ICAI submits Suggestions on GST Return formats to Finance Minister

ICAI submits Suggestions on GST Return formats to Finance Minister :Indirect Taxes Committee ofICAI submits Suggestions on GST Return formats to Finance Minister Arun Jaitley. 30th August, 2018 ICAI/IDTC/2018-19/Letter/ 17 Shri Arun laitley Hon'ble Union Minister of Finance, and Chairman, Goods & Services Tax Council Ministry of Finance, Government of India, North Block New Delhi -110001 Respected Sir, Sub: Suggestions on GST draft proposed return formats At the outset, we are thankful to the Government for considering most of the suggestions on issues related to GST submitted by the ICAI from time to time. We refer to the draft return formats on GST released by the Government seeking comments/feedback on the same. In this regard, we are enclosing herewith ICAI's suggestions thereon. The suggestions have been finalized based on the inputs received from members across India who are involved in GST implementation. We hope that these suggestions would also be considered favorably. We shall be glad to provide any further input as may be required and your office may reach us at [email protected] or 0120-3045954. Thanking you and with warm regards, Yours sincerely, CA Naveen N.D. Gupta

EXECUTIVE SUMMARY

S. No.	Topic(s)	Suggestion (s)
Key features of Monthly Return
1.	Turnover figure to identify the type of taxpayer not be auto populated	1. It is suggested that the calculation for annualized turnover should not be automatic. Therefore, it is suggested that the auto populated figure should be editable so that taxpayer can correct erroneous figures if any uploaded in the FY 2017-18. 2. Also, It is suggested that due date for filing of return by a small taxpayer who have opted to pay tax on quarterly basis be provided as 30th of the month fol I owi ng the quarter.
2.	Term Turnover is not defined to identify small taxpayer	It is suggested that the term turnover be clearly defined in line with the definition of the term aggregate turnover as per section 2(6) of the CGST Act, 2017.
3.	Uploading date of invoices be considered instead of reflected date on the portal	It is suggested that the date of last upload (which may successfully reflect in few days) shall have to be captured for determining the date of upload of invoice. Additionally, it is suggested that the transition phase not be provided for instead of that any recoveries or disallowance on account of mis-match for the 1st year of implementation be initiated after the ti me limit provided under Section 39(9) of the CGST Act, 2017 (till the time of filing return for the of September following the end of the relevant financial year)
4.	Online reporting mechanism to report situations where wrong credit claimed /credit note not accepted by recipient	It is suggested that online reporting mechanism be there so that the supplier can report such situations to the GST system /Nodal officer about excess ITC claim taken by the recipient so that it can be recovered from him & credit may be given to the supplier in a time bound manners i.e. 2 months.
5.	Need to provide 4 digit HSN is contrary to Notification no. 12/2017 (CT)	Proposing to specify the condition of reporting HSN at 4 digit for goods and 6 digits for services, would be in contrary to the above notification. Therefore, it is suggested to give relief in declaring the HSN digits in line with the Notification No. 12/2017 Central Tax dated 28.06.2017 wherein the relief is granted to indicate HSN codes.
6.	Pending invoice an exclusive definition	It is suggested that other possible situations be inserted in the definition of pending invoice as Others so that on happening of such situation recipient can keep the invoice pending.
7.	Higher late fee not be imposed	It is suggested that higher late fee not be i mposed
8.	Supply side control on newly registered persons	It is suggested that the threshold limit not be there for newly registered tax payers, only tax defaulters be covered under this.
Key features of Quarterly Return
9.	Options of pending and missing invoices is not available in quarterly return	It is suggested that missing tax invoice concept be there in quarterly returns as well.
Annexure of Supplies to main Return
10.	Multiple reporting of same invoice tax rate wise in Annexure of Supplies to main Return	It is suggested that the column of Tax Rate be removed to facilitate smooth uploading of single invoices having multiple rates. Further, HSN wise tax rate details is already captured in Table 5 of Annexure of supplies of main return on page no. 14- HSN wise summary of inward supplies and that of outward supplies declared in table 3. Therefore, duplicate information is not required in Table 3 at invoice level. Concept of matching at Invoice level is preferred but not at line level.
11.	HSN wise summary in Annexure of Supplies to main Return	HSN Wise summary should remove UQC and Quantity or should be made optional.
GSTR Monthly Return
12.	Non-GST supply is nowhere defined	It is suggested that if details of Non-GST supply is required, then this word should be properly defined in the Act. Till such definition is provided in the Act, details of Non-GST supply not be asked for. However, if providing details of Non-GST supply is still persisted, then No supply under Schedule III, Section 7 under Sl. No. 3 of Table 3D should be merged with Non-GST supply under S. No. 2 of Table 3D.
13.	Supplies uploaded by supplier on which credit already allowed be auto populated	It is suggested that auto populated as well as user editable version may be enabled for ease of filing. In the absence of above mentioned facility, differentiating genuinely erring person from a fraudster will become difficult. So it may be considered 4A7 -3L of Annexure for Auto Population.
Sugam
14.	Non-reporting of inward supplies on which tax paid under RCM	It is suggested to insert a column with a description inward supplies on which tax is paid under RCM for claiming ITC on such inward supplies.
15.	Missing Tax Invoice for monthly period	It is suggested that it should be uploaded invoice wise and auto linked with 3(L) and B(4) on Auto mode. The process of the same has been explained below: When a supplier has not uploaded the Invoice, Recipient should have a facility to take Input Tax credit suo motto. The following is the suggested Credit availment mechanism: 1. Recipient is allowed to take a bulk credit i n Table 4A7 2. Credit availed in this bucket shall be made as a provisional credit in Electronic Credit Ledger. 3. Provisional Credit can have the following future actions a. Invoice subsequently uploaded by supplier b. Recipient can report other than `a above in 3L of Annexure 1. This reporting to be done within 4 months of Table 4 A7 2. Those reported by recipient in 3L should be available in supplier view 3. Same as 1A 4. Supplier to take Action of accept or Reject or keep pending a) Accepted by Supplier Audit Credit reversal in 4B4 b) Rejected by Supplier Auto Reversal in a new column to be added in 4B c) Kept pending to be auctioned with 4 months considering quarterly tax filers etc. c. No Action by supplier on missing Invoices for a period of 4 months should get auto reversed in Table 4B into a new column to be added
16.	Filing of Nil return by SMS	It is suggested that in case of output tax liability is NIL then facility to file nil return be provided to all taxpayer through SMS, even though they have any purchases as credit may be claimed till the September of the following financial year.
17.	Negative Liability Refund Facility, Refund of Erroneous excess Cash Payment of taxes	In case of Negative liability arising out of amendment return same shall be allowed for Refund in Table 8 of the Main Return for cash payment made
18.	Uploaded invoice as only condition for availing ITC	This single procedure cannot over-ride the 4 conditions al ready dictated in section 16(2). Therefore to align the return procedure with GST Law a suitable amendment in section 16(2) incorporating uploading of invoice as a condition for availing credit be made.
Other suggestions
19.	Other suggestions:	E-Sign of return (Aadhaar OTP based) to be provided. It is more simple and affordable than DSC based signing. Cash ledger on GST portal to be treated as wallet with freedom for cross utilization (across major and minor heads of tax/interest/penalty for IGST/CGST/MST)

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