GST – Weekly Updates – 17.07.2021 CA Vaishali Kharde (Founder and CEO of VBK and Company) Overview GST Export Benefits Areas Covered - GST Weekly Updates Key Highlights Ongoing Litigation Key Pronouncements Advance Ruling Key Highlights Taxpayers with canceled registration can also apply for Amnesty Scheme the Finance Ministry is contemplating to restore the registration of taxpayers whose registration has been canceled due to non - filing of returns. There are more than 8 lakh such cancelled registration Thus, taxpayers with canceled registration can also apply for Amnesty Scheme What is Amnesty Scheme • Non - furnishing FORM GSTR - 3B Taxpayer Covered • July, 2017 to April, 2021 Available for period • If GSTR - 3B returns for these tax periods are furnished between 01.06.2021 to 31.08.2021. Condition • INR 500 per return Caping of late fee if Nil Return • INR 1000 per return Caping of late fee for other Relief Key Highlights File return within time limit to get relief Available only if GSTR - 3B returns for these tax periods are furnished between 01.06.2021 to 31.08.2021. What about Genuine Taxpayer who had paid late fee and filed return Ongoing Litigation Swiggy fined Rs. 20K for levying GST on MRP Abhishek Garg – A Consumer Complaint • Facts • On August 4, 2018, the complainant placed an online order on Swiggy’s app for two items cheesy garlic stick and three 500ml Coca Cola bottles (each having an MRP of Rs. 30) • Swiggy had charged an additional Rs. 4.50 GST (five percent) on three 500ml bottles having total MRP of Rs. 90 • Then on May 31, 2019, the complainant approached the district consumer forum with his grievance. Swiggy fined Rs. 20K for levying GST on MRP Abhishek Garg – A Consumer Complaint • Facts • Swiggy defended itself by saying it acts as an intermediary and a medium to restaurants/merchants to sell their products to users on its platform. • “All applicable taxes and levies, the rates thereof and the manner of applicability of such taxes on the bill are being charged and determined by merchants. So, there is no deficiency in service and unfair trade of practice on its part, ” Swiggy fined Rs. 20K for levying GST on MRP Abhishek Garg – A Consumer Complaint • Conclusion • The forum concluded that Swiggy can’t defend itself by saying that it has no role to play in the entire transaction of the sale and purchase of food between the complainant and the restaurant. • Way Forward • MRP includes all taxes. Thus, before paying any taxes on product check correctness of taxes. Key Pronouncements GST applicable on amount exceeding INR7,500 collected by RWA Case • Greenwood Owners Association [2021 - TIOL - 1505 - HC - MAD - GST] Issue ▪ If the monthly contribution by members is 10,000 then, will GST be applicable on Rs. 10,000/ - or Rs.2,500/ - Exemption Available • Notification No. 12/2017 - CT (R) at Sr. No.77 – '' Service by an unincorporated body or a non - profit entity registered under any law for the time being in force, to its own members by way of reimbursement of charges or share of contribution – (a) ...; (b) for the provision of carrying out any activity which is exempt from the levy of Goods and service Tax; or (c) up to an amount of seven thousand and five hundred rupees per month per member for sourcing of goods or services from a third person for the common use of its members in a housing society or a residential complex Exemption for CHS Till 25 th January 2018 On or after 25 th January 2018 5,000 7,500 [Refer Not. 2/2018 – CT(R) GST applicable on amount exceeding INR7,500 collected by RWA AAR if the amount collected by a registered housing society/resident welfare association exceeds ₹7,500 per month per flat, Goods and Services Tax of 18% is payable on the entire amount and not on the difference amount. Circular No.109/28/2019 - GST The exemption from GST on maintenance charges charged by a RWA from residents is available only if such charges do not exceed Rs. 7500/ - per month per member. In case the charges exceed Rs. 7500/ - per month per member, the entire amount is taxable GST FLYERS Exemption is available up to an amount of Rs.5, 000/ and GST would be applicable on the amount in excess of Rs.5, 000/ - GST applicable on amount exceeding INR7,500 collected by RWA Observation • In the case of Dilip Kumar (supra), the Supreme Court reiterates the settled proposition that an Exemption Notification must be interpreted strictly. The plain words employed in Entry 77 being, ' upto ' an amount of Rs.7,500/ - can thus only be interpreted to state that any contribution in excess of the same would be liable to tax. [Para 23] • The term ' upto ' hardly needs to be defined and connotes an upper limit. It is interchangeable with the term 'till' and means that any amount till the ceiling of Rs.7,500/ - would exempt for the purposes of GST. [ Para 24] GST applicable on amount exceeding INR 7,500 collected by RWA Decision • The discussion as above leaves me no doubt that the conclusion of the AAR as well as the Circular to the effect that any contribution above Rs.7,500/ - would disentitle the RWA to exemption, is contrary to the express language of the Entry in question and both stand quashed. To clarify, it is only contributions to RWA in excess of Rs.7,500/ - that would be taxable under GST Act. Our Comment • Revisit exemption availed. Advance Rulings