Statutory Updates For Nov-21 Exams

PAPER 8: INDIRECT TAX LAWS
STATUTORY UPDATE FOR NOVEMBER 2021

EXAMINATION
For the sake of brevity, Central Goods and Services Tax, Integrated Goods and Services
Tax, Central Goods and Services Tax Act, 2017, Integrated Goods and Services Tax Act,
2017, Central Goods and Services Tax Rules, 2017 and Integrated Goods and Services
Tax Rules, 2017 have been referred to as CGST, IGST, CGST Act, IGST Act, CGST Rules
and IGST Rules respectively.
The following are applicable for November 2021 examination:

(i) The provisions of the CGST Act, 2017 and IGST Act, 2017 as amended by the
Finance Act, 2020* and the Finance (No. 2) Act, 2019**, which have become
effective up to 30 th April, 2021, including significant notifications and
circulars issued and other legislative amendments made, up to 30 th April,
2021.
(ii) The provisions of the Customs Act, 1962 and the Customs Tariff Act, 1975,
as amended by the Finance Act, 2020, including significant notifications and
circulars issued and other legislative amendments made, up to 30 th April,
2021.
*All the amendments made by the Finance Act, 2020 in the CGST Act and the IGST
Act have become effective till 30.04.2021 and are thus applicable for November
2021 examinations.
** Most of the amendments made by the Finance (No. 2) Act, 2019 in the CGST
Act and the IGST Act have become effective, but select amendments made by the
Finance (No. 2) Act, 2019 namely, amendments made in sections 2(4), 95, 102,
103, 104, 105 and 106 of the CGST Act, 2017 and the insertion of new sections
101A, 101B & 101C in the CGST Act, 2017 have not become effective till
30.04.2021. Therefore, the same are not applicable for November 2021
examinations.
© The Institute of Chartered Accountants of India

The subject matter of Part I: Goods and Services Tax of November 2020 Edition of
the Study Material of Final (New Course) Paper 8: Indirect Tax Laws read
alongwith “Revisions in BoS Publications 1” is based on the provisions of the CGST
Act and the IGST Act as amended upto 31.10.2020.
The amendments made by the notifications and circulars issued between
01.11.2020 and 30.04.2021 in GST laws are given in this Statutory Update.
It may be noted that in the November 2020 Edition of the Study Material, the
erstwhile provisions of the CGST Act and the IGST Act have been compared with the
provisions as amended vide the Finance (No.2) Act, 2019 and Finance Act, 2020, at
the end of the relevant Chapters. Therefore, the same are not included in this
Statutory Update. Students should read the amended provisions given at the end of
the relevant Chapters in place of the erstwhile provisions discussed in the main
body of the Chapters.
However, the amendments of Finance (No.2) Act, 2019 which have not become
effective till 30.04.2021, as mentioned above, should not be referred to as the same
are not applicable for November 2021 examinations. For ease of reference, the
Chapters of the Study Material which cover the said amendments (which have not
become effective till 30.04.2021) are given below:
Chapter 19: Demands and Recovery
Chapter 22: Appeals and Revision
Chapter 23: Advance Ruling
The content discussed in Part II: Customs & FTP of the Study Material read alongwith
“Revisions in BoS Publications” is based on the customs law as amended by the
Finance Act, 2020 and significant notifications and circulars issued till 31.10.2020. The
significant notifications/ circulars issued from 01.11.2020 to 30.04.2021 in
Customs & FTP are given in this Statutory Update.
For the ease of reference, the amendments have been grouped into Chapters
which correspond with the Chapters of the Study Material.
It may be noted that November 2020 Edition of the Study Material for Final (New
Course) Paper 8 is applicable for Final (Old Course) Paper 8 also.
1
hosted on BoS Knowledge portal

PART -I: GOODS
AND SERVICES TAX

8
INPUT TAX CREDIT
1. ITC to be availed in respect of invoices/debit notes not uploaded by the

suppliers in their GSTR-1s, reduced from 10% to 5% of eligible ITC
[Rule 36(4)]
Section 16(2) of the CGST Act provides certain conditions for availing ITC
wherein one of the conditions is that the taxpayer must be in possession of
the tax invoice or other tax paying document in respect of which he is
claiming the ITC. Rule 36 of the CGST Rules lays down the documents and
other conditions basis which the registered person can claim ITC. Sub-rule
(4) of rule 36 specifies the quantum of ITC that can be claimed against the
invoices/debit notes uploaded and invoices/debit notes not uploaded, by
the supplier.
As per existing sub-rule (4) of rule 36, ITC to be availed by a registered
person in respect of invoices or debit notes, the details of which have not
been uploaded by the suppliers in GSTR-1, cannot exceed 10% of the
eligible credit available in respect of invoices or debit notes the details of
which have been uploaded by the suppliers in GSTR-1.
With effect from 01.01.2021, Notification No. 94/2020 CT dated
22.12.2020 has amended the said sub-rule to reduce the said percentage of
ITC from 10% to 5%. Amended rule 36(4) stipulates as follows:

ITC to be availed by a registered person in respect of invoices or debit
notes, the details of which have not been furnished by the suppliers under
section 37(1) in Form GSTR-1 or using the invoice furnishing facility (IFF),
cannot exceed 5% of the eligible credit available in respect of invoices or
debit notes the details of which have been furnished by the suppliers under
section 37(1) in Form GSTR-1 or using IFF.
2. Restrictions on use of amount available in electronic credit ledger [Rule
86B]
W.e.f. 01.01.2021, a new rule 86B has been inserted in the CGST Rules to
restrict the amount available in electronic credit ledger which a registered
person can use to discharge his output tax liability to 99% of such tax
liability in cases where the value of taxable supply other than exempt supply
and zero-rated supply, in a month exceeds ₹ 50 lakh. This rule overrides all
other rules.
It implies that a registered person shall not use the amount available in
electronic credit ledger to discharge his liability towards output tax in
excess of 99% of such tax liability, in cases where the value of taxable supply
other than exempt supply and zero-rated supply, in a month exceeds ` 50
lakh.
The total value of inter-State supply of Raman & Sons for the
month of February 2021 is of ` 100 lakh. Said supply is taxable
@ 18% IGST. Thus, total output tax liability of Raman & Sons is `
18 lakh. Amount available in electronic credit ledger is ` 20 lakh (IGST).
In terms of restriction imposed by rule 86B, Raman & Sons can discharge
99% of its output tax liability, i.e. `17,82,000 (99% of ` 18,00,000) from the
amount available in electronic credit ledger. However, it has to mandatorily
discharge the balance 1% of the output tax liability i.e. ₹ 18,000 (1% of `
18,00,000) through electronic cash ledger only.
Exceptions:
This restriction shall not apply in following cases:-
(a) Where the said person/proprietor/karta/managing director/any of its
two partners, whole-time directors, members of Managing Committee
of Associations or Board of Trustees, as the case may be, have paid

more than ` 1 lakh as income tax2 in each of the last 2 financial years3
(b) Where the registered person has received a refund of more than ` 1
lakh in the preceding FY on account of unutilised ITC in case of (i) zero
rated supplies made without payment of tax or (ii) inverted duty
structure.
(c) Where the registered person has discharged his liability towards
output tax through the electronic cash ledger for an amount which is
in excess of 1% of the total output tax liability, applied cumulatively,
upto the said month in the current financial year.
(d) Where the registered person is:-
▪ Government Department
▪ Public Sector Undertaking
▪ Local authority
▪ Statutory body
However, the Commissioner or an officer authorised by him in this
behalf may remove the said restriction after such verifications and
such safeguards as he may deem fit.
[Notification No. 94/2020 CT dated 22.12.2020]
2
under the Income-tax Act, 1961
3
for which the time limit to file return of income under section 139(1) of the Income-tax Act,
1961 has expired

