Government notifies effective date for amendments made in GST law vide Finance (No.2) Act 2024

This Tax Alert summarizes recent Notification^[1] issued by Central Board of Indirect Taxes and Customs (CBIC) notifying effective date for the amendments made in Central Goods and Services Tax Act, 2017 (CGST Act) and allied laws vide Finance (No.2) Act, 2024.

The Amendments effective from 1 July 2017:

• Time limit to avail ITC for FY 2017-18 till 2020-21 extended till 30 November 2021.
  
• ITC on any services received prior to 1 July 2017 by an ISD shall be eligible for distribution as GST credit, even if invoices are received prior to the said date.
  

Amendment effective from 27 September 2024:

• Functions of Appellate Tribunal expanded to include examination or adjudication of anti-profiteering cases.
  

Amendments made effective from 1 November 2024:

• Amnesty scheme to provide waiver of interest and penalty for pending demands in non-fraud cases for FY 2017-18 till 2019-20, if entire tax demand is paid up to the date to be notified.
  
• Government to be empowered regarding non-recovery of duties not levied or short-levied as a result of general prevalent trade practice.
  
• Common timeline to apply for issuance of SCNs and orders in both fraud and non-fraud cases from FY 2024-25 onwards. 
  

Comments

• GST Council in its 54th meeting have recommended 31 March 2025 as the date on or before which the payment of tax would be required to be made to avail the benefit of Section 128A. Rule 164 will be inserted in the CGST Rules along with certain Forms for providing procedure and conditions for taking benefit of amnesty scheme. A Circular was also proposed to be issued in this regard.
  
• Council had also recommended issuance of special procedure for rectification of orders under Section 148. This is for taxpayers who received orders under Section 73, 74, 107 or 108 for wrongful availment of ITC beyond the time limit prescribed under Section 16(4), but now permissible as per Section 16(5) and 16(6).
  
• Exclusion of un-denatured ENA from GST is prospective and hence, the dispute remains unsettled for the past cases where many taxpayers have not paid tax on sale of ENA. Further, businesses may have to evaluate its taxability under the State Excise and VAT laws.
  
• Vide Circular No. 224/18/2024 - GST, CBIC clarified that till the time GSTAT commences operations, recovery of amount of confirmed demand as per the Appellate Authority’s order will be stayed on payment of an amount equal to pre-deposit and filing of an undertaking. Post 1 November 2024, taxpayers may compute the above amount as per the revised pre-deposit requirements.
  
• Currently, Rule 47 of CGST Rules provides that the invoice referred to in Rule 46 shall be issued within a period of thirty days from the date of supply of service. Self-invoice is also covered within the ambit of Rule 46. It remains to be seen whether the timelines to be prescribed by the Government for issuance of self-invoice would be in line with Rule 47.

[1] Notification No. 17/2024 - Central Tax dated 27 September 2024 and Notification Nos. 18 and 19/2024 – Central Tax dated 30 September 2024