GST Council adopts report of GoM on GST Tribunal and recommends various trade facilitation measures

This Tax Alert summarizes the recent press release issued by the Ministry of Finance on various recommendations made by the Goods and Services Tax (GST) Council in its 49th meeting held on 18 February 2023.

The key recommendations are as follows:

• Adoption of report of Group of Ministers (GoM) on GST Appellate Tribunal (GSTAT) with certain modifications.
  
• Taxable services provided by courts and tribunals is proposed to be covered under reverse charge mechanism (RCM).
  
• Extension in time limit to apply for revocation of cancellation of registration and filing of relevant return pursuant to best judgement assessment order. One time amnesty scheme has also been proposed for past cases.
  
• Rationalization of late fees in case of delayed filings of GSTR-9 from financial year 2022-23 onwards.
  
• Amnesty scheme in respect of pending returns in GSTR-4, GSTR-9 and GSTR-10 by way of conditional waiver/ reduction of late fee.
  
• Place of supply of services of transportation of goods (other than by way of mail or courier), in cases where location of either the supplier or the recipient is outside India, shall be location of the recipient.
  

Comments

• Ensuring expeditious setting up of GSTAT may aid in clearing the piled-up litigations and also reduce the workload of writ courts.
  
• Services provided by courts and tribunals under any law is outside the purview of GST. The proposed services to be covered under RCM appears to be such services which are not required to be provided by courts or tribunals under any law.
  
• Legal services provided by advocates to business entities is covered under RCM. Hence, many lawyers and law firms have not opted for GST registration. If the services provided by courts and tribunals by way of renting of chamber to lawyers is covered under RCM, GST registration requirement in such cases may have to be evaluated.
  
• Various trade facilitation measures like extension of time limit to apply for revocation of registration and filing of relevant return pursuant to best judgement assessment order, rationalization of late fee for filing GSTR-9 and various amnesties provided are likely to benefit the businesses.
  
• Vide Finance Bill, 2023, amendment was proposed in Section 12(8) of the IGST Act which provides for place of supply of transportation of goods where the supplier as well as the recipient are located in India. The proposed deletion of Section 13(9) appears to be on similar lines.