9
REGISTRATION
1. Persons/class of persons exempt from aadhaar authentication
Section 25(6D) of the CGST Act stipulates that provisions relating to aadhaar
authentication shall not apply to such person or class of persons or any
State or Union territory or part thereof, as may be notified.
Earlier, in this regard, following persons were notified vide Notification No.
17/2020 CT dated 23.03.2020:
(i) A person who is not a citizen of India
(ii) A class of persons other than the following class of persons:
❑ Individual
❑ Authorised signatory of all types
❑ Managing and authorised partner
❑ Karta of a Hindu Undivided Family
The above notification has now been superseded and consequently,
following persons have been exempted from aadhaar authentication:-
✓ A person who is not a citizen of India

✓ Department or establishment of State Government or Central Government
✓ Local authority
✓ Statutory body
✓ Public Sector Undertaking
✓ A person applying for Unique Identity Number4.
2. Revised time limits prescribed under rule 9
Rule 9 of the CGST Rules which provides provisions relating to verification
of the application for registration and its approval has been amended w.e.f.
22.12.2020 in following manner:-
(i) Time-limit for approval of grant of registration
The time limit for approving the grant of registration to the applicant
by the proper officer if the application and accompanying documents
are found to be in order has been increased from 3 working days to
7 working days from the date of submission of application for
registration [Rule 9(1)].
Further, the time limit for grant of registration after physical
verification of the place of business of a person who fails to undergo
the aadhaar authentication/does not opt for aadhaar authentication
has been reduced to 30 days from 60 days. Provisos to rule 9(1)
have thus been substituted to provide that where:
(a) a person5 fails to undergo authentication of Aadhaar number as
specified in rule 8(4A) or does not opt for authentication of Aadhaar
number; or
(b) the proper officer, with the approval of an officer authorised by the
Commissioner not below the rank of Assistant Commissioner, deems
it fit to carry out physical verification of places of business,
4
under section 25(9) of the CGST Act
5
other than a person notified under section 25(6D)

the registration shall be granted within 30 days of submission of
application, after physical verification of the place of business in the
presence of the said person, in the manner provided under rule 25 and
verification of such documents as the proper officer may deem fit.
(ii) Time-limit for issuance of notice where application is found to be
deficient
The time limit for issuance of notice in prescribed form in case where the
application is found to be deficient, either in terms of any
information/document required to be furnished, or where the proper
officer requires any clarification, has been increased to 7 working days
from 3 working days from the date of submission of application for
registration [Rule 9(2)].
Further, the time limit for issuance of said notice to a person who fails
to undergo Aadhaar authentication/does not opt for Aadhaar
authentication has been increased to 30 days from 21 days from the
application submission date. Proviso to rule 9(2) has been substituted
to provide that where:
(a) a person6 fails to undergo authentication of Aadhaar number as
specified in rule 8(4A) or does not opt for authentication of Aadhaar
number; or
(b) the proper officer, with the approval of an officer authorised by the
Commissioner not below the rank of Assistant Commissioner, deems
it fit to carry out physical verification of places of business,
the notice in prescribed form may be issued not later than 30 days
from the date of submission of the application.
(iii) Deemed approval of application
Time limits for deemed approval of application under rule 9(5) have
been revised as follows:
6
other than a person notified under section 25(6D)

In case where the application for grant of
registration shall be deemed to
have been approved if the
proper officer fails to take any
action within a period of
registration is to be granted after 30 days from the date of

physical verification of the premises submission of the application
of a person (i) who fails to undergo
the aadhaar authentication/does
not opt for aadhaar authentication
or (ii) wherein proper officer deems
it fit to carry out physical
verification of places of business
the person other than those 7 working days from the date of
covered above submission of the application
proper officer issues notice seeking 7 working days from the date of
clarification, information or the receipt of the clarification,
documents from the applicant information or documents
furnished by the applicant

3. Violation of conditions of taking ITC, mismatch of GSTR-1 and GSTR-
3B, or violation of rule 86B, to make the GST registration of a person
liable to cancellation
As per section 29(2)(a) of the CGST Act, the proper officer may cancel the
registration of a registered person where he has contravened such
provisions of the CGST Act or the rules made thereunder as may be
prescribed. These contraventions have been prescribed by rule 21 of the
CGST Rules.
Said rule has been amended to provide few more contraventions, namely,
violation of conditions of taking ITC, mismatch of GSTR-1 and GSTR-3B and
violation of rule 86B provisions which will make the GST registration of a
10

person liable to cancellation. These contraventions have been depicted in
the diagram below:
avails ITC in violation of the

provisions of section 16 of the
CGST Act or the rules made
thereunder
Registered person
violates the provision of furnishes the details of outward supplies in Form GSTR-1
for one or more tax periods which is in excess of the
rule 86B [discussed
outward supplies declared by him in his valid return
earlier] under section 39 for the said tax periods

4. Provisions relating to suspension of GST registration amended [Rule
21A]
Rule 21A of the CGST Rules which provides for suspension of GST
registration has been amended as follows:-
(i) Where the proper officer has reasons to believe that the registration
of a person is liable to be cancelled, he can now suspend the
registration of such person, pending the cancellation proceedings,
without affording the said person a reasonable opportunity of
being heard [Sub-rule (2) amended].
(ii) Where, a comparison of the returns furnished by a registered person
under section 39 with:
(a) the details of outward supplies furnished in Form GSTR-1; or
(b) the details of inward supplies derived based on the details of outward
supplies furnished by his suppliers in their Form GSTR-1,
11

or such other analysis, as may be carried out on the recommendations
of the Council, show that there are significant differences or anomalies
indicating contravention of the provisions of the CGST Act or the rules
made thereunder, leading to cancellation of registration of the said
person, his registration shall be suspended.
Said person shall be intimated in prescribed form by sending a
communication to his e-mail address provided at the time of
registration or as amended from time to time.
In this intimation for suspension and notice for cancellation of
registration, the said differences and anomalies are highlighted and
said person is asked to explain, within a period of 30 days, as to why
his registration shall not be cancelled [New sub-rule (2A)].
(iii) In a case where the cancellation is initiated by the Department on its
own and registration of a person has been suspended, such person
shall not be granted any refund under section 54 of the CGST Act,
during the period of suspension of his registration [New sub-rule
(3A)].
(iv) Sub-rule (4) provides that the suspension of registration shall be
deemed to be revoked upon completion of the cancellation
proceedings by the proper officer with effect from the date on which
the suspension had come into effect. A proviso has been inserted to
rule 21A(4) which provides as follows:
The suspension of registration may be revoked by the proper officer,
anytime during the pendency of the proceedings for cancellation, if he
deems fit.
(v) Consequential amendments by virtue of insertion of sub-rule (2A) to
rule 21A have been made in sub-rule (3) & sub-rule (4) of rule 21A
and in sub-rule (3) & sub-rule (4) of rule 22.
12

10
TAX INVOICE, CREDIT

AND DEBIT NOTES
1. E-invoicing mandatory for all registered businesses with aggregate
turnover in any preceding financial year from 2017-18 onwards greater
than ` 50 crore
With effect from 1 st October, 2020, all registered businesses with an
aggregate turnover (based on PAN) in any preceding financial year from
2017-18 onwards greater than ` 500 crore were required to mandatorily
issue e-invoices for all B2B invoices.
With effect from 01.01.2021, e-invoicing has been made mandatory for all
registered businesses with an aggregate turnover in any preceding financial
year from 2017-18 onwards greater than ` 100 crore. Further, the threshold
limit for mandatory issuing e-invoicing ` 50 crore with effect from
01.04.2021.
13

The above situation has been summarized as follows:
2. Clarification in respect of applicability of Dynamic Quick Response

