CBIC issued requirement for New LUT for the Financial Year 2019-2020

The CBIC vide Instruction No. 450/153/2017 – Cus IV dated April 30, 2020, which states that the exporters to submit a New LUT for the F.Y 19-20 while clearing export shipments. Therefore, vide Circular No. 137/07/2020-GST dated 13.04.2020, where the requirement under the GST Law for furnishing of any report, document, return, statement or such other record falls during between the period from 20.03.2020 to 29.06.2020, has been extended till 30.06.2020.

Therefore, in terms of Notification No. 35/2020-Central Tax, time limit for filing of LUT for the year 2020-21 shall stand extended to 30.06.2020 and the taxpayer can continue to make the supply without payment of tax under LUT provided that the FORM GST RFD-11 for the F.Y 2020-21 is furnished on or before 30.06.2020. Taxpayers may quote the reference no of the LUT for the year 2019-20 in the relevant documents. 

GST collections for April and May set to decline drastically

Goods and services tax (GST) collections are set to fall drastically in April and May with the number of electronic permits or e-way bills generated for transporting goods decreasing by close to 30% in March and by more than 80% in April sequentially, reflecting a general contraction in economic activities, according to official data. 

Businesses had generated only 6.7 million e-way bills from 1 to 27 April, against the 40.6 million generated in March, according to data available from GST Network (GSTN), the company that processes tax returns. The estimated more than 83% fall in e-way bills generated in April is set to have a telling effect on the GST revenue to be collected in May, which is slated to be reported on 1 June.

CBDT issued corrigendum to Circular No. 09/2020 to further clarifies the provision of Vivad Se Vishwas Act, 2020

The CBDT issued a corrigendum to Circular No. 9/2020 dated April 27, 2020, which further clarifies the provisions of the Direct Tax Vivad Se Vishwas Act, 2020 and answered some of the questions of the act are as under:-

1. in the answer to question number 1, for the word “Bill” read the word “Act”; and
2. in the answer to question numbers 26,28, 29, and 41 for the figures, letters, and word “31st March 2020”, wherever they occur, read the figures, letters, and word “30th June 2020”.

the complete circular can be accessed at: click here

CBIC notifies Form GST PMT-09 with effect from April 21, 2020

The CBIC vide Notification No. 37/2020-Central Tax dated April 28, 2020, which notifies the Form PMT – 09 effective from April 21, 2020. Now the taxpayers can transfer the cash balance available under one head to another head of tax i.e. from CGST to SGST or interest or penalty or vice versa.

The Notification can be accessed at: click here

Advisory issued by GSTN Portal on filing of FORM GST PMT 09

Taxpayers deposit money using challan and the paid amount gets credited in the particular head in the Electronic Cash Ledger and the same can be utilized in settling liabilities of that head only. In case a taxpayer deposited any amount under a major head i.e. IGST, CGST, SGST/UTGST and Cess or minor head i.e. Tax, Interest, Penalty, Fee and Others, they can then utilize this amount for discharging their liabilities only under that major head and minor head. Sometimes, inadvertently, the taxpayer pays the amount under the wrong head and it cannot be used to discharge the liabilities which may be due in another head. In such cases, taxpayers can claim the refund of the amount which may have been deposited under the wrong head in GST by filing a refund application in FORM RFD-01 under the category “Excess balance in electronic cash ledger”. The process of filing a refund claim and its disbursement can sometimes lead to blockage of funds for the taxpayer.

