Makeshift

Edition
By

Adv. (CA) Ranjan Mehta

 Table of Contents

S.No. Contents Pg. No.

I. Rate Changes in GST 1

II. Amendments in Exemptions 2

III. Other Changes 3

IV. GST rate of 5% has been set up in these cases 5

V. GST rate of 12% has been set up in these cases 6

VI. Other Changes in GST Rates 6

VII. Circulars 8

VIII. Notifications 11

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 Rate Changes In Gst
I. RATE CHANGES IN GST:

1. GST rates on all types of Works Contracts have been made to 18% except the
cases where the earthwork is more than 75% of the value of works contract including
the sub-contractors.
In the case of such cases of Works Contract up to 75% of value of Works Contract,
the rate of tax has been increased to 12%.
GST rate on Construction activities to remain as per previous scheme.

2. GST rate on all Hotel Rooms up to Rs. 7500 has been revised to 12%. No Basic
threshold now.

3. GST rate on Ropeways for Passenger Travel – 5%

4. GST on GTA services has been given a new feature:

GTA under Reverse Charge 5% (Without ITC to Service Provider

GTA under Forward Charge 5% (Without ITC to Service Provider

GTA under Forward Charge 12% (With ITC)

The Taxpayers opting for forward charge shall have the option to choose every
nancial year.

Also, a declaration is required to be given in the Invoice by the such Supplier:

Declaration

“I/we have taken registration under the CGST Act, 2017 and have exercised
the option to pay tax on services of GTA in relation to transport of goods
supplied by us during the Financial Year _____ under forward charge”.

5. New category of Renting of Goods Carriage in case where the cost of fuel is
included has been introduced at the rate of 12%. Earlier this was taxed @18%. Now it
is at par with GTA service.

6. Supporting Service for Transport in all the cases be taxed @18%. GTA has been
removed from 9965 to rationalise the tax rates.

7. Chit Fund – GST rate is now 18%.

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8. Job Work / Manufacturing Services - Processing of hides, skins and leather,
manufacture of leather goods or foot wear and manufacture of clay bricks – GST rate
has been increased to 12%/18%. If the work is related to Job Work – 12% and Other
Manufacturing -18% as per Circular No. 126.

9. Services provided by a clinical establishment by way of providing room

having room charges exceeding Rs. 5000 per day to a person receiving health care
services – 5% (without ITC) Except ICU/CCU/ ICCU/NICU.

10. Services by way of treatment or disposal of biomedical waste or the processes

incidental thereto by a common bio-medical waste treatment facility to a clinical
establishment – 12%

11. The term print media has been properly explained to exclude business
directories, yellow pages and trade catalogues which are primarily meant for
commercial purposes so that the concessional rate benet is not extended to these
entities.

II. AMENDMENTS IN EXEMPTIONS:

1. All services provided by Department of Post are now taxable.

2. Residential Dwelling provided to Registered person are now taxable under

Reverse Charge. However, now the issue will arise that what happens that of
such rental services are availed by the Registered person for personal
purpose.

3. No exemption now on Hotel Services below Rs.1000.

4. Business Class Travel from / to North-Eastern States, Sikkim etc. now taxable.

5. Transportation by Railway of Railway equipment and material – Now Taxable.

6. Exemption of Rs. 750 and 1500 now removed from GTA Services – All GTA
services are taxable as per scheme discussed before.

7. Storage of nuts, spices, copra, sugarcane, jaggery, raw vegetable bres such as
cotton, ax, jute etc., indigo, unmanufactured tobacco, betel leaves, tendu leaves,
coffee and tea becomes taxable.

8. Services of RBI, SEBI, IRDA, GSTN or FSSAI now become taxable

9. Service by Tour Operator to Foreign tourist in relation to service performed

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outside India is now exempt.

10. Services of fumigation in a warehouse of agricultural produce is now taxable.

11. Services of Slaughtering of animals is now exempt.

12. Services of Cord Blood Bank is now taxable.

III. OTHER CHANGES:

1. Rate of tax on supplies made to Specied Petroleum Operations now increased

from 5% to 12%.

2. NO REFUND of Inverted Duty Structure will be allowed in relation to various

types of Oils and Coals, Lignite, Peat etc.

