years from the last day of the quarter in which such supply was received.

• in the Explanation, in clause (2), after sub-clause (b), the following sub-clause shall be inserted, namely:–

(ba) in case of zero-rated supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit where a refund of tax paid is available in respect of such supplies themselves, or as the case may be, the inputs or input services used in such supplies, the due date for furnishing of return under section 39 in respect of such supplies;

Section 114: Amendment of section 168 (Power to issue instructions or directions):

In section 168 of the Central Goods and Services Tax Act, in sub-section (2), the words, brackets and figures “sub-section (2) of section 38,” shall be omitted.