(QR)code
All B2C invoices issued by a registered person whose aggregate turnover
in any preceding financial year from 2017-18 onwards exceeds ` 500 crores
are mandatorily required to have a Dynamic QR code from December 1,
2020 vide Notification No. 14/2020 CT dated 21.03.2020.
Sixth proviso to rule 46 of the CGST Rules empowered the Government to
specify that the tax invoice shall have Quick Response (QR) code.
Resultantly, it has been notified 7 that invoice issued by a registered person
[except specified class of persons (discussed below)], whose aggregate
turnover in a financial year exceeds ` 500 crores, in respect of B2C supplies
(supply of goods or services or both to an unregistered person) shall have
Dynamic QR code.
In this regard, following issues have been further clarified vide Circular no.
146/02/2021 GST dated 23.02.2021:
I. Non-applicability of requirement of Dynamic QR code: Dynamic
QR code is not applicable to an invoice issued to an unregistered
person by following suppliers:
(i) Insurer or banking company or financial institution including NBFC
(ii) Goods transport agency supplying services in relation to
transportation of goods by road in a goods carriage
7
vide Notification No. 14/2020 CT dated 21.03.2020
14

(iii) Supplier of passenger transportation service
(iv) Person supplying services by way of admission to exhibition of
cinematograph films in multiplex screens
(v) Supplier of online information and database access or retrieval
(OIDAR) services8.
II. No Dynamic QR code in case of exports: As regards the supplies
made for exports, though such supplies are made by a registered
person to an unregistered person, however, since e-invoices are
required to be issued in respect of supplies for exports treating them
as B2B supplies, Dynamic QR code requirement will not be applicable
to them.
III. Parameters/ details are required to be captured in the Dynamic
QR Code: Dynamic QR Code, inter-alia, shall contain the following
information: -
❑ Supplier GSTIN number

❑ Supplier UPI ID
❑ Payee’s Bank A/c number and IFSC
❑ Invoice number & invoice date,
❑ Total Invoice value and
❑ GST amount along with breakup i.e. CGST, SGST, IGST, CESS, etc.
Further, Dynamic QR Code should be such that it can be scanned to

make a digital payment.
IV. Compliance with the Dynamic QR Code requirements in certain
cases: If the supplier has issued invoice having Dynamic QR Code for
payment, the said invoice shall be deemed to have complied with
Dynamic QR Code requirements.
8 Provisions relating to OIDAR services have been discussed at the Final level.
15

Case-I: If a supplier provides/ displays Dynamic QR Code, but the
customer opts to make payment without using Dynamic QR Code,
and supplier provides the cross reference of such payment made
without use of Dynamic QR Code, on the invoice
In cases where the supplier, has digitally displayed the Dynamic QR
Code and the customer pays for the invoice: -
i. using any mode like UPI, credit/ debit card or online banking or
cash or combination of various modes of payment, with or using
Dynamic QR Code, and the supplier provides a cross reference
of the payment (transaction id along with date, time and
amount of payment, mode of payment like UPI, Credit card,
Debit card, online banking etc.) on the invoice; or
ii. in cash, without using Dynamic QR Code and the supplier
provides a cross reference of the amount paid in cash, along
with date of such payment on the invoice;
said invoice shall be deemed to have complied with the
requirement of having Dynamic QR Code.
Case-II: If a supplier makes available to customers an electronic
mode of payment, where though Dynamic QR Code is not
displayed, but the details of merchant as well as transaction are
displayed/ captured otherwise
In such cases, if the cross reference of the payment made using such
electronic modes of payment is made on the invoice, the invoice shall
be deemed to comply with the requirement of Dynamic QR Code.
However, if payment is made after generation/ issuance of invoice, the
supplier shall provide Dynamic QR Code on the invoice.
Case-III: In case of pre-paid invoices i.e. where payment has been

made before issuance of the invoice
If cross reference of the payment received either through electronic
mode or through cash or combination thereof is made on the invoice,
16

then the invoice would be deemed to have complied with the
requirement of Dynamic QR Code.
In cases other than pre-paid supply i.e. where payment is made after
generation / issuance of invoice, the supplier shall provide Dynamic
QR Code on the invoice.
V. Once the e-commerce operator (ECO) or the online application
has complied with the Dynamic QR Code requirements, whether
the suppliers using such e-commerce portal or application will
still be required to comply with the requirement of Dynamic QR
Code?
Dynamic QR code requirements apply to each supplier/registered person
separately, if such person is liable to issue invoices with Dynamic QR
Code for B2C supplies.
In case, the supplier is making supply through the e- commerce portal or
application, and the said supplier gives cross references of the payment
received in respect of the said supply on the invoice, then such invoices
would be deemed to have complied with the requirements of Dynamic
QR Code.
In cases other than pre-paid supply i.e. where payment is made after
generation / issuance of invoice, the supplier shall provide Dynamic QR
Code on the invoice.
17

11
ACCOUNTS AND
RECORDS; E-WAY BILL
1. Validity period of e-way bill or a consolidated e-way bill reduced [Rule

138(10)]
Rule 138(10) elaborates the validity period of e-way bill/consolidated e-way
bill. With effect from 01.01.2021, validity period of e-way bill/consolidated
e-way bill has been reduced as follows:-
Sl. No. Distance within the country Validity period from relevant
date
Prior to After the
amendment amendment
1. Upto 100 Upto 200 km One day in cases other than

km Over Dimensional Cargo or
multimodal shipment in which
at least one leg involves
transport by ship
2. For every For every 200 One additional day in cases

100 km or km or part other than Over Dimensional
part thereof thereof Cargo or multimodal shipment
thereafter thereafter in which at least one leg
involves transport by ship
18

A registered person has to transport goods from its warehouse to its
depot located at a distance of 500 km. In the given case, if e-way bill
was generated before 01.01.2021, it would have been valid for 5
days. However, an e-way bill generated on or after 01.01.2021 would be valid
for only 3 days.
2. Blocking of e-way bill generation facility, extended to a person, whose
registration has been suspended [Rule 138E]
Blocking of e-waybill generation facility means disabling a taxpayer from
generating the e-way bill. A user will not be able to generate e-way bill for
a GSTIN if the said GSTIN is not eligible for e-way bill generation as per rule
138E of the CGST Rules. The GSTINs of such blocked taxpayers cannot be
used to generate the e-way bills either as consignor or consignee.
Clause (b) of rule 138E blocks the e-way bill generation facility of a person
paying tax under regular scheme if he has not furnished the returns for a
consecutive period of 2 months.
Said clause has been amended to replace 2 months with 2 tax periods.
Accordingly, henceforth, e-way bill generation facility of a person paying tax
under regular scheme will be blocked if he has not furnished the returns for
a consecutive period of 2 tax periods.
Further, a new clause (d) has been added to rule 138E to block the e-way
bill generation facility of a person, whose registration has been suspended
under rule 21A pending the completion of the proceedings for cancellation
of registration.
19

13
RETURNS
1. Quarterly Return Monthly Payment (QRMP) Scheme
Proviso to section 39(1) of the CGST Act, 2017, inserted with effect from
10.11.2020, empowers the Government to notify certain class of
registered persons who shall furnish return on quarterly basis. Further,
section 39(7), amended with effect from 10.11.2020, provides that person
so notified to furnish quarterly return shall pay taxes due during a month
within prescribed time and manner.
In terms of above provisions, with effect from 01.01.2021, a Quarterly
Return Monthly Payment
(QRMP) Scheme has been
introduced as a trade
facilitation measure and in
order to further ease the process of doing business.
20