3. Fly Ash Bricks, Fly Ash Aggregates and Fly Ash Blocks has been notied to be
separate commodities in order to provide clarity. Condition of 90% removed.

4. All concessions related to various supplies of goods or services provided to various

research institutions have now been ended. Now no benet shall be available in those
cases w.e.f. 18.07.2022.

5. Changes in GST Rates of Pre-packaged and Labelled Commodities

The Government has changed the GST rate on various goods which are pre-packaged
and labelled. The term pre-packaged and labelled has been dened in the Notication
as the denition in clause (l) of section 2 of the Legal Metrology Act, 2009 and it also
states that where, the package in which the commodity is pre-packed or a label
securely afxed thereto is required to bear the declarations. The said declarations are
contained in The Legal Metrology (Packaged Commodities) Rules, 2011.

The provisions of the said Packaged Commodity Rules, 2011 require various
declarations to be put up on such pre-packaged commodity. There are 2 types of
packages – Retail and Wholesale and both require separate declarations. The
conditions of both types of packages are as follows:

Chapter II

PROVISIONS APPLICABLE TO PACKAGES INTENDED FOR RETAIL

SALE

3. Applicability of the Chapter

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 Rate Changes In Gst
The provisions of this Chapter shall not apply to,-

(a) packages of commodities containing quantity of more than 25 kg or 25 litre

excluding cement and fertilizer sold in bags up to 50 kg; and

(b) packaged commodities meant for industrial consumers or institutional

consumers.

CHAPTER III

PROVISIONS APPLICABLE TO WHOLESALE PACKAGES

24. Declarations applicable to be made on every wholesale package Every

wholesale package shall bear thereon a legible, denite, plain and
conspicuous declaration as to….

The denitions of Retail and wholesale Packages are as follows:-

(k) “retail package” means the packages which are intended for retail sale to the
ultimate consumer for the purpose of consumption of the commodity contained
therein and includes the imported packages : Provided that for the purposes of this
clause, the expression 'ultimate consumer' shall not include industrial or
institutional consumers;

(r) “wholesale package” means a package containing-

(i) a number of retail packages, where such rst mentioned package is intended for
sale, distribution or delivery to an intermediary and is not intended for sale direct to
a single consumer; or

(ii) a commodity sold to an intermediary in bulk to enable such intermediary to sell,

distribute or deliver such commodity to the consumer in smaller quantities; or,

(iii) packages containing ten or more than ten retail packages provided that the
retail packages are labeled as required under the rules.

In the said Rules there is exemption available in the agricultural form produces in
packages of above 50 kg.

Therefore, in a nutshell all the goods which are pre-packaged in a specic quantity as
per the Legal Metrology Act, 2009 are liable to be taxed as are falling in the following
entries except in the above said specic exemptions. Now based on this the following
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products are not required to be taxed:

a. The package is not a retail package i.e., above 50 Kg.

b. The package is covered under exemptions i.e., less than 10 ml or 10 gm or

Agriculture Farm Produce above 50 Kgs.

Very Important
Now, there is no condition regarding branding and non-branding, therefore now all
packages can bear the brand and also there is no declaration for foregoing the right of
claim under Brand, which is required to be written on the package.

VI. GST RATE OF 5% HAS BEEN SET UP IN THESE CASES:

1. Meat and related products (Other than Fresh or Chilled): Tariff 0202, 0203,
0204, 0205, 0206, 0207, 0208, 0209, 0210

2. Fish and Related Products (Other than fresh or chilled):- Tariff 0303,
0304,0305, 0306,0307, 0308, 0309

3. Curd, Lassi, Buttermilk - Tariff – 0403

4. Chena or paneer - Tariff – 0406

5. Natural Honey – Tariff -0409

6. Dried leguminous vegetables, shelled, whether or not skinned or split –

Tariff – 0713

7. Manioc, arrowroot, salep, Jerusalem artichokes, sweet potatoes and

similar roots and tubers with high starch or inulin content, frozen, whether
or not sliced or in the form of pellets – tariff – 0714

8. Dried makhana, whether or not shelled or peeled– Chapter – 08

9. Cereals, Wheat and meslin, Rye, Barley, Oats, Maize (corn), Rice, Grain
sorghum, Buckwheat, millet and canary seed; other cereals such as Jawar,
Bajra, Ragi

