CBIC clarifies on 'confusing' GST input tax credit rule | WeForNews | Latest News, Blogs CBIC clarifies on ‘confusing’ GST input tax credit rule – WeForNews | Latest News, Blogs
Connect with us

Business

CBIC clarifies on ‘confusing’ GST input tax credit rule

Published

on

GST Collection Down

New Delhi, Nov 11 : In a relief to taxpayers, the Central Board of Indirect Tax and Customs has clarified that a new rule announced last month, limiting input tax credit (ITC) claims to 20 per cent of the eligible amount where invoice matching has not been done and uploaded by the suppliers, would not be applicable in respect of the IGST paid on imports and GST paid under the reverse charge mechanism.

The new rule, announced by CBIC on October 9, limited the scope of input tax credit in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers to 20 per cent of the eligible amount. So, if ITC claim of say Rs 10 lakh was being claimed but documents supporting only Rs 6 lakh were uploaded, the total ITC applicable remained RS 6 lakh plus 20 per cent of Rs 6 lakh ie Rs 1.2 lakh (total Rs 7.2 lakh).

The October 9 notification caused a lot of confusion over the method of calculating this 20 per cent amount, the cut-off date and also whether it was to be calculated supplier-wise or on a consolidated basis.

It has now been clarified that the 20 per cent rule will not be applied supplier-wise but suppliers can use it on a consolidated basis. But while applying the new rule, the ITC should not be over and above the original claim presented by the suppliers to the tax department through online submissions in respective forms.

The CBIC has also clarified, that if under the 20 per cent rule, balance ITC claims of suppliers remain, thes can be claimed by the taxpayer in any of the succeeding months provided details of requisite invoices are uploaded by them. The taxpayer can claim proportionate ITC as and when details of some invoices are uploaded by the suppliers.

In order to prevent use of fake GST invoices for availing input tax, the government had last month made it compulsory to match the invoices uploaded by the suppliers in their GSTR1 forms before buyers can avail Input Tax Credit in their GSTR-3 returns.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

eighteen + five =

Business

DoT cracks whip, tells telcos to pay pending AGR dues fast

Published

on

By

Mobile tower

New Delhi, Dec 10 : The Department of Telecom (DoT) has asked telecom licencees to speed up the process of self-assessment of adjusted gross revenue (AGR) based dues and the payment of over Rs 1.47 lakh crore and submit comprehensive representation on previous issued demands latest by December 13, 2019.

The letter issued by the DoT has been viewed by IANS. The deadline for payment of AGR dues is January 23, 2020.

Three telcos — Airtel, Vodafone Idea and Tata Tele — have filed review petition of the Supreme Court order in October, which paved the way for the DoT to seek AGR dues, penalty and interest from the telcos.

“The comprehensive representation shall be submitted within a week latest by December 13, 2019,” DoT said in the letter to the telecom licensees, adding that majority of the licence fee assessments have been settled after the SC judgement and for any remaining issues, a comprehensive representation needs to be submitted to the department.

In light of the Supreme Court order on AGR computation, all the annual assessment for licence fees and spectrum usage charges for relevant years are being re-examined.

“And now since all the earlier demands are being re-examined with respect to the SC judgement, you are requested to kindly submit a comprehensive year-wise, circle-wise representation except for issues which have been decided by the SC,” the letter said.

“In this regard, it is pointed out that over a course of time, multiple representations related to LF (licence fee) assessments were received from various licencees for consideration by the department,” the DoT letter added.

Further, self-assessment of dues and payments along with the submission of relevant documents as per a licence finance wing letter of November 13 needs to be expedited, the letter said.

Any issues should be pointed out in the comprehensive representation to be submitted but in no case the self assessment of the dues and payments along with the submission of relevant documents are to be delayed, it pointed out.

The Supreme Court decided in favour of the government’s contention that all revenues, including that from non-core sources, would be counted in calculating AGR. Licence holders have to pay about 8 per cent of AGR to the DoT as fees. Telcos also pay about 3-4 per cent of AGR as spectrum usage charges.