Quarterly Return Monthly
Payment (QRMP) Scheme
QRMP Scheme is an
optional return filing
scheme, introduced for
small taxpayers having
aggregate annual turnover
(PAN based) of upto ₹ 5
crore in the current and
preceding financial year to
furnish their Form GSTR-1
and Form GSTR-3B on a
quarterly basis while
paying their tax on a
monthly basis through a
simple challan.
This will significantly reduce the compliance burden on such taxpayers as
now the taxpayers need to file only 4 GSTR-3B returns instead of 12 GSTR-
3B returns in a year. Similarly, they would be required to file only 4 GSTR-1
returns since Invoice Filing Facility (IFF) is provided under this scheme.
Opting of QRMP scheme is GSTIN
wise. Distinct persons can avail QRMP
scheme option for one or more
GSTINs. It implies that some GSTINs
for a PAN can opt for the QRMP scheme and remaining GSTINs may not opt
for the said scheme.
I. Eligibility for QRMP scheme
Registered persons9, having an aggregate turnover up to ` 5 crore
in the preceding financial year, and who have opted to furnish
quarterly return under QRMP scheme 10 as the class of persons who
9
other than supplier of online information and database access or retrieval services (OIDAR)
located in non-taxable territory and providing such services to a non-taxable online recipient
10
opted under rule 61A of the CGST Rules, 2017 (discussed subsequently)
21

shall furnish a return for every quarter from January, 2021 onwards,
and pay the tax due every month 11.
Thus, the taxpayers whose aggregate turnover is up to ` 5 crore in the
preceding financial year are eligible for QRMP scheme. For computing
aggregate turnover, details furnished in returns for tax periods in the
preceding financial year shall be taken into account.
Conditions and restrictions:
(i) Registered persons under QRMP scheme must have furnished the
return for the preceding month, as due on the date of exercising such
option. A registered person shall not be eligible to opt for QRMP
scheme if he has not furnished the last return due on the date of
exercising such option.
If a registered person intending to avail of QRMP
scheme for the quarter ‘July to September’ is
exercising his option on 27 th July for the said quarter,
he must have furnished the return for the month of June which
was due on 22 nd/24th July.
(ii) Registered persons under QRMP scheme are not required to exercise
the option every quarter. Where such option has been exercised
once, they shall continue to furnish the return as per the selected
option for future tax periods, unless they revise the said option.
Manner of exercising option of QRMP scheme [Rule 61A]
A registered person intending to opt for QRMP scheme for any
quarter shall indicate his preference for furnishing of return on a
quarterly basis from 1 st day of the 2 nd month of the preceding quarter
till the last day of the 1st month of the quarter for which the option is
being exercised.
A registered person intending to avail of QRMP scheme for
the quarter ‘July to September’ can exercise his option from
1 May to 31st July.
st
11
in accordance with the proviso to section 39(7)
22

However, where such option has been exercised once, the said
registered person shall continue to furnish the return on a quarterly
basis for future tax periods, unless he–
(a) becomes ineligible for this scheme as per the conditions and
restrictions notified in this regard; or
(b) opts for furnishing of return on a monthly basis, electronically, on the
common portal.
Option of QRMP scheme to lapse
In case where a registered person’s aggregate turnover crosses ` 5
crore during a quarter in a financial year, he shall not be eligible for
furnishing of return on quarterly basis from the first month of the
succeeding quarter. He shall opt for furnishing of return on a monthly
basis, electronically, on the common portal, from the first month of
the quarter, succeeding the quarter during which his aggregate
turnover exceeds ` 5 crore.
The facility for opting out of the scheme for a quarter will be available
from 1st day of 2nd month of preceding quarter to the last day of the
1st month of the quarter.
II. Form and manner of furnishing details of outward supplies -
GSTR-1 [Rule 59 substituted with a new rule]
❑ The details of outward supplies are required to be furnished,
electronically, in Form GSTR-1, for the month or quarter.
Invoice furnishing facility (IFF)
❑ Taxpayers opting for QRMP scheme may furnish the details of
such outward supplies to a registered person, as he may
consider necessary, for the 1st and 2 nd months of a quarter, using
invoice furnishing facility (hereafter referred to as the “IFF”).
Invoices pertaining to last month of a quarter are to be uploaded in
GSTR-1 only.
23

❑ The facility of furnishing details of invoices in IFF has been provided
so as to allow details of such supplies to be duly reflected in the
Form GSTR-2A
and Form
GSTR-2B of the
concerned
recipient. In
case where a
buyer has
made
purchases
from a person
opting for
QRMP scheme,
he could not have claimed full ITC but due to introduction of IFF,
such delay will not occur as the details submitted using IFF will be
reflected in the GSTR-2A, GSTR-2B, GSTR-4A or GSTR-6A of the
recipients, as the case may be.
❑ The IFF is not mandatory, but an optional facility made
available to the registered persons under the QRMP scheme.
At his option, a registered person may choose to furnish the details of
outward supplies made during a quarter in Form GSTR-1 only, without
using the IFF.
❑ Taxpayers using IFF can upload the invoice details upto a
cumulative value of ` 50 lakh in each of the first 2 months of the
quarter.
❑ The invoices are to be furnished in IFF between the 1st day of the
succeeding month till the 13th day of the succeeding month. After
13th of the month, this facility for furnishing IFF for previous month
would not be available12.
12
As a facilitation measure, continuous upload of invoices would also be provided for the
registered persons wherein they can save the invoices in IFF from the 1 st day of the month till
13th day of the succeeding month.
24

The said facility would however be available, say for the month of July,
from 1st August till 13th August. Similarly, for the month of August, the
said facility will be available from 1st September till 13th September.
❑ The details of invoices furnished using IFF in the first 2 months of
the quarter are not required to be furnished again in GSTR-1 for
the said quarter.
A registered person who has availed the QRMP scheme
wants to declare 2 invoices out of the total 10 invoices
issued in the 1st month of quarter since the recipient of
supplies covered by those 2 invoices desires to avail ITC in that
month itself. Details of these 2 invoices may be furnished using IFF.
The details of the remaining 8 invoices shall be furnished in Form
GSTR-1 of the said quarter. The two invoices furnished in IFF shall
be reflected in Form GSTR-2B of the concerned recipient of the 1st
month of the quarter and remaining 8 invoices furnished in Form
GSTR-1 shall be reflected in Form GSTR-2B of the concerned
recipient of the last month of the quarter.
❑ In the IFF, the taxpayer has to submit the B2B (business to
business) invoice details of both inter-State and intra-State
supply transactions along with debit and credit notes of the B2B
invoices issued during the month. The details of outward supplies
furnished using IFF shall include the –
(a) invoice wise details of inter-State and intra-State supplies made
to the registered persons;
(b) debit and credit notes, if any, issued during the month for such
invoices issued previously.
❑ However, if a registered person does not opt to upload invoices
using IFF, then he has to upload invoice details for all the 3 months
of the quarter in Form GSTR-1.
❑ The details of outward supplies of goods and/or services furnished
in Form GSTR-1 shall include the–
(a) invoice wise details of all -
25

(i) inter-State and intra-State supplies made to the
registered persons; and
(ii) inter-State supplies with invoice value more than `
2,50,000 made to the unregistered persons.
(b) consolidated details of all -
(i) intra-State supplies made to unregistered persons for
each rate of tax; and
(ii) State wise inter-State supplies with invoice value upto `
2,50,000 made to unregistered persons for each rate of
tax;
(c) debit and credit notes, if any, issued during the month for
invoices issued previously.
❑ Cases where a registered person shall not be allowed to furnish
details of outward supplies in GSTR-1/IFF
➢ A registered person shall not be allowed to furnish the
details of outward supplies in Form GSTR-1, if he has not
furnished the return in Form GSTR-3B for preceding two
months.
➢ A registered person, opting for QRMP scheme shall not be
allowed to furnish the details of outward supplies under in
Form GSTR-1 or using IFF, if he has not furnished the
return in Form GSTR-3B for preceding tax period.
➢ A registered person, who is restricted from using the
amount available in electronic credit ledger to discharge
his liability towards tax in excess of 99% of such tax liability
under rule 86B of the CGST Rules, shall not be allowed to
furnish the details of outward supplies in Form GSTR-1 or
using IFF, if he has not furnished the return in Form
GSTR-3B for preceding tax period.
26