10. Wheat or meslin our

11. Cereal ours other than of wheat or meslin i.e., maize (corn) our, Rye
our, etc.
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12. Cereal groats, meal and pellets, including suji and dalia,

13. Meal, powder, Flour, akes, granules and pellets of potatoes

14. Meal and powder of the dried leguminous vegetables of heading 0713
(pulses) [other than guar meal 1106 10 10 and guar gum rened split 0713], of sago or
of roots or tubers of heading 0714 or of the products of Chapter 8,

15. Jaggery of all types including Cane Jaggery (gur), Palmyra Jaggery, pre-
packaged and labelled; Khandsari Sugar, pre-packaged and labelled

16. Puffed rice, commonly known as Muri, flattened or beaten rice, commonly
known as Chira, parched rice, commonly known as khoi, parched paddy or rice
coated with sugar or gur, commonly known as Murki

17. Namkeens, bhujia, mixture, chabena and similar edible preparations in

ready for consumption form other than pre-packaged and labelled.

18. Animal or vegetable fertilisers or organic fertilisers – Tariff 3101

19. All goods [other than coconut coir bre] including yarn of ax, jute, other
textile bast bres, other vegetable textile bres; paper yarn, including coir
pith compost – Tariff 5305 or 5308

V. GST RATE OF 12% HAS BEEN SET UP IN THESE CASES:

a. Tender coconut water

b. Namkeens, bhujia, mixture, chabena and similar edible preparations in ready for
consumption form [other than roasted gram] – which is pre-packed and labelled

VI. OTHER CHANGES IN GST RATES:

a. Tar distilled from coal, from lignite or from peat - Rate Increased to 18% from 5%

b. Ostomy appliances including pouch or ange, stoma adhesive paste,

barrier cream, irrigator kit, sleeves, belt, micro-pore tapes – Made Taxable
@5%. In Ostamy appliances the rate has been reduced from 12%.

c. Leather, Chamois Leather – Rate increased to 12% from 5%

d. Solar water heater and system - Rate increased to 12% from 5%

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e. Machines for cleaning, sorting or grading, seed, grain or dried leguminous
vegetables; machinery used in milling industry or for the working of cereals or dried
leguminous vegetables other than farm type machinery and parts thereof - Rate
increased to 18% from 5%

f. E-waste Explanation: For the purpose of this entry, e-waste means electrical and
electronic equipment, whole or in part if discarded as waste by the consumer or bulk
consumer Rate increased to 18% from 5%

g. Orthopaedic appliances, such as crutches, surgical belts, and trusses; Splints and
other fracture appliances; articial parts of the body; other appliances which are worn
or carried, or implanted in the body, to compensate for a defect or disability;
intraocular lens [other than hearing aids] – New Item introduced at 5% - Earlier
these items were covered in List 3 being covered under heading 90.21 – 5%
was applicable on all such items – Now specic items are only covered

h. Mangoes (other than mangoes sliced, dried) – Taxable @12%

I. All Goods, including printing ink, writing or drawing ink and other inks, whether or
not concentrated or solid, fountain pen ink, ball pen ink - Rate increased to 18%
from 12%

j. Aseptic packaging paper - Rate increased to 18% from 12%

k. Maps and hydrographic or similar charts of all kinds, including atlases, wall maps,
topographical plans and globes, printed - Rate Increased to 12% from NIL

l. Fly ash bricks; Fly ash aggregates; Fly ash blocks – Condition of 90% removed

m. Knives with cutting blades, serrated or not (including pruning knives), other than
knives of heading 8208, and blades therefor, Paper knives, Pencil sharpeners and
blades therefor, 8215 Spoons, forks, ladles, skimmers, cake-servers, sh-knives,
butter-knives, sugar tongs and similar kitchen or tableware Power driven pumps
primarily designed for handling water, namely, centrifugal pumps (horizontal and
vertical), deep tube-well turbine pumps, submersible pumps, axial ow and mixed
ow vertical pumps 8414 20 10 Bicycle pumps - Rate increased from 12% to 18%.

n. Parts of air or vacuum pumps and compressors of bicycle pumps - Rate increased
from 12% to 18%.

o. Milking machines and dairy machinery - Rate increased from 12% to 18%.

