GST Update No 240 on rationalisation of GST on fly ash bricks

The ambiguity as regards applicability of GST rate on fly ash bricks is prevalent in the minds of taxpayers since complicated amendment was made simultaneously vide notification no. 04/2022-Central Tax dated 31.03.2022, 03/2022-Central Tax dated 31.03.2022, 01/2022-Central Tax (Rate) and 01/2022-Integrated Tax (Rate) and 02/2022-Central Tax (Rate) and 02/2022-Integrated Tax (Rate) dated 31.03.2022. The in-depth analysis of the amendments carried out by the above-mentioned notifications can be referred in our earlier GST Update No. 172 titled “Complicated Re-structuring of rates for fly ash bricks.” Recently, in the 47^th GST Council meeting, the issue was addressed again and the GST rates on fly ash bricks have been rationalised further. Therefore, CBIC issued couple of notifications in the similar fashion vide Notification No. 06/2022-Central Tax (Rate) dated 13.07.2022, Notification No. 10/2022-Central Tax (Rate) dated 13.07.2022, Notification No. 15/2022-Central Tax dated 13.07.2022 and Notification No. 16/2022-Central Tax dated 13.07.2022. The detailedanalysis of these notifications is the subject matter of discussion of our present update.

We hereby provide the comparative analysis of the amendments made in this regard as follows:-

OLD PROVISION	Notification No. 01/2022-Central Tax (Rate) dated 31.03.2022	This notification seeks to prescribe CGST rate of 6% with ITC on “fly ash bricks or fly ash aggregate with 90% or more fly ash content; fly ash blocks”
NEW PROVISION	Notification No. 06/2022-Central Tax (Rate) dated 13.07.2022	The amended provision seeks to delete the condition of 90% or more fly ash content thereby leading to the conclusion that the GST rate of 6% with ITC would be applicable for fly ash bricks, fly ash aggregates, fly ash blocks.

OLD PROVISION

Notification No. 02/2022-Central Tax (Rate) dated 31.03.2022

This notification seeks to prescribe the CGST rate of 3% on “fly ash bricks or fly ash aggregate with 90% or more fly ash content; fly ash blocks” with the condition that credit of input tax charged on goods or services used exclusively in supplying such goods has not been taken. Moreover, such goods are to be considered as exempt supply attracting the provisions of credit reversal as contained in section 17(2) of the CGST Act, 2017.

NEW PROVISION

Notification No. 10/2022-Central Tax (Rate) dated 13.07.2022

The amended provision seeks to delete the condition of 90% or more fly ash content thereby leading to the conclusion that the concessional rate of 3% would be applicable for fly ash bricks, fly ash aggregates, fly ash blocks.

OLD PROVISION

Notification No. 03/2022-Central Tax dated 31.03.2022

[Principal Notification No. 10/2019-Central Tax dated 07.03.2019]

The enhanced threshold limit of Rs. 40 Lakhs will not be applicable for goods such as “fly ash bricks or fly ash aggregate with 90% or more fly ash content; fly ash blocks” whereas the general threshold exemption of Rs. 20 Lakhs would be applicable for the suppliers of said goods.

NEW PROVISION

Notification no. 15/2022-Central Tax dated 13.07.2022

The amended provision seeks to delete the condition of 90% or more fly ash content thereby leading to the conclusion that the enhanced threshold limit of Rs. 40 Lakhs would not be applicable for fly ash bricks, fly ash aggregates, fly ash blocks.

OLD PROVISION

Notification No. 04/2022-Central Tax dated 31.03.2022

[Principal Notification No. 14/2019-Central Tax dated 07.03.2019]

This notification seeks to amend notification no. 14/2019-Central Tax dated 07.03.2019 wherein the threshold limit for availing composition scheme benefit under section 10 of the CGST Act, 2017 was extended to Rs. 1.5 Crores. This notification debars the manufacturers of “fly ash bricks or fly ash aggregate with 90% or more fly ash content; fly ash blocks” from availing the benefit of composition scheme thereby meaning that only traders can opt for composition scheme.

NEW PROVISION

Notification no. 16/2022-Central Tax dated 13.07.2022

The amended provision seeks to delete the condition of 90% or more fly ash content thereby leading to the conclusion that the manufacturers of fly ash bricks, fly ash aggregates, fly ash blocks are debarred from availing benefit of composition scheme and only traders can opt for the same.

The above initiative of the government in deleting the condition of having 90% or more fly ash content is welcoming as it seeks to bring uniformity and avoid confusion.

Comments

GST Update No 240 on rationalisation of GST on fly ash bricks

Post a Comment

Query