GSTR 3B Mentioning details of inter-State supplies made to unregistered persons

GSTR 3B Mentioning details of inter-State supplies made to unregistered persons

As per Circular Number 89/08/2019-GST dated 18th February, 2019 CBIC has clarified that while filing GST Returns, A registered supplier is required to mention the details of inter -State supplies made to unregistered persons, composition taxable persons and UIN holders in Table 3.2 of FORM GSTR-3B.

Further, the details of all inter-State supplies made to unregistered persons where the invoice value is up to Rs 2.5 lakhs (rate-wise) are required to be reported in Table 7B of FORM GSTR-1.

Why it is important to mention details of inter-State supplies made to unregistered persons in GSTR 3B and GSTR 1

It is important to note that apportionment of IGST collected on interState supplies made to unregistered persons in the State where such supply takes place is based on the information reported in Table 3.2 of FORM GSTR-3B by the registered person. As such, non-mentioning of the said information results in

(i) non-apportionment of the due amount of IGST to the State where such supply takes place; and

(ii) a mis-match in the quantum of goods or services or both actually supplied in a State and the amount of integrated tax apportioned between the Centre and that State, and consequent non-compliance of sub-section (2) of section 17 of the Integrated Goods and Services Tax Act, 2017.

In Simple words, we all know that GST is destination based tax, which means that revenue of GST will be given to state where consumption of Goods/Service Takes Place.

Now when it comes to distribution of Revenue, it is easy for government to identify that which state deserves the revenue when it is case of CGST & SGST. [For supply to both registered and unregistered supplier]

Also in case case of IGST it is easy for government to identify that which state deserves the revenue in case of registered supplier.

But when it comes to distribution of IGST in case of supply to unregistered person, Table 3.2 of FORM GSTR-3B is the mechanism through which we inform government, name of the state where consumption has taken place. And that is the reason due to which it is important to mention details of inter-State supplies made to unregistered persons correctly in table 3.2 of GSTR 3B and Table 7B of FORM GSTR-1 .

Accordingly, CBIC has made it mandatory that the registered persons making inter-State supplies to unregistered persons shall report the details of such supplies along with the place of supply in Table 3.2 of FORM GSTR-3B and Table 7B of FORM GSTR1 as mandated by the law.

Contravention of any of the provisions of the Act or the rules made there under attracts penal action under the provisions of section 125 of the CGST Act.

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Circular No.	Date of issue	File No.	Subject
91/2019	18-02-2019	F. No. CBEC-20/16/04/2018 - GST	Seeks to give clarification regarding tax payment made for supply of warehoused goods while being deposited in a customs bonded warehouse for the period July, 2017 to March, 2018.
90/2019	18-02-2019	F. No. CBEC-20/16/04/2018 - GST	Seeks to clarify situations of compliance of rule 46(n) of the CGST Rules, 2017 while issuing invoices in case of inter- State supply.
89/2019	18-02-2019	F. No. CBEC-20/16/04/2018 - GST	Seeks to clarify situations of mentioning details of inter-State supplies made to unregistered persons in Table 3.2 of FORM GSTR-3B and Table 7B of FORM GSTR-1.