Recent Changes in GST

The GST regime changing so fast, that to keep up with every update is being impossible for everyone. We have compiled and represented the Recent Changes in GST. Following are the recent changes:

IGST (Amendment) Act 2018 -No. 32 of 2018, 29th Aug 2018

01/2019-Integrated Tax, dt. 29-01-2019
• Seeks to bring into force the IGST (Amendment) Act, 2018

Export of Services to Nepal & Bhutan Up to 31/01/2019 – Exempted

The Central Government vide Notification No. 42/2017- Integrated tax(Rate) dated 27th October, 2017 made the amendment in the Notification No.9/2017- Integrated Tax (Rate),dated the 28th June, 2017 whereby a new entry 10D have been inserted in the exemption notification, namely, Supply of services having place of supply in Nepal or Bhutan, against payment in Indian Rupees.

Eligibility of ITC in case of Export of Services to Nepal and Bhutan Exports of services to Nepal and Bhutan have already been exempted from GST. GST Council has decided that such exporters will also be eligible for claiming Input Tax Credit in respect of goods or services used for affecting such exempt
supply of services to Nepal and Bhutan.

[Press release on Policy issues dated 10th November 2017]
Rule 43 (2)

Export of Services to Nepal & Bhutan w.e.f 1st Feb 2019 – Exemption is withdrawn 02/2019-Integrated Tax (Rate), Dated 04-02-2019

Seeks to rescind Sl. No. 10D of Notification No. 09/2017-Integrated Tax (Rate) dated 28.06.2017 in relation to exemption of IGST on the supply of services having the place of supply in Nepal or Bhutan, against payment in Indian Rupees.

Export of Services
Sec 2(6) “export of services” means the supply of any service

when,––

(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8;

01/2019-Integrated Tax (Rate), dt. 29-01-2019
• Seeks to rescind notification No. 32/2017 – Integrated Tax (Rate) dated 13.10.2017 in view of bringing into effect the amendments (regarding RCM on supplies by unregistered persons) in the GST Act

32/2017-Integrated Tax (Rate), dt. 13-10-2017

Seeks to exempt payment of tax under section 5(4) of the IGST Act, 2017 till 31.03.2018.

Amendment of section 5 of IGST Sec 5(4)

• “The Government may, on the recommendations of the Council,
• by notification, specify a class of registered persons who shall,
• in respect of the supply of specified categories of goods or services or both received from an unregistered supplier,
• pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.”.

Related Topic:
How to do Export to Nepal & Bhutan in GST

Amendment of section 12(8) of IGST

The place of supply of services by way of transportation of goods, including by mail or courier to,––

(a) a registered person, shall be the location of such person;
(b) a person other than a registered person, shall be the location at which such goods are handed over for their transportation.

• Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods.

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Amendment of section 13(3) of IGST

• (3) The place of supply of the following services shall be the location where the services are actually performed, namely:—

• (a) services supplied in respect of goods which are required to be made physically available by the recipient of services to the supplier of services, or to a person acting on behalf of the supplier of services
in order to provide the services:

• Provided that …………

• Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs or for any other treatment or process and are exported after such repairs or treatment or process without being put to any use in India, other than that which is required for such repairs or treatment or process;

Goods sold while being in a Custom BondedWarehouse

• The Central Board of Excise & Customs vide Circular No. 46/2017- Customs dated 24th November, 2017clarified that goods imported and deposited in a custom bonded warehouse will be chargeable to (Custom duty + IGST) at the time of filing of ex-bond bill of entry at the value determined at the time of filing into-bond bill of entry to be collected at ex-bond stage.

• Circular No. 3/1/2018-IGST Dated the 25th May, 2018 clarified that integrated tax shall be levied and collected at the time of final clearance of the warehoused goods for home consumption i.e., at the time of filing the ex-bond bill of entry and the value addition accruing at each stage of supply shall form part of the value on which the integrated tax would be payable at the time of clearance of the warehoused goods for home consumption.

Goods sold while being in a Custom Bonded Warehouse

Circular No. 46/2017-Customs dated 24th November, 2017
Circular No. 3/1/2018-IGST Dated the 25th May, 2018

New Circular No. 04/01/2019-IGST Dated the 1st Feb, 2019

• The provisions of the CGST (Amendment) Act, 2018 and SGST Amendment Acts of the respective States have been brought into force w.e.f. 01.02.2019. Schedule III of the CGST Act, 2017 has been amended vide section 32 of the CGST (Amendment) Act, 2018 so as to provide that the “supply of warehoused goods to any person before clearance for home consumption” shall be neither a supply of goods nor a supply of services.

• Accordingly, Circular No. 03/01/2018-IGST dated 25th May 2018 is hereby rescinded.

CA Mukesh Sharma