Representation on GST issues faced and request to raise it before Chairman of GST Council and in the Parliament

Ambajogai Tax Practitioners Association, Beed has made a representation on GST issues faced and request to raise it before Chairman of GST Council and in the Parliament.

We, Ambajogai Tax Practitioners Association; Ambajogai, has been formed with the object to educate the tax professionals and make efforts to resolve the issues being faced by the tax professionals and tax payers of Ambajogai taluka Dist- Beed.

Government of India has implemented GST on 1st July 2017. We all supported it and doing day and night efforts for its awareness, implementation and compliance. On time-to-time basis, government is making amendments in GST law, so as to cope up with requirements of taxpayer and professionals.

However till today, some critical below mentioned issues in GST are unanswered and now it is creating big problem for taxpayer and industry. It is now need of hour that government should provide solution on it, else it is creating big chaos and disruption.

We are making request to you to kindly take up below issues to Chairman of GST Council and also raise in parliament:

a) CRORES OF INPUT TAX CREDIT IS DENIED FOR PROCEDURAL LAPS OF TIME LIMITATION, INSPITE OF THE FACT PAYMENT FOR SAID TAX IS RECEIVED BY GOVERNMENT:

• ISSUE FACED:
• As per provisions of Sec 16(4) of CGST Act 2017, Input Tax Credit (ITC) can be availed till maximum September Return due date of next financial year [As per amended provisions, till maximum of November month of next financial year].

However, due to some genuine reasons, some taxpayers have availed Input Tax credit after above mentioned date. Due to this, lakhs and crores of said ITC is denied and demand notices are being issued. Many times, GST officers also discuss in person with us accept that said provision is very harsh in nature and penalising in big way for small lapse.

GST is new law. GST System is also new and changing frequently. Form GSTR 2A was not available in initial period. Most of the tax payers were not conversant with new system and method which also changed very frequently. This has resulted in belated availment of genuine ITC. Also, GST Registration of thousands of Tax payers were cancelled by authorities due to some reason. Afterwards some of these registrations were reinstated/re-activated as a result of appeals/revocation application. However, this resulted into delay in filing of returns and thereby availment of ITC beyond the period mentioned in Sec 16(4). Now all such ITC is denied.

GST is introduced to avoid double taxation, remove cascading of taxes and to make seamless flow of Input Tax Credit. If ITC, of which government has received the payment, is denied for small procedural laps, then the very purpose of introduction of GST is defeated.

RECOMMENDATION:

Today, thousands of Taxpayers are suffering due to strictness of Sec 16(4) of CGST Act 2017. Valid, legitimate Input Tax credit is denied and demand notices in lakhs and crores of rupees are sent to taxpayers, which has made strong impact on survival of such taxpayers.

Therefore, considering urgency and grave impact of said issue, it is strongly recommended to extend date for ailment of ITC for year 2017 to 2023.

b) NO OPTION TO FILE REVISED RETURN UNDER GST, MEANS NO SCOPE FOR MAKING RECTIFICATION OF ERROR AND TO SUBMIT CORRECT DISCLOSURE:

ISSUE FACED:

Every trade, industry and business have different functional system and peculiar problem associated with. Due to which sometimes errors are committed while filing GST Return. However, there is no scope to make rectification of errors. There is no option to rectify values reported in GSTR 3B. This makes small error more complicated as its rectification is not possible. Afterwards, taxpayer receives notice for explanation of said wrong disclosure/error. Also, some time, due to error in return filing, taxpayer is being issued demand notice in lakhs. All this can be avoided if revised return facility is provided in GST.

This demand is there since inception of GST, but it is not provided yet. This is big practical difficulty faced by taxpayer.

RECOMMENDATION:

There should be option to make correct disclosure of particular return. Facility to make correction in mistake committed should be provided to taxpayer. Therefore, it is recommended that, revised return facility should be provided in GST. There should be option to make correct disclosure of particular return.

