GST India Updates | GST Eway Bill | Anti-profiteering | Transitional Credit

The fiscal year 2017-18 ended after the tumultuous implementation of the Goods and Services Tax – GST India. Many provisions of which are still being implemented. Witnessing the present situation; businesses are still confused about carrying out its operational function in India.

Stepping into new financial year; GST India has got some new rules and regulations, challenges and also solutions for the businesses. Let’s have a look: 

1.E-Way Bill introduced under GST regime rolled out at the national level

The Electronic Way -E-Way Bill introduced under the GST India regime. It was rolled out across the country from April 1, on its second attempt at implementation following an earlier start in February. The E-Way Bill, at present, applies to interstate transportation of goods worth over Rs 50,000 through road, railways, airways, and vessels.

For intra-state movement of goods, the new system would be launched in 2 weeks.

Things to know about E-way bill GST India:

• An individual with GSTIN can enroll as a transporter to file the same
• The transporters have to link their “transporter id” with each and every EWB
• A single e-way bill applies even in cases of a break in the journey to the destination and where more than one transporter is involved in the transportation of goods under this system.
• E-way bill cannot be deleted or corrected once it has been generated. The e-way bill can only be canceled, and then a new e-way bill needs to be generated containing the correct details.
• E-way bill should be canceled within 24 hours of its generation and it can be canceled only by the person who generated the e-way bills.
• The e-way bill is required for taxable goods even if the supplier is not liable to GST. The e-way is necessary to show even if you are provider where “goods” are involved when offering the services.
• You need to generate EWB in case of stock transfers, service tools, job work, contractual services, the return of material, damage / rejected or returns as well as on capital goods.
• The validity period of e-way bill starts only after the e-way bill details are updated by the transporter for the first time
• In case of movement of goods on account of job-work, the registered job worker can also generate an e-way bill.
• The validity of the e-way bill or consolidated e-way bill depends upon the distance the goods have to be transported.
• The validity is one day up to 100 km and for every 100 km or part thereafter it is one additional day.
• Part-A Slip is a temporary number generated after entering all the details in PART-A. This can be shared or used by transporter or yourself later to enter the PART-B and generate the E-way Bill.
• Once the goods are ready for movement from the business premises, the user can enter the Part-B or vehicle details and generate the e-way bill for movement of goods. Hence, Part-B details convert the Part-A slip into an e-way bill.

Few concerns E-way bill GST is:

• Without an adequate strengthening of the back-end infrastructure may result in further delays
• A certain class of transporters may be required to install a unique Radio Frequency Identification Device on their vehicle and map their e-Way Bill to this RFID.
• Many transporters and traders are wary about the complexities involved in the e-Way management mechanism.
• E-Commerce involves the return and cancellation of ordered products. This would lead to the generation of a lot many e-Way Bills and E-Commerce retailers will be able to generate e-Way bills.

GST Council has given an option that an unregistered person can also generate an e-Way Bill. But the procedure for the generation of the e-Way Bill in such a scenario has not been clearly stated

Resources are working to make the e-way transition smooth as far as possible. With few glitches; they are consistently working to improve and make it helpful in generating EWB. It is believed that if the e-way bill platform is implemented and monitored well, it will put a tab on the possibility of tax leakages while making it simpler for businesses and supply chains to operate. The data generated through this will help understand the transit time issues, check the supply chains that operate outside of tax network and promote digitization.

2. Anti-profiteering clause

As taxes on several consumer goods fell under GST India, the government made legal provisions to punish companies that keep the tax difference as profit for themselves. Established brands like Hindustan Unilever,  McDonald’s are being scanned under the anti-profiteering clause. However, indirect tax experts point out that there is no clear legal definition of anti-profiteering in the GST Act.

The Act has not even defined how long after the new taxes were introduced could a change in prices be seen as an attempt to profit from lower taxes. Besides, procedures for how fines collected from offending companies are to be used are unclear.

Government Order For GST Anti-Profiteering

If in case, the manufacturer of the trader is not obedient to the rules, then the National Anti Profiteering Authority can order for certain rules and provision nationwide i.e.

• Price Decrease announcement
• The benefit with 18 % interest
• Penalty
• License cancellation of the faulty manufacturer

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The consumer can file his complaint to the committee and if the nature and effect of the complaint are nationwide than the Standing committee must be contacted while if in case the nature and effect of the complaint are on the regional level than the State screening committee will take a decision on the concerned matter.

3. Transitional credit an another challenge

FMCG and other such companies are still finding it hard when filing claims. The companies are still filing claims for inputs used in the weeks right before GST was introduced. For the same reasons; the companies are under government scrutiny for generating fake transitional credit claims.

The officials will be verifying the claims made under transitional credit exceeding Rs25 lakh, or where the central VAT claims between October 2016 and June 2017 has grown by more than 25%.

This has led several companies to challenge the provision, including a case in the Gujarat High Court which ruled on 22 March that the government cannot deny transitional credit because it is a vested right for companies, meaning it cannot be taken away without the consent of the companies involved. How the government will be treating transitional claims is unclear, as now blocking companies claims and GST revenue collections.

The GST Council in the recent meet had approved the changes to the GST law suggested by the law review committee. These will now be vetted by the legislative department, approved by the GST Council and brought in an amendment bill in the second half of the budget session.

Have Questions About New GST India Updates? 

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