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 Rate Changes In Gst
p. LED lamps - Rate increased from 12% to 18%.

q. Drawing and marking out instruments; Mathematical calculating instruments;

pantographs; Other drawing or marking out instruments - Rate increased from
12% to 18%.

r. Splints and other fracture appliances; articial parts of the body; other appliances
which are worn or carried, or implanted in the body, to compensate for a defect or
disability; intraocular lens [other than orthopaedic appliances, such as crutches,
surgical belts, and trusses, hearing aids - Rate decreased from 12% to 5%.

s. LED lights or xtures including LED lamps Rate increased from 12% to 18%.

t. LED (light emitting diode) driver and MCPCB (Metal Core Printed Circuit Board) -
Rate increased from 12% to 18%.

u. Cheques, lose or in book form - Now Taxable 18%

v. Changes in Diamonds taxation:

New schedule inserted -
All goods of Chapter 7102 and 7104 (Diamonds and Precious Semi-Precious
Stones) are now taxable at 1.5%, except:

a. Rough diamonds or simply sawn diamonds, industrial or non-industrial

b. Synthetic or reconstructed precious or semiprecious stones [other than

diamonds], whether or not worked or graded but not strung, mounted or set;
ungraded synthetic or reconstructed precious or semiprecious stones [other than
diamonds], temporarily strung for convenience of transport; synthetic or
reconstructed diamonds, unworked or simply sawn or roughly shaped

These are taxable @ 0.25% after the amendment, rest all are taxable at 1.5%.

VII. CIRCULARS:

1. Circular No. 170/02/2022-GST:

The said circular provides clarications regarding 2 aspects which are –

A. Place of Supply – i.e., every tax payer will have to report the place of Supply made to
the Unregistered person, in order to properly calculate IGST payable to various
states.

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 Rate Changes In Gst
B. Ineligible ITC – the Department has notied a new format of reporting the
ineligible ITC of the Registered person, in Table 4 of FORM GSTR-3B. Which is as
below –

4A ITC Available

4B(1) Ineligible ITC

4B(2) Reversal of ITC of Pre-period

4C = [4A – {4B (1) + 4B (2)}]

4D(1) Reclaim of ITC

4D(2) Others

C. Reversal of ITC of Ineligible Credit under Section 17(5) or any other provision
should be made under Table 4(B) and not under Table 4(D) of FORM GSTR-3B.

2. Circular No. 171/03/2022-GST:

This Circular provides clarications on issued pertaining to imposition of Demand
and Penalty under the CGST Act, 2017 in respect of transactions involving Fake
Invoicing –

The undermentioned situations have been identied in the circular to provide clarity
on the impositions of the registered persons engaged in the practices of Fake Invoicing

Situation 1

Where A provides a fake Invoice to B, without any underlying supply.

No penal action against either under Section 73 and Section 74
Action on A = Imposition of Penal action under Section 122 (1)(ii)
Action on B = No Action

Situation 2

Where A provides a fake Invoice to B, without any underlying supply which B has
forwarded to C along with underlying supply of goods and services or both to C. B has
also availed ITC on the same goods based on the Invoice received from A.
Action on B - Imposition of Penal Action under Sec 74, Liable for Demand and
Recovery as well
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Situation 3

Where A provides a fake Invoice to B, without any underlying supply which B has
forwarded to C, without any underlying supply and issues fake invoices for the same.
B claims ITC on the same and passes ITC to C as well.

Action on B - Imposition of 122(1)(ii) and 122(1)(vii)

Any person who has retained the benet of transactions specied under
sub-section (1A) of section 122 of CGST Act, shall also be liable for penal
action under the provisions of the said sub-section. Provisions of Section
132 can also be invoked based on facts and circumstances.

3. Circular No. 172/04/2022-GST:

Clarications regarding various issues pertaining to GST have been answered

herewith –

1. The CBIC has claried that the ITC availed by the recipient of deemed export
supply would not be subjected to the provisions of Section 17, as the said amount is a
mere refund and not ITC. The same ITC is not to be included in the “Net ITC” for
computation of refund of unutilised ITC on account of zero-rated supplies under Rule
89(4) or on account of inverted duty structure under Rule 89(5) of the CGST Rules,
2017.

