The GST Council has met 48 times since its constitution, and many important decisions were taken in this 48th GST Council meeting. This 48th GST Council met under the Chairmanship of Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman via virtual mode in New Delhi on 17th December, 2022
One note that these are only recommendations of GST council meeting and the same would be given effect through the relevant circulars/ notifications/ law amendments which alone shall have the force of law
Changes in GST rates of certain goods in 48th GST Council meeting
| Sr No | Description of goods | Current GST Rate | Proposed GST Rate |
| 1 | Husk of pulses including chilka and concentrates including chuni/churi, khanda | 5% | NIL |
| 2 | Ethyl alcohol supplied to refineries for blendingwith motor spirit (petrol) | 18% | 5% |
RCM related changes in 48th GST Council meeting
Similar to what has been done for Mentha Oil, it was decided to integrate Mentha arvensis supply under the reverse charge process.
Clarifications in 48th GST council meeting
| Topic | Nature of Clarification |
|---|---|
| GST rate on rab-salwant | Rab (rab-salawat) is classifiable under CTH 1702 which attracts GST at the rate of 18% |
| GST rate on Fryms | Extruded fryums fall under CTH 19059030, which means they’re subject to GST at the standard rate of 18%. |
| Compensation on Motor Vehicle | The higher rate of compensation cess of 22% is applicable to motor vehicle fulfilling all four conditions namely,. it is popularly known as SUV. has engine capacity excedding 1500 cc. length exceeding 4000 mm and a ground clearance of 170 mm or above |
| Goods of lower rate of 5% | Goods falling in lower rate category of 5% under schedule I of notification No. 1/2017-CTR imported for petroleum operations will attract lower rate of 5% and the rate of 12% shall be applicable only if the general rate is more than 12% |
| GST on renting Residential Dwelling Unit | No GST is payable where the residential dwelling is rented to a registered person if it is rented it inhis/her personal capacity for use as his/her own residence and on his own account and not on account ofhis business |
| GST on Incentive paid to Banks | Incentive paid to banks by Central Government under the scheme for promotion of RuPay Debit Cards and low value BHIM-UPI transactions are in the nature of subsidy and thus not taxable |
| No Claim Bonus offered by the insurance companies | Circular to be issued to clarify that No Claim Bonus offered by the insurance companies to the insureds an admissible deduction for valuation of insurance services. |
| Statutory dues of taxpayer under Insolvency and Bankruptcy Code,2016. | Circular to be issued for clarifying the issue of treatment of statutory dues under GST law in respect of the taxpayers for whom the proceedings have been finalized under Insolvency and Bankruptcy Code,2016. Rule 161 of CGST Rules, 2017 and FORM GST DRC-25 also to be amended for facilitating the same. |
| Place of supply for service of transportation of goods | Circular to be issued for clarifying the issues pertaining to the place of supply of services oftransportation of goods in terms of the proviso to sub-section (8) of section 12 of the IGST Act, 2017and availability of input tax credit to the recipient of such supply. It has also been recommended thatproviso to sub-section (8) of section 12 of the IGST Act, 2017 may be omitted |
| Difference in Input Tax Credit | Procedure for verification of input tax credit in cases involving difference in input tax credit availed in FORM GSTR-3B vis a vis that available as per FORM GSTR-2A during FY 2017-18 and 2018-19 Comment This clarification is in order to remove ambiguity and legal disputes |
| Re-determination of demand | Clarifying the manner of re-determination of demand in terms of sub-section (2) of section 75 of CGST Act, 2017 Comment This clarification is in order to remove ambiguity and legal disputes |
| E-Invoice | Clarification in respect of applicability of e-invoicing with respect to an entity |
Relief measure in 48th GST Council Meeting
As a relief measure, the Council decided to regularize the intervening period starting from the date of issuance of Circular (3.08.2022) in respect of GST on ‘husk of pulses including chilka and concentrates including chuni/churi, khanda’ on “ as is basis” on account of genuine doubts.
Decriminalization under GST proposed in 48th GST Council meeting
- Raise the minimum threshold of tax amount for launching prosecution under GST from Rs. One Crore to Rs. Two Crores, except for the offence of issuance of invoices without supply of goods or services or both
- Reduce the compounding amount from the present range of 50% to 150% of tax amount to the range of 25% to 100%
- Decriminalize certain offences specified under clause (g), (j) and (k) of sub-section (1) of section 132 of CGST Act, 2017, viz.-obstruction or preventing any officer in discharge of his duties; deliberate tempering of material evidence; failure to supply the information
Refund to unregistered persons
There is no procedure for claim of refund of tax borne by the unregistered buyers in cases where the contract/ agreement for supply of services, like construction of flat/house and long-term insurance policy, is cancelled and the time period of issuance of credit note by the concerned supplier is over.
The Council recommended amendment in CGST Rules, 2017, along with issuance of a circular, to prescribe the procedure for filing application of refund by the unregistered buyers in such cases
Facilitate e-commerce for micro enterprises
GST Council in its 47th meeting had granted in-principle approval for allowing unregistered suppliers and composition taxpayers to make intra-state supply of goods through E-Commerce Operators (ECOs), subject to certain conditions.
