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GST Updates as on 26/9/2022

7 December 2022

1. GST portal open from 1 Oct 2022 to 30 Nov 2022 for filing TRAN-1 and TRAN-2 forms: CBIC issues guidelines

[Circular no:180/12/2022-GST dated 9 September 2022]

The Apex Court, vide orders dated 22 July 2022 and 2 September 2022 (in the case of Union of India vs. FilcoTrade Centre Pvt. Ltd. and Anr.) had inter alia directed as follows:

  • The Goods and Services Tax Network (GSTN) to open the common portal for filing the Transitional Forms for a period of two months i.e. from 1 October 2022 to 30 November 2022

  • During such period, an aggrieved assessee could file or revise the Transitional Forms, irrespective of whether such assessee had filed a writ petition filed before the High Court or whether the case was decided by the Information Technology Grievance Redressal Committee

  • GSTN has to ensure that there are no technical glitches during the aforesaid period

  • Pursuant to the filing of the Transitional Forms, the concerned tax authorities are given a period of 90 days to verify the claim and pass appropriate orders on merits after granting a reasonable opportunity to the parties concerned

  • Pursuant to such verification, the transition credit will be reflected in the Electronic Credit Ledger (ECL)

In this regard, CBIC has issued the following guidelines for filing or revising the transitional Forms:

  • The applicant may file or revise duly signed or verified (through electronic verification code) Transitional Forms on the common portal. A facility for downloading the Transitional Forms already furnished will be made available in order to facilitate revision of the same

  • While filing or revising, the applicant shall also upload the PDF copy of a declaration in the format as given in Annexure ‘A’ of this circular. The applicant claiming credit in table 7A of Form GST TRAN-1 on the basis of the Credit Transfer Document (CTD) shall also upload the PDF copy of Form GST TRAN-3, containing the details in terms of the notification no:21/2017-CE(NT) dated 30 June 2017

  • No claim for transitional credit shall be filed in table 5(b) and 5(c) of Form GST TRAN-1 in respect of such C-Forms, F-forms and H/I-Forms which have been issued after the due date prescribed for submitting the declaration in Form GST TRAN-1 i.e. after 27 December 2017

  • Where the applicant files a claim in Form GST TRAN-2, he shall file the entire claim in one consolidated TRAN-2, instead of filing the claim tax-period-wise as referred to in rule 117(4)(b)(iii) of the CGST Rules 2017. In such cases, in the column ‘Tax Period’ of Form GST TRAN-2, the applicant shall mention the last month of the consolidated period for which the claim is being made

  • The applicant shall download a copy of the TRAN-1/TRAN-2 filed and submit a self-certified copy of the same, along with declaration in Annexure ‘A’ and a copy of TRANS-3 (if applicable) to the jurisdictional tax officer within 7 days of filing of declaration in TRAN-1/TRAN-2 on the common portal. The applicant shall keep all the requisite documents/records/returns/invoices, in support of his claim of transitional credit, ready for making the same available to the concerned tax officers for verification

  • This is a one-time opportunity for the applicant to either file or revise the forms. Hence it is required to take utmost care while filing or revising the Transitional Forms

  • The applicant is allowed to modify/edit, add or delete any record in any of the tables of the said forms before clicking the ‘Submit’ button. Once submitted, the form gets frozen, and no further editing of details is allowed. Such frozen form would then be required to be filed on the portal using the ‘File’ button, with a Digital signature certificate (DSC) or an EVC. Thus, the correctness of all the details in the Transitional Forms must be ensured before submitting the said forms. GSTN will issue a detailed advisory in this regard and the applicant may consider the same while filing

  • Once, the applicant files or revises the Transitional Forms, no further opportunity to again file or revise, will be allowed either during this period or subsequently

  • Registered persons who had successfully filed the Transitional Forms earlier, and who do not wish to make any revision are not required to file or revise the Transitional Forms

  • In cases where the credit availed by the registered person on the basis of the Transitional Forms filed earlier, has either wholly or partly been rejected by the proper officer, the appropriate remedy is to prefer an appeal against the said order or to pursue alternative remedies available as per law. Where the adjudication proceeding in such cases is pending, the appropriate course would be to pursue the said adjudication. In such cases, filing a fresh Transitional Form would not be an appropriate remedy

  • The declaration in the Transitional Forms, filed/revised by the applicant will be subjected to necessary verification by the concerned tax officers. The applicant may be required to produce the requisite documents/records/returns/invoices in support of their claim of transitional credit before the concerned tax officers for verification of their claim. After the verification of the claim, the jurisdictional tax officer will pass an appropriate order, after granting an appropriate reasonable opportunity of being heard by the applicant. The transitional credit allowed as per the order passed by the jurisdictional tax officer will be reflected in the ECL of the applicant.