4. NO POWER GIVEN TO GST OFFICER TO CONDON DELAY OF FILING OF APPEAL

ISSUE FACED:

Time limit for filing of appeals is given under Sec 107 and Sec 112 of CGST Act 2017. Appeal is required to be filed within 3 months from date of communication of order. Further time period of one month is allowed for sufficient cause. However, many taxpayers are unable to file appeal within the above given period. Sometimes there are genuine issues like hospitalisation / accident / family problems. In such case, doors of justice are closed to taxpayer and only recourse
is to file petition in high court, which is not affordable/possible for small genuine tax payer.

RECOMMENDATION:

Therefore, it is recommended that, in such genuine cases, power should be given to appellate authority to condone the delay, in order to open the door of justice to genuine taxpayer.

d) ITC DENIAL IF PAYMENT IS NOT MADE TO SUPPLIER WITHIN 180 DAYS

ISSUE FACED:

As per Sec 16 of CGST Act 2017, ITC is required to be reversed if payment is not made to supplier within 180 days, from the date of invoice. However, it can be reclaimed after payment to supplier. This provision is inserted for supporting MSME. However, said provision instead of supporting MSME, it is attracting big demand notices to MSME. Sometime, MSME has financial stress and due to which he is unable to pay to supplier within reasonable time. Most of the time,
supplier also understand said issue and allow extra credit period to buyer.

In such scenario, where there is acceptance between supplier and buyer about credit period, GST law mandate that payment should be made to supplier within 180 days, else Input Tax Credit is required to be reversed.

RECOMMENDATION:

It is strongly recommended that GST Law should not specify time limit for payment to supplier. Sometime supplier himself allow credit period of more than 1 year in case of capital goods. There is other law to govern payment compliance (MSME Act) and therefore it is recommended that GST law should not specify any time limit for payment to supplier. This provision instead of helping MSME, is
adding additional burden on MSME by way of GST Demand notice. Therefore, it is recommended said time limit of 180 days should be removed or it should be atleast extended to 1 year and also if confirmation obtained from supplier about additional credit period, ITC reversal should not be asked.

DUE TO UNUNIFORM METHOD IN SERVICE OF NOTICE, GST NOTICES ARE UNATTENDED, RESULTING IN BANK ATTACHMENT AND NON FILING OF APPEAL:

ISSUE FACED:

GST officers are sending GST notices either on email or by post or uploaded on GST Portal. Therefore, is no uniform practice of sending notice in any mode. Every officer follows different method. Many times, notices are uploaded on GST Portal or sent on email, remain unattended as taxpayer is not aware of said notice. Afterwards, since taxpayer has not submitted reply to said notice (as he is unaware of said fact of notice), his bank account is attached or right to file appeal
denied due to lapse of time limit. Also, CGST authorities and SGST authorities of different region are following different practice in this regard. Due to which said notice miss attention of taxpayer and this is main reason for not replying to notices or filing of appeal within time limit.

RECOMMENDATION:

It is recommended that to make it compulsory to send physical copy of notices and orders at business premises of tax payer. Also give all notices with flashing tag/mark on GST Portal Home login page and also send SMS Alert Frequently for pending notices.

f) SINCE NOW EINVOICE IS MADE APPLCIABLE TO ALMOST ALL TAXPAYERS, E WAY BILL NOT TO BE REQUIED. THIS IS AMOUNTING TO DUPLICATION OF WORK AND DOCUMENTS:

ISSUE FACED:

Currently E Invoice is made applicable to all Tax payers having turnover more than Rs 5 Crore. E Invoice and E Way bill contain 99% same information. However, still both the documents are required to be complied with, resulting in increase of compliance and documentation.

In 2019 Business Speech, Honourable Finance Minister in her speech in Parliament has categorically said that, “There will be no need for a separate e-way bill”, once E Invoice is introduced. However, till date both documents, Invoice and Eway bill are asked from Taxpayers and Transporter.

RECOMMENDATION:

For taxpayer to whom E Invoice is made applicable, for him E Way bill should be relaxed, since both the documents are serving the same purpose.

We request you to kindly take up above issues with GST Council and raise in the parliament. Tax payer, Industry, Trade and we Tax professional are eagerly waiting for solution of said issue since long.