The Council approved the amendments in the GST Act and GST Rules, along with issuance of relevant notifications, to enable the same. Further, considering the time required for development of the requisite functionality on the portal as well as for providing sufficient time for preparedness by the ECOs, Council has recommended that the scheme may be implemented w.e.f. 01.10.2023
GST on High Seal Sales and on supply of warehoused goods
Paras 7, 8(a) and 8(b) were inserted in Schedule III of CGST Act, 2017 with effect from 01.02.2019 to keep certain transactions/ activities, such as supplies of goods from a place outside the taxable territory to another place outside the taxable territory, high sea sales and supply of warehoused goods before their home clearance, outside the purview of GST.
In order to remove the doubts and ambiguities regarding taxability of such transactions/ activities during the period 01.07.2017 to 31.01.2019, the Council has recommended to make the said paras effective from 01.07.2017. However, no refund of tax paid shall be available in cases where any tax has already been paid in respect of such transactions/activities during the period 01.07.2017 to 31.01.2019.
Changes in GST related to ITC reversal on non payment to suppliers
Changes proposed in Rule 37(1) of CGST Rules 2017
The Council has recommended to amend sub-rule (1) of rule 37 of CGST Rules, 2017 retrospectively with effect from 01.10.2022 to provide for reversal of input tax credit, in terms of second proviso to section 16 of CGST Act, only proportionate to the amount not paid to the supplier vis a vis the value of the supply, including tax payable
New rule 37A proposed to be inserted in CGST Rules 2017
The Council recommended to insert Rule 37A in CGST Rules, 2017 to prescribe the mechanism for reversal of input tax credit by a registered person in the event of non-payment of tax by the supplier by specified date and mechanism for re-availment of such credit, if the supplier pays tax subsequently. This would ease the process for complying with the condition for availment of input tax credit under section 16(2)(c) of CGST Act, 2017.
Changes related to GST appeal in 48th Council Meeting
Clarification on submission of certified copy of the order appealed against
Sub-rule (3) of rule 108 and rule 109 of the CGST Rules, 2017 to be amended to provide clarity on the requirement of submission of certified copy of the order appealed against and the issuance of final acknowledgment by the appellate authority. This would facilitate timely processing of appeals and ease the compliance burden for the appellants.
Withdrawal of an application of appeal
Rule 109C and FORM GST APL-01/03 W to be inserted in the CGST Rules, 2017 to provide the facility for withdrawal of an application of appeal up to certain specified stage. This would help in reducing litigations at the level of appellate authorities
Changes related to cancellation of registration under GST
Sub-rule (3) of rule 12 of CGST Rules, 2017 to be amended to provide for facility to the registered persons, who are required to collect tax at source under section 52 or deduct tax at source undersection 51 of CGST Act, 2017, for cancellation of their registration on their request.
Streamlining compliances in GST
| Topic | Changes recommended |
| GST Registration | Proposal to conduct a pilot in State of Gujarat for Biometric-based Aadhaar authentication and risk-based physical verification of registration applicants. Amendment in rule 8 and rule 9 of CGST Rules,2017 to be made to facilitate the same. This will help in tackling the menace of fake and fraudulent registrations. |
| GST Registration | PAN-linked mobile number and e-mail address (fetched from CBDT database) to be captured andrecorded in FORM GST REG-01 and OTP-based verification to be conducted at the time ofregistration on such PAN-linked mobile number and email address to restrict misuse of PAN of aperson by unscrupulous elements without knowledge of the said PAN-holder |
| GST Returns/ Statements | Section 37, 39, 44 and 52 of CGST Act, 2017 to be amended to restrict filing of returns/ statements toa maximum period of three years from the due date of filing of the relevant return / statement. |
| GSTR-1 | FORM GSTR-1 to be amended to provide for reporting of details of supplies made through ECOs, covered under section 52 and section 9(5) of CGST Act, 2017, by the supplier and reporting by the ECO in respect of supplies made under section 9(5) of CGST Act, 2017 |
| Difference in GSTR-1 and GSTR-3B | Rule 88C and FORM GST DRC-01B to be inserted in CGST Rules, 2017 for intimation to the taxpayer, by the common portal, about the difference between liability reported by the taxpayer in FORM GSTR-1 and in FORM GSTR-3B for a tax period, where such difference exceeds a specified amount and/ or percentage, for enabling the taxpayer to either pay the differential liability or explain the difference |
| GSTR-1 | Clause (d) to be inserted in sub-rule (6) of rule 59 of CGST Rules, 2017 to restrict furnishing of FORM GSTR-1 for a subsequent tax period if the taxpayer has neither deposited the amount specified in the intimation nor has furnished a reply explaining the reasons for the amount remaining unpaid. This would facilitate taxpayers to pay/ explain the reason for the difference in such liabilities reported by them, without intervention of the tax officers. |
| Non-taxable online recipient” | Amendment in definition of “non-taxable online recipient” under section 2(16) of IGST Act, 2017 anddefinition of “Online Information and Database Access or Retrieval Services (OIDAR)” under section2(17) of IGST Act, 2017 so as to reduce interpretation issues and litigation on taxation of OIDAR Services |
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