Form GST PMT-09 is now available on GST portal and it enables a taxpayer to make intra-head or inter-head transfer of amount available in Electronic Cash Ledger. A taxpayer can file GST PMT 09 for transfer of any amount of tax, interest, penalty, fee or others available under one (major or minor) head to another (major or minor) head in the Electronic Cash Ledger. Form GST PMT 09 provides flexibility to taxpayers to make multiple transfers from more than one Major/Minor head to another Major/Minor head if the amount is available in the Electronic Cash Ledger. To file Form GST PMT-09 taxpayers are required to log in on GST portal with valid credentials and navigate to Services > Ledgers > Electronic Cash Ledger > File GST PMT-09 For Transfer of Amount option. After Form GST PMT-09 is filed:

• ARN is generated on the successful filing of Form GST PMT-09.
• An SMS and an email is sent to the taxpayer on his registered mobile and email id.
• Electronic Cash ledger will get updated after successful filing of Form GST PMT-09.
• Filed form GST PMT-09 will be available for view/download in PDF format.

Coronavirus impact | Govt mulls 6-month pause on GST payments for affected sectors

Amid the nationwide lockdown, the government may provide a six-month freeze on goods and services tax (GST) as relief for most affected industries, according to a report by The Economic Times. India is currently in a nationwide lockdown to contain the spread of COVID-19. That only essential items and services can be provided during this period has hurt several sectors.

The pause on GST payments might be extended to industries such as aviation and hospitality, and a lower rate might be set for the real estate sector, the report said. Moneycontrol could not independently verify the story.

There is also a recommendation to move to a cash-based method of calculating tax from the existing invoice-based system, The Economic Times reported. The Centre may also provide GST relief on sales for which payments have been received during the lockdown by treating them as bad debts, the report said.

The government is also considering liquidity relief measures for cash-strapped businesses, the report said. “There is a thinking that for these service sectors, the government should at least spare its dues,” a government official told ET. The government may also waive other statutory charges on a temporary basis, the report added. The GST Council will make the final decision on the recommendations, the report said.

How you make your career on GST

• Career Opportunities

GST created a huge employment opportunities in Accounting, Taxation, Audit, Compliance and Finance sector. Number of registered businesses and taxpayers are increasing every month; so huge demand for tax practice & consulting.

• What we do

We bridge the gap between Academics to Industry. Students are trained and developed by Chartered Accountants & Industry Professionals through practical training & internship.

• Are you eligible

Any graduate or pursuing (fresher or experienced) is eligible to be professional in this field.

• Who am I

Ace Business Academy is in 32 years in this profession since 1988. The training certified by Netaji Subhas Open University.  We have our own accounting division KeepBooks- the Digital Accountants of India (www.keepbooks.in), Servicing in Accounts, GST, P Tax, PF, ESIC, ROC, Internal Audit sector. Students get practical training and opportunity to work with us.

Check our Instagram and Facebook pages regularly if you wish to stay updated.

GST-Career

Ace Business Academy

Address- 86D, Dr Suresh Sarkar Road, Moulali, Kolkata- 700014

Contact No- 9073323071/9073323073

WhatsApp No- 9073323071

Email ID- contact@teamace.co.in

Income Tax Departmet request taxpayers to respond E-mails to share info of pending refunds

As per recent tweet of Income Tax Department, the government says that we have issued almost 14 lakh refunds & are in the process of issuing more refunds, but need your help in clearing what’s pending from your side. A reminder email has been sent to you. Please, respond to it at the earliest so that you are able to receive your refund.

CBDT revising return forms to enable taxpayers avail benefits of timeline extension due to Covid-19

CBDT today said that in order to facilitate taxpayer to avail full benefits with various timeline extension up to 30th June 2020 granted by the government, it has initiated necessary changes in the return forms so that taxpayers could take benefits of their transactions carried out during the period from 1st April 2020 to 30th June 2020 in the return forms for FY 2019-20.

CBDT explained that the necessary modifications in the return forms are being made to allow taxpayers to avail of the benefits of their investments/transactions made for the Apr-to-Jun 2020 period. Once the revised forms are notified, it will further necessitate the consequential changes in the software and return filing utility. Hence, the return filing utility after incorporating necessary changes shall be made available by 31st May, 2020 to avail benefits for FY 2019-20.

