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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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GST Update on Circular No. 61/2018-GST dated 04.09.2018

GST Update on Circular No. 61/2018-GST dated 04.09.2018
This circular has been issued by the government in order to clarify on certain issues pertaining to E-way bill in case of storing of goods in godown of transporter as prescribed in the Circular No. 61/2018-GST dated 04.09.2018. This circular is being issued for small textile trader or processors who purchase the material but do not take delivery as there is scarcity of space in their premises. They keep the same in the godown of transporter. Later on, whenever the material is required then they take the delivery from the godown itself. But this practice was not allowed as per GST law. Hence they have sought the clarification from the CBIC.
The Government had received many representations for clarifications regarding the compliance of E Way Bill procedures if the goods are stored at the transporter’s godown on temporary basis. In this regard, the government has clarified that in case where consignee/ recipient taxpayer stores his goods in the godown of the transporter, then the transporter’s godown has to be declared as an additional place of business by the recipient taxpayer. The above interpretation has been adopted on the grounds of  Section 2(85) of the CGST Act that defines the “place of business” to include “a place from where the business is ordinarily carried out, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both”.
An additional place of business is the place of business from where taxpayer carries out business related activities within the state, in addition to the principal place of business. In our case since the recipient taxpayer is storing their goods in the godown of the transporter in the same city, hence this godown has to be declared as an additional place of business by the recipient.
The supplier of goods will send the goods to this small tax payer and will declare the godown of tax payer as destination as it is declared as additional place of business. The delivery will be concluded as and when it reaches the godown of transporter. Further, whenever the goods are taken from the transporters’ godown to the place of this small assessee, then challan for movement of goods from one premises of taxpayer to another godown of taxpayer along with e-way bill will be issued. The recipient taxpayer is also required to maintain records as per rules 56 and 57 of the CGST Rules at this godown also. However, the transporter is not required to follow any additional compliance requirements apart from those prescribed. But the problem comes when a number of such small traders have declared this premises as additional place of business. All these have to maintain records at same place. This does not seem to be feasible.
It is clarified in this circular that the above provisions would apply mutatis mutandis in the case where the supplier of the goods and the transporter are located within the same state.
 
 
But we have come across another situation like this only. In such situation, prior to introduction of GST, the factory owner used to send the unsold material to various locations in other states. This unsold material was kept with transporter. The agent of factory is told about same. Whenever the material was sold, the delivery was taken from transporter and handed over to purchaser. The bill was raised by factory owner afterwards.
This situation does not fit into the same. As the additional place of business can be added in the same state, but it is normally outside the state.  Hence, a separate registration is to be taken and this will act as depot of factory.
 As per Section 25 of CGST Act, 2017 which reads as follows:
(2) A person seeking registration under this Act shall be granted a single registration in a State or Union territory: Provided that a person having multiple business verticals in a State or Union territory may be granted a separate registration for each business vertical, subject to such conditions as may be prescribed.
Thus, on the basis of the interpretation of the above provision it can be concluded that the supplier is required to obtain a separate registration in a state for every state that he wishes to declare as an additional place of business. However, it is impracticable for the supplier to obtain separate registration for each and every state where the warehouse of the transporter of goods is located.
But taking registration of transporter godown is big task as ownership document or rent deed agreement is required.  Moreover, a number of factory owners used to keep their material with the same transporter but it is not feasible to take registration of same premises by number of persons. Hence, this practice has stopped and factory owner supplies the goods to specific clients only.
The government required to consider the cases where the unsold goods are kept by the supplier at the transporter’s godown in other state for further sale. It would be difficult for the supplier to abide by the compliance requirements of the law as this would lead to a substantial increase in the compliance costs.
Hence, the government is required to issue further clarifications on these matters.
 
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