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Supply to goods for Job Work, have you filed your ITC-04
Input Tax Credit
CA. Sachin Jindal

Supply to goods for Job Work, have you filed your ITC-04

Job work is an indispensable part of the business and most of the manufacturing entities are required to get their work done from the job worker on a regular basis. However, whether it is Central Excise, Service tax or Goods and Service Tax, special provisions are always provided under the law for goods sent on job work basis.

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Demand order in Form GST DRC-07 is not sustainable when order is issued in Form GST ASMT-12
Judgements
CA. Sachin Jindal

Demand order in Form GST DRC-07 is not sustainable when order is issued in Form GST ASMT-12

Since commencement of Assessments under GST, there are many practical issues which are being faced by the Assessee. One of the common issues is issuance of GST ASMT-10 and DRC-01 for the same matter. There are many instances wherein a proper officer issues the GST ASMT-10 and assessee obtains the GST ASMT-12 by filing proper reply. GST authority still issues show cause notice in Form GST DRC-01 and in some cases issues the demand order as well. In this matter, a major relief is granted by Hon’ble High Court of Madra in the matter of Radiant Cash Management Services Ltd., Vs. The Assistant Commissioner (ST) (W.P.No .2981 of 2024 and  W.M.P.Nos.3246 & 3247 of 2024).

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ITC is ineligible in relation to construction work of immovable property which is further let out
Input Tax Credit
CA. Sachin Jindal

ITC is ineligible in relation to construction work of immovable property which is further let out

The Company constructed a warehouse and let it out. The Company paid the GST on such outward supply. The Company sought an advance ruling from WBAAR that whether the company is entitled to claim ITC on inward supplies received for construction of such warehouse. The Hon’ble WBAAR held that the restriction given under Section 17(5)(d) of CGST Act in respect of ITC on goods or services used for construction of warehouse is applicable in the instant case, i.e., the Company is not eligible for ITC with respect to inward supplies to the extent such expenditure is capitalised. However, where construction expenses are not capitalized in books, the claim of ITC is admissible.

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GST Authorities can’t transgress the boundaries of the Show Cause Notice
Judgements
CA. Sachin Jindal

GST Authorities can’t transgress the boundaries of the Show Cause Notice

The Petitioner received an order for imposition of penalty. Show Cause notice was issued on the ground that the vehicle was traveling to a destination not mentioned in the invoice. However, while issuing the order, the appellate authority has imposed a penalty on a different ground.Hon’ble High Court held that “Show Cause Notice” serves as a vital checkpoint which defines the boundaries within which any authority can operate. Show cause notice is an initial document which impose allegations or discrepancies on the taxpayer and provide an opportunity to the taxpayer to present their side of the story. Any action beyond the scope defined in SCN not only undermines the legitimacy of the authority but also compromises the rights of the individuals or entities involved.

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GST registration can’t be cancelled with retrospective effect mechanically| GST Officer must provide reason for such action
Judgements
CA. Sachin Jindal

GST registration can’t be cancelled with retrospective effect mechanically| GST Officer must provide reason for such action

These days, Taxpayers are genuinely facing issues in Input Tax credit due to back date cancellation of GST registrations of the suppliers. For FY 2017-18 and 2018-19, show cause notices were issued to various Assessee to disallow ITC on ground of cancellation of GST registration with retrospective effect. In most of such cases, GSTIN was cancelled due to non-filing of GST return for continuous period of six months. To resolve this issue, Hon’ble High Court of Delhi has passed a judgment to grant relief to taxpayers in the matter of ARYAN TIMBER STORE KUMAR SALES TAX OFFICER CLASS II/ AVATO WARD 62 DEPARTMENT OF TRADE AND TAXES IP ESTATE NEW DELHI (WP 628/2024 dated 18th January, 2024)

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Interest is not payable on late filing of GSTR-3B when the tax amount is deposited in Electronic Credit Ledger by the due date
Input Tax Credit
CA. Sachin Jindal

Interest is not payable on late filing of GSTR-3B when the tax amount is deposited in Electronic Credit Ledger by the due date

The Petitioner was having an accumulated Input Tax Credit under pre-GST regime. The petitioner filed GST TRAN-01 for transmission of such accumulated ITC under GST. However, due to technical glitches, entire amount of ITC was not transmitted under GST and complete amount was not available under electronic credit ledger of the petitioner.

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GST Portal may facilitate revision of GST returns
Returns
CA. Sachin Jindal

GST Portal may facilitate revision of GST returns

Concept of revision of Tax returns is a very usual and vital part of the tax system as it allows taxpayers to rectify unintentional errors made while filing tax returns. Every tax system including income tax provides a facility to revise tax returns upto specified time period. Under pre-GST regime as well, taxpayers were available with the option file revised VAT, Central Excise and Service Tax return. However, Goods and Service Tax has not yet provided that facility to revise GST returns to the taxpayers. 

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Deduction made by the applicant from employees for canteen services is not supply and ITC will be available for obligatory canteen services
Judgements
CA. Sachin Jindal

Deduction made by the applicant from employees for canteen services is not supply and ITC will be available for obligatory canteen services

The Kohler India Corporation Private Limited (“The Applicant ”) was mandatorily required to provide a canteen facility to the workers. The Applicant entered into a contract with Canteen service provider wherein invoice is raised by the CSP in the name of the applicant. Cost of CSP is borne by the applicant partially and the balance amount is recovered from the employees by way of deduction from salary. The amount is collected by the applicant from the employees without any commercial objective, i.e., without any profit markups. The question before Hon’ble AAR is Whether the subsidized deduction made by the applicant from the employees would be considered as ‘supply’ under CGST Act. Further, whether the applicant is entitled to claim ITC on invoice raised by the CSP.

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