CBDT said that due to outbreak of Covid-19, the Government has extended various timelines under the Income-tax Act,1961 vide Taxation and Other Laws (Relaxation of certain provisions) Ordinance, 2020. Accordingly, the time for making investment/ payments for claiming deduction under Chapter-VIA-B of IT Act which includes Section 80C (LIC, PPF, NSC, etc.), 80D (Mediclaim), 80G (Donations), etc. for FY 2019-20 has also been extended to 30th June 2020. Also, the dates for making investment/construction/purchase for claiming roll over benefit in respect of capital gains under sections 54 to section 54GB has also been extended to 30th June 2020. Therefore return forms are being revised to facilitate reporting of the transactions of the relief period.

This year also the e-filing utility for filing of return for Assessment Year 2020-21 was made available as on 1st April, 2020, and the Income-tax Return (ITR) Forms ITR-1 (Sahaj) and ITR-4 (Sugam) for the FY 2019-20 (Assessment Year 2020-21), too, were already notified vide notification dated 3rd January, 2020. However, to ensure that the taxpayer is enabled to avail of all benefits of the timeline extension due to Covid -19 pandemic, the ReturnFormsrevision is being carried out.

Key Highlights of RBI Governor Press Conference dated April 17, 2020

1. RBI is acting proactively

• RBI governor said that the RBI is doing everything to fight the epidemiological challenge that the world is facing.

2. To ensure financial system, RBI staff is working, being staying away from family

• RBI governor started his address by thanking RBI staff that has been working away to keep the financial system strong.

3. The economic situation has worsened

• The Economic situation has worsened since we last spoke, said RBI governor Das.

4. India to cling on to some growth

• India’s growth rate is expected to be highest among G20 nations, as per IMF estimates: Shaktikanta Das

5. Banks and other financial institutions have risen to the occasion: Das

• Banks, financial institutions have risen to occasion to ensure normal functioning during outbreak of pandemic: RBI Governor

6. Cumulative loss of $9 trillion to global GDP, estimated by IMF: RBI Governor

• Emerging markets are coping with sharp volatility in financial markets & exchange rates, RBI governor says.

7. India going through darkest moment

• It is our darkest moment and we should focus on light. – RBI Governor Shaktikanta Das

8. PMI contracted due to export hit

• Services PMI contracted due to a sharp downturn due to export hit. 25-30% sharp decline in electricity demand due to virus, says Das

9. Services PMI contracted due to a sharp downturn due to export hit

• Services PMI contracted due to a sharp downturn due to export hit. 25-30% sharp decline in electricity demand due to virus, said Shaktikanta Das

10. Banks have risen to the challenge by filling ATMs

• Commending the job done by Banks, RBI Governor said that banks have been doing a good job in maintaining cash in ATMs.

11. Contraction in exports much worse than in Global Financial Crisis 

• Contraction in exports at 34% has turned out to be much worse than in Global Financial Crisis, says RBI Governor Shaktikanta Das

12. Financial conditions have improved owing to steps taken by RBI.

• Financial conditions have improved, redemption pressure faced by mutual funds have moderated: Das

13. India’s growth is positive despite projection of global recession

• India among a handful of countries that are projecting positive growth – RBI Governor

14. RBI taking note of sectors that have had a problem reaching markets

• RBI has targetted sectors that have face difficulty in accessing the market or don’t have adequate liquidity.

15. RBI to start TLTRO 2.0

• TLTRO 2.0 will be started by the RBI, beginning with Rs 50,000 in tranches, to small and mid-size NBFCs and MFIs.

16. RBI announces TLTRO of Rs 50,000 crores

• RBI has decided for an aggregate amount of Rs 50,000 crore to begin in TLTRO, in tranches of appropriate sizes. – RBI

17. TLTRO 2.0 started by RBI

• Funds will be made available to small and mid-size firms and banks will have to disburse funds in a month’s time. The amount of Rs 50,000 core can be increased, said Das.