2. Clarications regarding the scope of ITC as per Section 17(5) of the CGST Act has
been widened as now ITC will be available on Goods and Services which are obligatory
for an employer to be provided to the employee under any Law, for example, as per the
factories act, the employer is under a mandate to provide means to the Employee.

3. Clarication of Leasing as per Section 17(5)(b)(I) – it has been provided that

leasing in respect of Motor vehicles, vessels and aircrafts and not to leasing of any
other items.

4. It has been claried that the perquisites provided by the employer to the
employee as per the contractual agreement will not be subjected to GST. GST is not
applicable on services rendered by employee to employer provided they are in the
course of or in relation to employment.

5. Clarication regarding payment towards output tax, in return or payable as a

consequence of any proceeding under the provisions of GST Laws, can be made by
utilisation of credit available in the electronic credit ledger of the registered person.

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4. Circular No. 173/05/2022-GST:

● The refund of accumulated ITC under clause (ii) of sub-section (3) of section 54 of
the CGST Act would not be applicable in cases where the input and the output
supplies are the same in case of inverted duty structure.

● In case of Inverted Duty Structure where the rate of tax of output supply is less
than the rate of tax on inputs at the same point of time due to supply of goods by the
registered person under such concessional notication, the ITC can be refunded
according to the provisions of clause 54(3)(ii).

5. Circular No. 174/06/2022-GST:

The circular pertains to the process of Recredit of Refund erroneously claimed &
deposited back. As per this circular a new form, GSTPMT-03A will be made available
to the tax payer, which needs to be lled in order to request such a re-claim. On the
satisfaction of the Proper ofcer such re-credit will take place.

6. Circular No. 175/07/2022-GST:

The said circular pertains to provide clarications for the ling for registered persons
engaged in Export of Electricity.

7. Circular No. 176/08/2022-GST:

This circular rescinded Circular No. 106/25/219-GST dated 29.06.2019 which

provided clarications pertaining to Rule 95A of the CGST rules, for refund of taxes
paid on inward supply of native goods by retail outlets in the departure area of the
international airport.
The withdrawal has been given a retrospective effect from 05.07.2022. It has also
been stated that a new clarication will be issued soon.

VIII. NOTIFICATIONS:

1. Notication No. 09/2022-Central Tax:

Amendment of Section 49(2): Now the ITC which is self-assessed in the returns of a
registered person shall be credited to electronic credit ledger, in accordance with
provisions of Section 41 only.

This notication has notied amendments to two sections brought in by the Finance
Act 2022, of Section 49(10) & Section 50(3) of the CGST Act, 2017.

a. Section 49 (10) - Allow transfer of amount available in electronic cash ledger under
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the CGST Act of a registered person to the electronic cash ledger under the said Act or
the IGST Act of a distinct person.

b. Section 50 (3) - ITC Wrongly availed & Utilised - A taxable person who makes an
undue or excess claim of input tax credit under Section 42(10) or undue or excess
reduction in output tax liability under Section 43(10), shall pay interest on such
undue or excess claim or on such undue or excess reduction.

2. Notication No. 10/2022-Central Tax:

This notication exempts registered person having aggregate turnover in the
nancial year 2021-22 up to Rs. 2 crores from lling annual returns for the said
nancial year.

3. Notication No. 11/2022-Central Tax:

This notication grants extension for lling FORM GST CMP-08 to composition tax
payers for this quarter from 30th June 2022 till 31st July 2022.

4. Notication No. 12/2022-Central Tax:

The late fee payable for delay in furnishing of FORM GSTR-4 for the Financial Year
2021-22 under Section 47 of the said Act shall stand waived for the period from 1st
May 2022 till 30th June 2022.

5. Notication No. 13/2022-Central Tax:

Department has by the virtue of this notication extended the period of limitation till
30th September 2023, keeping the covid period out of the prescribed period for both
the department and the registered persons to undertake their compliances in relation
to:
(a) recovery of tax not paid or short paid or of input tax credit wrongly availed or
utilized;
(b) recovery of erroneous refund;
(c) computation of period of limitation for ling refund application under section 54 or
section 55 of the said Act.

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