III. Form and manner of ascertaining details of inward supplies –
GSTR-2A and GSTR-2B [Rule 60 substituted with a new rule]
❑ Form GSTR-2A13 - is a system generated read
only statement of inward supplies for a
recipient. This statement is updated on a real
time basis. The details become available to
the recipient for view/download and are updated incrementally as
and when supplier(s) upload or change details in their respective
form of return/statement, for the given tax period.
❑ Details of outward supplies furnished by the supplier in Form
GSTR-1 or using the IFF is made available electronically to the
concerned registered persons (recipients) in Form GSTR-2A, in
Form GSTR-4A and in Form GSTR-6A, as the case may be.
Details of invoices furnished by a non-resident taxable person in
Form GSTR-5 and by an Input Service Distributor in Form GSTR-6,
details of TDS by deductor furnished in Form GSTR-7 and details of
TCS by an e-commerce operator furnished in Form GSTR-8, are
made available to the recipient, deductee or concerned person, in
Form GSTR-2A.
Further, details of the integrated tax paid on the import of goods
or goods brought in DTA from SEZ unit/developer on a bill of entry
are also made available in Form GSTR-2A.
❑ Form GSTR-2B – an auto-drafted read only
statement containing the details of ITC - is
made available to the registered person
(recipient) for every month. It is a static
statement and is available only once a month.
It consists of –
(i) the details of outward supplies furnished by the suppliers in
13
Auto-drafted details for registered person opting for composition levy are contained in Form
GSTR-4A and auto-populated details of ITC received for distribution by Input Service Distributor
are contained in Form GSTR-6A.
27

Form GSTR-1, other than a supplier who has opted for QRMP
scheme, between the day immediately after the due date of
furnishing of Form GSTR-1 for the previous month to the due
date of furnishing of Form GSTR-1 for the month.
(ii) the details of outward supplies furnished by his supplier who
has opted for QRMP scheme, in Form GSTR-1 or using the IFF,
as the case may be14,-
(a) for the 1st month of the quarter, between the day
immediately after the due date of furnishing of Form
GSTR-1 for the preceding quarter to the due date of
furnishing details using the IFF for the 1st month of the
quarter;
(b) for the 2nd month of the quarter, between the day
immediately after the due date of furnishing details using
the IFF for the 1st month of the quarter to the due date of
furnishing details using the IFF for the 2nd month of the
quarter;
(c) for the 3rd month of the quarter, between the day
immediately after the due date of furnishing of details
using the IFF for the 2nd month of the quarter to the due
date of furnishing of Form GSTR-1 for the quarter.
(iii) the details of the integrated tax paid on the import of goods or
goods brought in the DTA from SEZ unit/developer on a bill of
entry in the month.
Form GSTR-2B consists of all documents filed by suppliers/ISD in their
Form GSTR-1, 5 & 6, between the cut-off dates. It also consists of
import data for the period which are received within 13th of the
succeeding month.
In case of monthly Form GSTR-1, the cut-off date is 00:00 hours on
12th of the relevant month to 23:59 hours, on 11th of the succeeding
14
details of invoices are furnished by a non-resident taxable person in Form GSTR-5 and by an
Input Service Distributor in his return in Form GSTR-6
28

month. Whereas for quarterly Form GSTR-1/IFF, Form GSTR-5 and
Form GSTR-6, the cut-off date is 00:00 hours on 14th day of relevant
month to 23:59 hours, on 13th day of succeeding month.
The details filed in Form GSTR-1 & 5 (by supplier) & Form GSTR-6 (by
IS`D) would reflect in the next open Form GSTR-2B of the recipient
irrespective of supplier’s/ISD’s date of filing.
If a supplier opting for QRMP files an invoice dated 15th
July on 13th August, it will get reflected in GSTR-2B of
July (generated on 14th August). If the document is filed
on 14th August, the document will be reflected in Form GSTR-2B of
August (generated on 14th September).
❑ The statement in Form GSTR-2B for every month shall be made
available to the registered person,-
(i) for the 1st and 2nd month of a quarter, a day after the due date
of furnishing of details of outward supplies for the said month,
• in the IFF by a registered person opting for QRMP, or
• in Form GSTR-1 by a registered person other than
opting for QRMP,
whichever is later.
(ii) in the 3rd month of the quarter, a day after the due date of
furnishing of details of outward supplies for the said month, in
Form GSTR-1 by a registered person opting for QRMP.
For the quarter July-September, Form GSTR-2B for a
registered person (recipient) who has received supplies
from QRMP suppliers as well as from other suppliers will
be generated as follows:
Month Date of generation of GSTR-2B
July 14th August
August 14th September
September 14th October
29

IV. Form and manner of filing return – GSTR-3B [Rule 61 substituted
with a new rule]
❑ Every registered person, other than an input service distributor or a
non-resident taxable person or a composition taxpayer, a person
deducting tax at source, a person collecting tax at source, i.e. an
electronic commerce operator and supplier of OIDAR services
located in non-taxable territory providing such services to non-
taxable online recipient, is required to furnish a return in Form
GSTR-3B, electronically.
Due date for filing return
(i) In case of a taxpayer opting for QRMP scheme - Quarterly GSTR-
3B on or before 22nd or 24th of the month succeeding the quarter
for which return is furnished (Refer the Table given below for
details**).
(ii) In case of other taxpayers - Monthly GSTR-3B on or before 20th of
the month succeeding the month for which return is furnished.
**Due dates for taxpayers opting for QRMP scheme
Class of registered persons Due date

Registered persons whose principal place of 22nd day of
business is in the States of Chhattisgarh, Madhya the month
Pradesh, Gujarat, Maharashtra, Karnataka, Goa, succeeding
Kerala, Tamil Nadu, Telangana, Andhra Pradesh, such
Union territories of Daman & Diu & Dadra & Nagar quarter.
Haveli, Puducherry, Andaman and Nicobar Islands or
Lakshadweep.
Registered persons whose principal place of 24th day of

business is in the States of Himachal Pradesh, the month
Punjab, Uttarakhand, Haryana, Rajasthan, Uttar succeeding
Pradesh, Bihar, Sikkim, Arunachal Pradesh, such
Nagaland, Manipur, Mizoram, Tripura, Meghalaya, quarter.
30

Assam, West Bengal, Jharkhand or Odisha, the
Union territories of Jammu and Kashmir, Ladakh,
Chandigarh or Delhi.
❑ Every registered person required to furnish return15 shall, discharge

their liability towards tax, interest, penalty, fees or any other
amount payable under GST law by debiting the electronic cash
ledger or electronic credit ledger and include the details in the
return.
❑ Every registered person under QRMP scheme shall pay the tax due
under proviso to section 39(7) [discussed subsequently], for each of
the first 2 months of the quarter, by depositing the said amount in
Form GST PMT-06, by the 25th day of the month succeeding such
month.
However, the Commissioner may, on the recommendations of the
Council, by notification, extend the due date for depositing the said
amount in Form GST PMT-06, for such class of taxable persons as may
be specified therein.
Further, any extension of time limit notified by the Commissioner of
State tax/UT shall be deemed to be notified by the Commissioner:
While making a deposit in Form GST PMT-06, such a registered
person may –
(a) for the 1st month of the quarter, take into account the
balance in the electronic cash ledger.
(b) for the 2nd month of the quarter, take into account the
balance in the electronic cash ledger excluding the tax due for
the 1st month.
❑ At the time of filing the return for the said quarter in Form GSTR-
3B, the amount deposited by the registered person in the first 2
months of the quarter shall be debited. This amount is debited
15
subject to the provisions of section 49
31

solely for the purposes of offsetting the liability furnished in that
quarter’s Form GSTR-3B. However, any amount left after filing of
that quarter’s Form GSTR-3B may either be claimed as refund or
may be used for any other purpose in subsequent quarters.
V. Monthly payment of tax
The registered person under the QRMP Scheme would be required to
pay the tax due in 1st month or 2 nd
month or both the months of the
quarter by depositing the tax due16
in Form GST PMT-06. The payment
is to be made by 25th day of the
month succeeding such month.
While generating the challan, taxpayers should select “Monthly
payment for quarterly taxpayer” as reason for generating the challan.
The said person can use any of the following two options provided
below for monthly payment of tax during the first 2 months –
(a) Fixed sum method: If a taxpayer chooses this option, a facility is

available on the GST portal for generating an auto-generated/pre-
filled challan in Form GST PMT-06. The challan amount is calculated
by the system which cannot be edited. The amount is equal to:
(i) 35% of the tax paid in cash in the return for the preceding
quarter where the return was furnished quarterly; or
(ii) tax liability paid in cash in the return for the last month of the
immediately preceding quarter where the return was
furnished monthly.
16
under proviso to sub-section (7) of section 39
32