18. RBI’s capital infusion in NABARD, SIDBI, and NHB

• RBI has announced Rs 25,000 crore to NABARD; Rs 15000 crore to SIDBI for refinancing commercial banks, NBFCs, etc; and Rs 10,000 crore to NHB.

19. Banks must use 50% funds under TLTRO 2.0 to small and mid-size NBFCs

• Under the new TLTRO 2.0, lenders have to allocate 50% of the funds to mid and small size NBFCs, said Das.

20. RBI cuts reverse repo rate

• Reverse repo rate cut by 25 basis points from 4 per cent to 3.75 per cent.

21. Rs 6.9 lakh crore absorbed by RBI on April 15

• Das announced that Rs 6.9 lakh crore absorbed by RBI on April 15 by means of reverse repo rate.

22. RBI raises WMA limit for states

• RBI increases WMA limits by 60 per cent, to plan their market borrowings better. The facility will be available till September 30.

23. Reverse repo rate cut to 25 BPS to 3.75% from 4%

• The RBI has cut Reverse repo rate by 25 BPS to 3.75%

24. Reverse repo rate cut to encourage banks to lend

• The cut in reverse repo rate is to encourage banks to lend more, said RBI Governor Shaktikanta Das.

25. NPA classification will exclude the 3-month moratorium period

• Non-performing classification will exclude moratorium period said RBI Governor.

26. Banks must maintain 10% more provision

• To maintain the bank’s health, RBI said that the lenders will have to maintain 10% higher provisions on accounts, RBI governor Shaktikanta Das in his presser on Friday.

27. NBFCs allowed to relax NPA classification for borrowers under moratorium

• Banks must invest 50 percent of funds under TLTRO-2 to small, mid-sized NBFCs
• Banks will be required to maintain additional provisioning of 10% on standstill accounts
• 90-day NPA norm not to apply on moratorium granted on existing loans by banks
• Banks and cooperative banks shall not make any dividend payouts until further notice
• Banks must provide more for accounts availing moratorium

Note: Scheduled commercial banks and other financial institutions are to make additional 20 percent provision. Due to the challenges of resolutions of accounts, period of resolution will be increased by (further) 90 days. Extension of resolution timeline for large accounts under default, additional provisioning of 20 percent is required for not implementing resolution in 180 days. Relaxing additional 20 percent will be provisioned under June 7 circular. Banks need to conserve capital and absorb losses. Banks will not make dividend payout from FY20 until further notice

28. Liquidity coverage ratio requirement for banks being brought down to 80% from 100% with immediate effect, says RBI
29. NBFCs can extend realty loans by 1 year if projects delayed on reasons beyond control: RBI
30. RBI Governor Shaktikanta Das says, “For 2020-21, International Monetary Fund projects sizable reshaped recoveries, close to 9 percentage points for the global GDP. India is expected to post a sharp turnaround and resume its pre-Covid, pre-slowdown trajectory by growing at 7.4% in 2020-21.
31. Activity in corporate bond market has picked up: RBI Governor
32. WMA limit increased by 60 per cent till September 30

Coronavirus: MSMEs will need stimulus package, cut in GST to recover

The coronavirus outbreak has brought the world to a grinding halt. India too is fighting a life and death battle to flatten the curve. On April 14, Prime Minister Narendra Modi announced the extension of the lockdown across the nation till May 3, albeit with some relaxations.

The coronavirus pandemic is a unique situation. Governments across the world are grappling with the crisis and struggling to understand how to stop the global economy from falling into vicious economic traps. India is one such place where businesses are suffering and the spread of the virus has spelt doom for the entire ecosystem. The World Bank recently forecast India’s growth estimates between 1.5 percent and 2.8 percent whereas the International Monetary Fund (IMF) announced the growth estimate to stand at 1.9 percent for India following the impact of the pandemic and the lockdown.