Key Takeaways:

The Circular has laid down the process for claiming the transition credit which must be adhered to by the taxpayers. Unlike the erstwhile mechanism, the jurisdiction officer would first scrutinise the claim of transitional credits and subsequently, pass an order allowing the amount of eligible transition credit which would be reflected in the ECL of the taxpayer. Hence, taxpayers would need to substantiate their claim of transitional credits by way of corroborative evidence so as to facilitate the verification of such credits by the jurisdictional tax officer. Further, the powers under which the order allowing or rejecting the credit would be issued, provisions of appeal against such order, etc. would also need to be clarified.


2. E Invoice threshold lowered w.e.f. 01.10.2022 to persons with turnover exceeding Rs 10 crores:

The turnover threshold for compulsory e-invoicing in GST has been lowered. From 1.10.2022, every registered person whose aggregate annual turnover in any preceding financial year from 2017-18 onwards exceeds Rs. 10 Cr becomes liable for e-Invoicing. Such a person is liable to issue e-invoice by way of uploading its tax invoice in json file on Invoice Registration Portal (IRP) in accordance with e-invoice schema in INV-01 and getting back digitally signed json from IRP with IRN and QR Code.

  • E-Invoicing applies to supply of goods or services or both.

  • E-Invoicing applies to export (with or without payment) also.

  • Applies to B2B transactions only.

  • Applies to supplies to SEZ Unit

  • Applies to Deemed Export Documents covered under e-Invoicing.

Exemptions from e-invoicing:

Certain exemptions from e-invoicing have been given under Notification No. 13/2020 CT dt 21.03.2020:

  • Registered persons covered by sub-rule (2), (3), (4) & (4A) of Rule 54 are exempt from issuing e-invoice, such as – Insurance, Banking or Financial Institution including NBFC [Rule 54(2)].

  • Goods Transport Agency transporting goods by road [Rule 54(3)].

  • Supplier of passenger transportation service [Rule 54(3)].

  • Person supplying services by of admission to exhibition of cinematographic film in

  • multiplex screen.

  • SEZ Unit as per Notification No. 61/2020 CT dt 30/07/20 exempted.

Following documents are not covered under e-invoice applicability:

  • Bill of Supply, Self Invoice in case of RCM u/s 9(4),

  • Advance Payment, Delivery Challan,

  • Financial Debit/ Credit Note.

E invoice not applicable on following transaction:

  • B2C transactions, Non-GST Supplies (alcoholic liquor, Petrol, Diesel etc),

  • Bill of Entry in case of Import, Nil rated or exempted supplies.

Consequences on non-issuance of e-invoice:

  • When required Invoice issued in any manner other than in terms of rule 48(4) shall not be treated as valid invoice.

  • Disentitle the recipient from claiming ITC.

  • It may also attract penalty for not issuing valid tax invoice u/s 122.

Amendment & Cancellation of E-Invoice:

E-Invoice can be cancelled on the IRP within 24 hours of generation of the IRN. This is mainly

because the IRP servers do not store e-Invoices for more than 24 hours. However, if an e-Way Bill is already generated for the IRN, it cannot be cancelled.

Partial cancellation of e-Invoice is not possible; hence, the whole of the invoice would have to be cancelled. Moreover, any amendments of any sort cannot be done on the IRP as there is e-invoice cancellation time limit. In case any changes are necessary for the invoice details reported on the IRP, then, it can be through the GST portal while filing GSTR-1.

If an IRN is cancelled, then, the same invoice number cannot be used again to generate another IRN. If it is used again, the invoice will be rejected by the IRP, when reported. This is because, IRN is a unique reference number for individual invoices generated based on the supplier’s GSTIN, document/invoice number, type of document & financial year it is issued in.

If an e-way bill for an IRN is active, cancellation of IRN will not be permitted by the IRP. In case an IRN is cancelled, then GSTR-1 will also be automatically updated with such ‘cancelled’ status.

If an invoice has to be cancelled after 24 hours, the taxpayers can manually cancel the same on the GST portal before filing the GST returns.

Amendments to an e-Invoice are allowed only through the GST portal as per the provisions of GST law.

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