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Indirect Tax News

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IDT Developments and Associated Procedures

1. Finance Bill, 2022 receives Presidential Assent on 30 March 2022

The Finance Bill 2022 was presented by Hon'ble Finance Minister in Lok Sabha on  1 February 2022 has received Presidential assent on 30 March 2022. It may be noted that the changes which were introduced under the GST laws are now a part of the respective legislations, the same would be made effective from a date to be notified later whereas the other changes under Customs & Excise Regulations would be effective from the date of the relevant Notification unless otherwise stated.


2. The Hon'ble Supreme Court decides the matter on classification of 'relays' solely meant for use in railways 

The Larger Bench of Hon'ble Supreme Court in case of Westinghouse Saxby Farmer Ltd. [TS-74-SC-2021-EXC] held that 'relays' solely meant for use in railway signalling equipment would merit classification under heading 8608 and not individually as relays under Heading 8536. Post the said ruling, CBIC has come out with Instruction No. 02/2022-Customs dated January 05, 2022, to discuss the implication of the SC judgment due to divergent practices being adopted by the trade and formations in assessment of 'automobile parts'. 


3. The Hon'ble High Court upheld that the Commissioner of GST does not have the power to permit payment of tax in instalments

The Hon’ble Kerala High Court in case of Muhammed Basheer [2022-TIOL-406-HC-Kerala-GST] has upheld that though Section 80 of the CGST Act confers power upon the Commissioner to extend the time for payment, the said benefit is limited for payments other than those due under self-assessed returns.  In cases of self-assessed returns, the Commissioner of GST does not have the power to permit payment of tax in instalments.


Important GST Notifications and Circulars issued during the Quarter

1. Applicability to e-invoicing to the taxpayers having aggregate turnover exceeding INR 200 million

Vide Notification No. 01/2022-Central Tax dated 24 February 2022, the applicability of e-invoicing provisions to the taxpayers having aggregate turnover exceeding INR 200 million in any preceding financial years has been made effective from 1 April 2022.

 

Due to the above, taxpayers (except for certain specified category) with a turnover of above INR 200 million will have to generate an electronic invoice from the E-Invoice portal for B2B and export transactions (including corresponding debit and credit notes) and mention the IRN in their sales invoices. The threshold was INR 500 million till 31 March 2022. 


2. Appointment of Common Adjudicating authority for adjudicating the show cause notices issued by DGGI under GST

Vide Notification No. 02/2022-Central Tax dated 11 March 2022, Para 3A has been inserted in the Notification No. 2/2017-Central Tax dated 19 June 2017, to empower  Additional Commissioners of Central Tax / Joint Commissioners of Central Tax of some of the specified Central Tax Commissionerates, with All India Jurisdiction for the purpose of  adjudication of the show cause notices issued by the officers of the Directorate General of Goods and Services Tax Intelligence.


Customs and Foreign Trade Policy related Developments

1. Introduction of Shipping Bill (Post Export Conversion in relation to Instrument based Scheme) Regulations, 2022 ('Shipping Bill Conversion Regulations')

The Ministry of Finance has issued the Shipping Bill Conversion Regulations vide Notification No. 11/2022-Cus. (N.T.) dated 22 February 2022 in view of the third provision to Section 149 of the Customs Act and the same is made effective from 22 February 2022.

 

Shipping Bill Conversion Regulations apply to shipping bills or bills of export wherein the exporter intends to convert the shipping bill/ bill of export filed and avail an instrument based scheme under the Foreign Trade Policy 2015-2020. Conversion means amendment of the declaration made in the shipping bill or bill of export after the goods have been exported. The detailed procedure, time limit and terms and conditions are given in the notification issued in this regard.


2. Introduction of Customs (Electronic Cash Ledger) Regulations, 2022

Vide Notification No. 20/2022 dated 30 March 2022, the CBIC has introduced the Customs (Electronic Cash Ledger) Regulations, 2022.

 

The regulations envisage developing of a common portal for each person in regard to every deposit made towards duty, interest, penalty, fee, cess, surcharge or any other sum payable by the person under the provisions of the Customs Tariff Act, 1975 or the rules and regulations for the time being in force. The manner of maintaining the cash ledger, manner of payment, refund, etc are given in detail in the notification issued in this regard.

 

Further, vide Notification No. 19/2022 dated 30 March 2022, the CBIC has also issued a list of exempted deposits with respect to ports where automated system is not in place, accompanied baggage, etc. and such notification would come into force from 1 June 2022.


3. Implementation of automation in the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 with effect from 01st March 2022

Vide Notification No. 07/2022-Customs (N.T.) dated 1 February 2022 , certain amendments are made in existing Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 ("IGCR Rules 2017"). These changes come into effect from 1 March 2022.


Vide Circular No 04/2022-Customs dated 27 February 2022, the CBIC has given a detailed procedure for implementation of the amended provisions in IGCR Rules, 2017. The amendments are aimed at simplifying the procedures with a focus on automation and making the entire process paper-less.


4. Extension of exemption from payment of GST and Compensation Cess for imports by EOU unit or import against Advance Authorization (AA) / Export Promotion Capital Goods (EPCG)

Vide Notification No. 18/2022-Cus and 19/2022-Cus each dated 31 March 2022, the benefit of exemption from payment of GST and Compensation Cess for imports made by EOU unit and AA / EPCG license holder is further extended up to 30 June 2022.


5. Extension of Foreign Trade Policy 2015-2020 (FTP 2015-2020)

Vide Notification No 64/2015-2020 dated 31 March 2022, the FTP 2015-2020 which was valid up to 31 March 2022 has been extended further till 30 September 2022. Accordingly, all provisions and schemes under the FTP stand extended till such time.


6. Extension of last date for submission of applications under certain Scrip based Schemes

Vide Notification No. 58/2015-2020 dated 7 March 2022, the last date for submitting applications under MEIS for exports made during the period 1April 2020 to 31 December 2020 and 2 per cent additional ad hoc incentive under para 3.25 of the FTP for the exports made during the period 1 January 2020 to 31 March 2020 has been extended till 30 April 2022.

 

Further, due date of filing applications under ROSCTL and ROSL was also extended up to 15  March 2022.

 From The Newsletter

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