More than 65 million micro, small, and medium enterprises (MSMEs) in the country form the backbone of the economy. The segment is in dire need of relief packages, support in working capital loans, and strengthening or fixing of supply chains which have been disrupted, among other needs. MSMEs in India are not only important for their contribution to the Gross Domestic Product (GDP) which is around 30 percent but also for mass employment they create.

Govt. plans income tax, GST refunds for large companies to ensure liquidity:

The government may soon provide refunds on income tax and goods and services tax (GST) to large companies, The Economic Times reported. The move is intended to ensure that large companies have adequate liquidity during the nationwide lockdown to contain the spread of COVID-19. The refunds will be higher than the Rs 18,000 crore given to small taxpayers, the report said. Moneycontrol could not independently verify the story. “Large cases (of refunds) will be dealt with after a week or 10 days, by which we will have issued refunds to small taxpayers,” an official told The Economic Times.

Though about 93 percent of all refund cases involved small taxpayers, where the amount is small, in the case of large companies it will be higher, the official said. The official added that the government is trying to process the refunds soon. On April 8, the finance ministry said it will immediately release pending income tax refunds of up to Rs 5 lakh. The total amount on such refunds was estimated at roughly Rs 18,000 crore, benefitting 14 lakh taxpayers. On April 15, the Central Board of Direct Taxes (CBDT) said over 10.2 lakh refunds worth Rs 4,250 crore had been issued within the week.

Income Tax Dept issued over 10.2 lakh refunds worth Rs. 4,250 Cr by Apr 14, 2020

As per the recent tweet of CNBC-TV18, sources say that the Government after giving directions to fast-track refunds, the Income Tax India Department says it issued over 10.2 lakh refunds worth Rs. 4,250 Cr by April 14, 2020.

• IT Dept Had Earlier Issued 2.50 Cr Refunds In F.Y19-20 Till March 31, 2020, Worth Rs 1.84 Lakh Cr
• IT Dept Aims To Issue 1.75 Lakh More Refunds This Week
• Refunds Processed Get Credited Directly To The Taxpayer Bank Account In 5-7 Business Days
• IT Dept Sent Emails To 1.74 Lakh Cases, Seeking Reconciliation Details Alert: Govt Had Issued Instructions To Fast-Track Refunds

Claim Refund (RFD-01) of GST paid on Advance received but Services not rendered due to Covid-19

The CBIC vide Circular No.137/07/2020 – GST, dated April 13, 2020, which clarified the challenges faced by the registered persons in adhering to the provisions of the Central Goods & Services Act, 2017 (“CGST Act”) on account of measures taken to prevent the spread of COVID-19. The following are the appended clarification made by the department are as under:-

Issue No. 01:-

An advance is received by a supplier for a Service contract which subsequently got cancelled. The supplier has issued the invoice before the supply of service and paid the GST thereon. Whether the supplier can claim a refund of tax paid or he is required to adjust his tax liability in his returns?

Clarification No. 01:-

In case GST is paid by the supplier on advances received for a future event which got cancelled subsequently and for which invoice is issued before the supply of service, the supplier is required to issue a “credit note” in terms of section 34 of the CGST Act. The supplier shall declare the details of such credit notes in the return for the month during which such credit note has been issued. The tax liability shall be adjusted in the return subject to conditions of section 34 of the CGST Act. There is no need to file a separate refund claim. However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.

Issue No. 02:-

An advance is received by a supplier for a Service contract which got cancelled subsequently. The supplier has issued receipt voucher and paid the GST on such advance received. Whether the supplier can claim a refund of tax paid on advance or he is required to adjust his tax liability in his returns?

Clarification No. 02:-

In case GST is paid by the supplier on advances received for an event which got cancelled subsequently and for which no invoice has been issued in terms of section 31 (2) of the CGST Act, the supplier is required to issue a “refund voucher” in terms of section 31(3)(e) of the CGST Act read with rule 51 of the CGST Rules, 2017. The taxpayer can apply for a refund of GST paid on such advances by filing FORM GST RFD-01 under the category “Refund of excess payment of tax”.