For easy understanding, the same is explained by way of examples
given below:
(i) In case the last return filed was on quarterly basis for
quarter ending March:
Tax paid in cash in quarter Tax required to be paid

(January - March) in each of the months –
April and May
CGST 100 CGST 35
SGST 100 SGST 35
IGST 500 IGST 175
Cess 50 Cess 17.5
(ii) In case the last return filed was monthly for tax period
March:
Tax paid in cash in March Tax required to be paid in

each of the months – April
and May
CGST 50 CGST 50
SGST 50 SGST 50
IGST 80 IGST 80
Cess - Cess -
However, no such amount may be required to be deposited-

(a) for the 1st month of the quarter, where the balance in the
electronic cash ledger/electronic credit ledger is adequate for
the tax liability for the said month or where there is nil tax
liability;
(b) for the 2nd month of the quarter, where the balance in the
electronic cash ledger/electronic credit ledger is adequate for
the cumulative tax liability for the 1st and the 2nd month of the
quarter or where there is nil tax liability
33

Monthly tax payment through this method would not be available to
those registered persons who have not furnished the return for a
complete tax period preceding such month.
A complete tax period means a tax period in which the person is
registered from the first day of the tax period till the last day of the tax
period.
(b) Self-Assessment Method: The said persons, in any case, can pay the
tax due by considering the tax liability on inward and outward
supplies and the input tax credit available, in Form GST PMT-06. In
order to facilitate ascertainment of the ITC available for the month, an
auto-drafted input tax credit statement has been made available in
Form GSTR2B, for every month.
The registered person under QRMP is free to avail either of the two tax
payment methods above in any of the two months of the quarter.
As already discussed earlier, at the time of filing the return for a quarter in
Form GSTR-3B, the amount deposited by the registered person in the first 2
months of the quarter shall be debited. Further, any amount left after filing
of that quarter’s Form GSTR-3B may either be claimed as refund or may be
used for any other purpose in subsequent quarters.
However, such refund claim shall be permitted only after the return in Form
GSTR-3B for the said quarter has been furnished. Further, this deposit
cannot be used by the taxpayer for any other purpose till the filing of return
for the quarter.
VI. Applicability of interest
A. For registered person making payment of tax by opting
Fixed Sum Method
No interest would be payable in case the tax due is paid in the first 2
months of the quarter by way of depositing auto-calculated fixed sum
amount (as discussed above) by the due date.
In other words, if while furnishing return in Form GSTR-3B, it is
found that in any or both of the first 2 months of the quarter, the
tax liability net of available credit on the supplies made /received
was higher than the amount paid in challan, then, no interest
34

would be charged provided they deposit system calculated amount
for each of the first 2 months and discharge their entire liability for
the quarter in Form GSTR-3B of the quarter by the due date.
In case such payment of tax by depositing the system calculated
amount in Form GST PMT-06 is not done by due date, interest
would be payable at the applicable rate, from the due date of
furnishing Form GST PMT-06 till the date of making such payment.
Further, in case Form GSTR-3B for the quarter is furnished beyond
the due date, interest would be payable as per the provisions of
section 50 of the CGST Act for the tax liability net of ITC.
A registered person, who has opted for the QRMP
Scheme, had paid a total amount of ` 100/- in cash as tax
liability in the previous quarter of October to December.
He opts to pay tax under fixed sum method. He therefore pays `
35/- each on 25th February and 25th March for discharging tax
liability for the first 2 months of quarter viz. January and February.
In his return for the quarter, it is found that liability, based on the
outward and inward supplies, for January was ` 40/- and for
February it was ` 42/-. However, no interest would be payable for
the lesser amount of tax (i.e. ` 5 and ` 7 respectively) discharged in
these 2 months provided that he discharges his entire liability for
the quarter in the Form GSTR-3B of the quarter by the due date.
A registered person, who has opted for the QRMP

Scheme, had paid a total amount of ` 100/- in cash as
tax liability in the previous quarter of October to
December. He opts to pay tax under fixed sum method. He
therefore pays ` 35/- each on 25th February and 25th March for
discharging tax liability for the first 2 months of quarter viz. January
and February.
In his return for the quarter, it is found that total liability for the
quarter net of available credit was ` 125, but he files the return on
30th April. Interest would be payable at applicable rate on ` 55 [`
125 – ` 70 (deposit made in cash ledger in first and second month)]
35

for the period between due date of quarterly GSTR 3B and 30 th
April
B. For registered person making payment of tax by opting Self-
Assessment Method
Interest amount would be payable as per the provision of section
50 of the CGST Act for tax or any part thereof (net of ITC) which
remains unpaid / paid beyond the due date for the first 2 months
of the quarter.
Interest payable, if any, shall be paid through Form GSTR-3B.
VII. Applicability of late fee
Late fee is applicable for delay in furnishing of return / details of
outward supply as per the provision of section 47 of the CGST Act.
As per the QRMP scheme, the requirement to furnish the return under
the proviso to section 39(1) of the CGST Act is quarterly. Accordingly,
late fee would be the applicable for delay in furnishing of the said
quarterly return/ details of outward supply.
It is clarified that no late fee is applicable for delay in payment of tax
in first 2 months of the quarter.
[Notification Nos 82, 84 & 85/2020 CT all dated 10.11.2020 and
Circular No. 143/13/2020 GST dated 10.11.2020]
2. Extension of due date for furnishing Form GSTR-1
Earlier, Notification No. 74/2020 CT dated 15.10.2020 had revised the due
date for filing quarterly GSTR-1 by the registered persons having aggregate
turnover up to `1.5 crores in the preceding financial year or current
financial year to 13 th of the month succeeding the end of quarter. Such
date was to be applicable for the quarters ending December 2020 and
March 2021.
Further, Notification No. 75/2020 CT dated 15.10.2020 had revised the due
date for filing monthly GSTR-1 by the registered persons having aggregate
turnover of more than ` 1.5 crores in the preceding financial year or
current financial year for each of the months from October, 2020 to March,
36

2021 till 11 th day of the month succeeding such month.
The above notifications have been superseded by Notification No.
83/2020 CT dated 10.11.2020 to provide as follows:
With effect from 01.01.2021, the time limit for furnishing the details of
outward supplies in Form GSTR-1 has been extended in the following
manner:
Class of registered person Time limit for furnishing the details

of outward supplies in Form GSTR-1
for each quarter/tax period
Registered persons opting for 13th day of the month succeeding

QRMP scheme such tax period
Others 11th day of the month succeeding

such tax period
37

15
REFUNDS
1. No restriction on recipient of deemed export supplies in availing ITC of
the tax paid on such supplies
As per third proviso to rule 89(1) of the CGST
Rules, in respect of supplies regarded as
deemed exports, either recipient or supplier is
allowed to file the refund application.
However, the supplier can seek refund only in
case where the recipient does not avail ITC on
such supplies and furnishes an undertaking to the effect that the supplier
may claim the refund. Otherwise, recipient of deemed export supplies can
claim the refund.
In view of aforesaid provisions, it has been clarified that:
In a case where recipient of deemed export supplies claims the refund
on such supplies, there is no restriction on such recipient in availing ITC
of the tax paid on such supplies.
[Circular No. 147/03/2021 GST dated 12.03.2021]
38

2. Clarification regarding manner of calculation of ‘adjusted total
turnover’ under rule 89(4)
Rule 89(4) of the CGST Rules provides the formula for
determining the refund of ITC in the case of zero-rated
supply of goods and/or services without payment of
tax under bond/LUT in accordance with the provisions
of section 16(3) of the IGST Act, 2017.
The formula is as follows:
(Turnover of zero-rated supply of goods +