Continue Reading

Business

RBI seen holding rates in the remainder of FY20

Published

on

By

Reserve Bank of India RBI

New Delhi, Dec 10 : Notwithstanding growth pangs, the Reserve Bank is expected to maintain the accommodative monetary easing pause till the end of FY20 to contain retail inflation levels, say industry observers.

Economists and industry experts pointed out that an imminent rise in retail food inflation over the next two months will override growth concerns and deter RBI to go in for a rate cut during the final monetary policy review for FY20 in Februray.

“In our view, the CPI inflation will rise sharply in the next two prints. So, we expect a pause in the February 2020 policy review,” said ICRA Principal Economist Aditi Nayar.

“Further monetary easing may not be sufficient to trigger a rapid revival in economic growth in the current situation.”

Recently, RBI’s monetary policy committee in its fifth review of the current fiscal maintained the repo, or short-term lending rate for commercial banks at 5.15 per cent.

The apex bank had reduced key lending rates during the last five policy reviews to reverse the current consumption slowdown that has plagued the country’s economy.

RBI Governor Shaktikanta Das defended the decision by recalling the “primary objective” of the central bank was inflation targeting and price control.

He pointed out that headline inflation is currently high, largely due to rise in food inflation. Das added that food inflation will remain “very high” during January-March, which prompted the RBI to hit the pause button on rate cuts.

Last month, macro-economic data showed that a substantial rise in food prices had lifted India’s October retail inflation to 4.62 per cent from 3.99 per cent in September.

The National Statistics Office is slated to release the macro-economic data point of Consumer Price Index for November on December 12, followed a day later by Wholesale Price Index.

Besides, RBI reduced the country’s FY20 GDP growth forecast from 6.1 per cent in the October policy to 5 per cent.

“Interestingly, the RBI seemed content with the pace of transmission and no longer sees the transmission as staggered and incomplete,” Edelweiss Securities’ Economist Madhavi Arora.

“We think that this easing pause is temporary. Even so, our estimates suggest inflation will likely remain above 5 per cent in 4QFY20 and could constrain a rate cut in February.”

Furthermore, RBI may await the budgetary announcements and the fiscal measures thereof before any decision to revise the rates.

According to Acuite Ratings & Research Lead Economist Karan Mehrishi: “At this point, an accommodative policy in pause mode appears likely till Q1 FY21.

“While there may be a potential risk of a rate hike if the inflation print remains persistently elevated along with a comfortable liquidity scenario, it is likely that the MPC will abstain from such action unless there is a modest revival in growth rate.”

(Rohit Vaid can be contacted at [email protected])

Continue Reading

Business

Slowdown Saga: Nov auto sales decline by 12 %

Published

on

By

Auto sector slowdown

New Delhi, Dec 10 : Domestic automobile sales continued to decline in November with the overall sectoral off-take plunging 12.05 per cent on a year-on-year basis, data showed on Tuesday.

According to the data furnished by the Society of Indian Automobile Manufacturers (SIAM), the sector’s total sales declined to 17,92,415 units in November from 20,38,007 units sold during the corresponding month of the previous year.

In October the overall sectoral off-take had declined by 12.76 per cent to 21,76,136 units.

Segment wise, the off-take of passenger vehicle sales during the month under review slipped by 0.84 per cent to 2,63,773 units this November on a year-on-year basis.

In terms of passenger cars’ sales de-grew by 10.83 per cent to 1,60,306 units from 1,79,783 units sold during November 2018.

But the utility vehicle sales grew by 32.70 per cent to 92,739 units, whereas vans’ off-take went down by 34.32 per cent to 10,728 units against that in the same month a year ago.

On the other hand, the key indicator of economic activity — commercial vehicle — segment’s sales were down by 14.98 per cent to 61,907 units.

The sale of three-wheelers in November rose by 4.45 per cent to 55,778 units.

In the case of two-wheelers, which include scooters, motorcycles and mopeds, the sale edged lower by 14.27 per cent to 14,10,939 units.

However, exports across categories were higher by 17.60 per cent at 4,11,470 units.

Continue Reading
Advertisement

Most Popular