Refund
Turnover of zero-rated supply of services)
Amount = × Net ITC
Adjusted Total Turnover
The term ‘Turnover of zero-rated supply of goods’17 used in the above

formula had been redefined to restrict the same to 1.5 times the value of
like goods domestically supplied by the same/similarly placed supplier/as
declared by the supplier vide Notification No.16/2020 CT dated 23.03.2020.
The term “Adjusted Total Turnover”18 as
defined under rule 89(4) includes
“Turnover in a State or Union Territory”. As
per section 2(112) of the CGST Act. “Turnover in a State or Union
17
Turnover of zero-rated supply of goods means the value of zero-rated supply of goods made
during the relevant period without payment of tax under bond or letter of undertaking or the
value which is 1.5 times the value of like goods domestically supplied by the same or, similarly
placed, supplier, as declared by the supplier, whichever is less, other than the turnover of
supplies in respect of which refund is claimed under rule 89(4A) or 89(4B) or both.
18
Adjusted Total Turnover means the sum total of the value of-
(a) the turnover in a State or a Union territory, as defined under clause (112) of section 2,
excluding the turnover of services; and
(b) the turnover of zero-rated supply of services determined in terms of clause (D) above
and non-zero-rated supply of services,
excluding-
(i) the value of exempt supplies other than zero-rated supplies; and
(ii) the turnover of supplies in respect of which refund is claimed under rule 89(4A) or 89(4B)
or both, if any, during the relevant period.
39

Territory”19 includes turnover/ value of export/ zero-rated supplies of goods.
As seen above, the definition of ‘Turnover of zero-rated supply of goods’
has been amended.
In view of the above, it can be stated that the same value of zero-rated/
export supply of goods, as
calculated as per amended
definition of “turnover of zero-
rated supply of goods”, needs to be taken into consideration while
calculating “turnover in a State or a Union Territory”, and accordingly, in
“adjusted total turnover” for the purpose of rule 89(4).
Thus, the restriction of 1.5 times of the value of like goods domestically
supplied, as applied in “turnover of zero-rated supply of goods”, would also
apply to the value of “adjusted total turnover” in rule 89(4) of the CGST
Rules.
Accordingly, it is clarified that
For the purpose of rule 89(4), the value of export/ zero-rated supply of
goods to be included while calculating “adjusted total turnover” WILL BE
SAME as being determined as per the amended definition of “Turnover of
zero-rated supply of goods” in the said sub-rule.
The same can explained by the following illustration where actual value per
unit of goods exported is more than 1.5 times the value of same/ similar
goods in domestic market, as declared by the supplier:
Illustration
Suppose a supplier is manufacturing only one type of goods and is
supplying the same goods in both domestic market and overseas. During
the relevant period of refund, the details of his inward supply and outward
19
Turnover in State or turnover in Union territory means the aggregate value of all taxable
supplies (excluding the value of inward supplies on which tax is payable by a person on reverse
charge basis) and exempt supplies made within a State or Union territory by a taxable person,
exports of goods or services or both and inter-State supplies of goods or services or both made
from the State or Union territory by the said taxable person but excludes central tax, State tax,
Union territory tax, integrated tax and cess.
40

supply details are shown in the table below:
Net admissible ITC = ` 270
Outward Value per No of units Turnover (`) Turnover as per

Supply unit supplied amended
(`) definition (`)
Local 200 5 1,000 1,000

(Quantity
5)
Export 350 5 1,750 1,500
(Quantity [1.5×(5×200)]
5)
Total 2,750 2,500
The formula for calculation of refund as per rule 89(4) is :

Refund Amount = (Turnover of zero-rated supply of goods + Turnover of
zero-rated supply of services) × Net ITC ÷Adjusted Total Turnover
Turnover of zero-rated supply of goods (as per amended definition) = `
1,500
Adjusted Total Turnover= ` 1,000 + ` 1,500 = ` 2,500 [and not ` 1,000 + `
1,750]
Net ITC = ` 270
Refund Amount = ` (1,500 × 270)/2,500 = ` 162
Thus, the admissible refund amount in the instant case is ` 162.
[Circular No. 147/03/2021 GST dated 12.03.2021]
41

PART II:
CUSTOMS &
FOREIGN TRADE
POLICY
42

1
LEVY OF AND
EXEMPTIONS FROM
CUSTOMS DUTY
Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017,

amended
CBIC vide Notification No. 09/2021 - Customs (N.T.) dated 01.02.2021
has amended the Customs (Import of Goods at Concessional Rate of Duty)
Rules, 2017 (hereinafter referred to as the said rules). These amended rules
may be called the Customs (Import of Goods at Concessional Rate of Duty)
Amendment Rules, 2021.
➢ Amendments in rule 3
The following new definitions have been inserted in Rule 3 containing
definitions
(i) Capital goods: means goods, the value of which is capitalised in the
books of account of the importer.
(ii) Job work: means any treatment, process or manufacture,
consistent with the exemption notification undertaken by a person
43

on goods belonging to the importer except gold, jewellery and
articles thereof, and other precious metals or stones; and the term
“job worker” shall be construed accordingly.
The definition of “manufacture” and “output service” has been
amended as follows:-
“Manufacture” means the processing of raw materials or inputs
by the importer in any manner that results in emergence of a new
product having a distinct nature or character or use or name; and
the term “manufacturer” shall be construed accordingly.
“Output service” means supply of service excluding after-sales
service, utilizing imported goods.‘.
➢ Rule 4 and 6 substituted
In the said rules, for rule 4 and rule 6, the following rule has been
substituted, namely:
“Importer to give prior information [Rule 4] – The importer shall
provide information to the Deputy Commissioner of Customs, or, as
the case may be, the Assistant Commissioner of Customs having
jurisdiction over the premises where the imported goods shall be put
to use for manufacture of goods or for rendering output service
except after-sales service, about the following particulars, namely: —
(i) the name and address of the importer and his job worker, if any;
(ii) the goods produced or process undertaken at the manufacturing
facility of the importer and/or his job worker, if any, or both;
(iii) the nature and description of imported goods used in the
manufacture of goods at the premises of the importer or the job
worker, if any;
(iv) nature of output service rendered utilising imported goods.
➢ Importer to give information regarding receipt of imported goods
and maintain records.[Rule 6] –
(1) The importer shall provide information of the receipt of the imported
goods in the premises, where the imported goods shall be put to
44

use for manufacture of goods or job work or for rendering output
service within two days (excluding holidays, if any) of such receipt
to the Jurisdictional Customs Officer.
(2) The importer shall maintain an account in such manner to clearly
indicate the quantity,-
(i) and value of goods imported;
(ii) of imported goods consumed;
(iii) of goods sent for job work, nature of job work carried out;
(iv) of goods received after job work;
(v) of goods re-exported, if any, under rule 7; and
(vi) remaining in stock, according to bills of entry,
and shall produce the said account as and when required by the
Deputy Commissioner of Customs, or, as the case may be, the
Assistant Commissioner of Customs having jurisdiction over the
premises or where the imported goods shall be put to use for
manufacture of goods or for rendering output service.
(3) The importer shall submit a quarterly return, in the form appended to
these rules to the Deputy Commissioner of Customs, or, as the case
may be, the Assistant Commissioner of Customs having jurisdiction
over the premises where the imported goods shall be put to use for
manufacture of goods or for rendering output service, by the tenth
day of the following quarter;
➢ Insertion of new rule 6A
The following new rule 6A has been inserted in the said rules after rule
(6), namely: —
Procedure for allowing imported goods for job work.[Rule 6A] –
(1) The importer shall send the imported goods except gold, jewellery
and articles thereof; and other precious metals or stones for job work,
for manufacture of goods, after giving an intimation in duplicate to the
Jurisdictional Customs Officer of his intention to do so.
(2) The importer shall also specify the following particulars, namely: —
45

(i) name and address of the job worker;
(ii) nature and description of the job work to be carried on the
imported goods in the manufacturing process;
(iii) quantity and description of the goods intended to be sent to
the job worker.
(3) The Jurisdictional Customs Officer shall forward a copy of the
intimation along with the particulars specified above to the
concerned Customs officer under whose jurisdiction the premises
of the job worker is situated.
(4) The importer shall send the goods to the premises of the job worker
enclosing a challan, specifying the description and quantity of the
goods.
(5) The maximum period for which the goods can be sent to the job
worker shall be six months from the date of issue of challan.
(6) In case the importer is unable to establish that the goods sent for job
work have been used as per the particulars of job work, the
Jurisdictional Customs Officer shall take necessary action against the
importer under rules 8 and 8A.
(7) The job worker shall
(i) maintain an account of receipt of goods, manufacturing process
undertaken thereon and the waste generated, if any, during
such process;
(ii) produce the account details before the Jurisdictional Customs
Officer as and when required by the said officer;
(iii) after completion of the job work send the processed goods
to the importer or to another job worker as directed by the
Importer for carrying out the remaining processes, if any, under
the cover of a challan or the challan of the principal
manufacturer duly endorsed by him.
➢ Insertion of new sub-rule(3) in rule 7
After rule 7(2) the following sub-rule shall be inserted, namely: —
46

Rule 7(3) The importer, with the permission of the jurisdictional
Deputy Commissioner of Customs or, as the case may be, Assistant
Commissioner of Customs having jurisdiction over the premises where
the imported goods shall be put to use for manufacture of goods or
for rendering output service, may clear the imported capital goods,
after having been used for the specified purpose, on payment of duty
equal to the difference between the duty leviable on such goods but
for the exemption availed and that already paid, if any, at the time of
importation, along with interest, at the rate fixed by the notification
issued under section 28AA of the Act, on the depreciated value
allowed in straight line method, as specified below, namely : —
(i) for every quarter in the first year @ 4%;
(ii) for every quarter in the second year @ 3%;
(iii) for every quarter in the third year @ 3%;
(iv) for every quarter in the fourth and fifth year @ 2.5%;
(v) and thereafter for every quarter @ 2%.
Explanation. –
(1) For the purpose of computing rate of depreciation for any part of a
quarter, a full quarter shall be taken into account.
(2) There shall be no upper limit for such depreciation.
(3) The depreciation shall be allowed from the date when the imported
capital goods have come into use for the purpose as specified in
the exemption notification upto the date of its clearance.
➢ Insertion of new sub-rule(2) in rule 8
Rule 8 shall be renumbered as sub-rule (1) thereof and after rule 8(1),
the following sub-rule (2) shall be inserted, namely: —
Rule 8(2) Notwithstanding anything specified in these rules in relation
to removal and processing of imported goods for job work, the
importer shall be responsible for ensuring that the said goods are
used in accordance with the purposes provided in the exemption
notification and in the event of failure to do so, the Jurisdictional
47

Deputy Commissioner of Customs, or, as the case may be, the
Assistant Commissioner of Customs having jurisdiction over the
premises where the imported goods shall be put to use for
manufacture of goods or for rendering output service, shall take
action under these rules, without prejudice to any other action which
may be taken under the Act, rules or regulations made thereunder or
under any other law for the time being in force.
➢ Insertion of new rule 8A
After rule 8, the following new rule 8A shall be inserted, namely: —
Penalty [Rule 8A]. - The importer or a job worker who contravenes
any of the provisions of these rules or abets such contravention, shall
be liable to a penalty to an extent of the amount specified under
clause (ii) of sub-section (2) of section 158 of the Act without
prejudice to any other action which may be taken under the Act, rules
or regulations made thereunder or under any other law for the time
being in force.‖
[Effective from 02.02.2021]
48

8
FOREIGN TRADE
POLICY
1. Duration of applicability of FTP extended till 30.09.2021
Earlier, it was provided that the Foreign Trade Policy (FTP), 2015-2020, (as
updated) w.e.f. 05.12.2017 incorporating provisions relating to export and
import of goods and services, would come into force with effect from the
date of notification and would remain in force up to 31 st March, 2021,
unless otherwise specified.
However, DGFT vide Notification No. 60/2015-20 dated 31 st March 2021 has
amended the said provision and provided that FTP shall remain in force up
to 30th September, 2021, unless otherwise specified.
[Notification No. 60/2015-2020 dated 31.03.2021]
2. Exemption from IGST and GST compensation cess extended upto
30.09.2021 in case of imports under Advance Authorisation, EPCG,
EOU/EHTP/STP/BTP units
Earlier imports against Advance Authorisations for physical exports were
exempted from Integrated Tax and Compensation Cess upto 31.03.2021
only. The exemption from Integrated Tax and Compensation Cess in case of
imports against Advance Authorisations for physical exports has now been
extended upto 30.09.2021.
49

Earlier capital goods imported under EPCG Authorisation for physical
exports were exempted from IGST and Compensation Cess upto 31.03.2021
only. The exemption from IGST and Compensation Cess in case of capital
goods imported under EPCG Authorisation for physical exports has now
been extended upto 30.09.2021.
In case of goods imported by EOU/EHTP/STP/BTP units from DTA, IGST and
GST compensation cess was exempt upto 31.03.2021. The exemption from
IGST and GST Compensation Cess in case of goods imported by
EOU/EHTP/STP/BTP units from DTA has now been extended upto
30.09.2021.
[Notification No. 60/2015-2020 dated 31.03.2021]
3. MEIS replaced with a new scheme with effect from 01.01.2021
Benefits under MEIS are not available for exports made with effect from
01.01.2021. Further, Government has introduced a new scheme Remission
of Duties and Taxes on Exported Products (RoDTEP) to all export goods with
effect from 01.01.2021.
The RoDTEP scheme seeks to refund to exporters the embedded Central,
State and local duties/taxes that were so far not being rebated/refunded.
The refund would be credited in an exporter’s ledger account with customs
and used to pay basic customs duty on imported goods. The credits can
also be transferred to other importers.
An exporter desirous of availing the benefit of the RoDTEP scheme is
required to declare his intention for each export item in the shipping bill or
bill of export. The RoDTEP is allowed, subject to specified conditions and
exclusions
[Notification No. 30/2015-2020 dated 01.09.2020 and Press Release
dated 31.12.2020]
50

Statutory Updates For Nov-21 Exams

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PAPER 8: INDIRECT TAX LAWS

STATUTORY UPDATE FOR NOVEMBER 2021

The following are applicable for November 2021 examination:

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

INPUT TAX CREDIT

1. ITC to be availed in respect of invoices/debit notes not uploaded by the

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

registration is to be granted after 30 days from the date of

[Notification No. 94/2020 CT dated 22.12.2020]

© The Institute of Chartered Accountants of India

avails ITC in violation of the

[Notification No. 94/2020 CT dated 22.12.2020]

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

TAX INVOICE, CREDIT

© The Institute of Chartered Accountants of India

2. Clarification in respect of applicability of Dynamic Quick Response

© The Institute of Chartered Accountants of India

❑ Supplier GSTIN number

Further, Dynamic QR Code should be such that it can be scanned to

© The Institute of Chartered Accountants of India

Case-III: In case of pre-paid invoices i.e. where payment has been

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

1. Validity period of e-way bill or a consolidated e-way bill reduced [Rule

1. Upto 100 Upto 200 km One day in cases other than

2. For every For every 200 One additional day in cases

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

1. Quarterly Return Monthly Payment (QRMP) Scheme

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

© The Institute of Chartered Accountants of India

Month Date of generation of GSTR-2B

July 14th August

August 14th September

September 14th October

© The Institute of Chartered Accountants of India

Class of registered persons Due date

Registered persons whose principal place of 24th day of

© The Institute of Chartered Accountants of India

❑ Every registered person required to furnish return15 shall, discharge

© The Institute of Chartered Accountants of India

(a) Fixed sum method: If a taxpayer chooses this option, a facility is

© The Institute of Chartered Accountants of India

Tax paid in cash in quarter Tax required to be paid