Central Goods and Services Tax (Third Amendment) Rules, 2019

CBIC has notified Central Goods and Services Tax (Third Amendment) Rules, 2019 on 23rd April, 2019. This amendment has been brought to bring uniformity between those paying tax under composition levy scheme as provided in Section 10, CGST Act and those eligible to pay tax within the ambit of the March 7 notification.

In a previous post, we had shared that persons registered under the Central Goods & Services Tax Act, 2017 (“CGST Act”), subject to prescribed criteria including annual turnover not exceeding INR 50 lacs, have the option to pay tax at the rate of 3% on the first supply of goods or services as per notification dated 7th March, 2019. Persons paying tax under composition levy scheme as provided in Section 10 were also brought within the scope of discounted rate by the notification dated 29th March, 2019.

Below are the key amendments to the CGSG Rules so as to allow an atmosphere conducive to the intended parity in procedure for the said two categories of tax payers:

1. A new FORM GST CMP-08 has been inserted in the CGST Rules whereby tax payers are to furnish statement of self-assessed tax. Tax payers shall furnish this statement on a quarterly basis and no later than the 18^th day of the month succeeding a respective quarter.
2. Further, tax payers shall furnish a return for every financial year in FORM GSTR-4 no later than the 30^th day of April after the end of such financial year.
3. FORM GST CMP-08 shall also be used to furnish details of withdrawing from the composition scheme. This shall pertain to the period for which tax has been paid till the 18^th day of the month succeeding the quarter in which the withdrawal is opted for. This shall be reflected in to above referred FORM GSTR-4 within the same timeline until April 30 of the respective financial year.
4. Interest shall be leviable in the event of delay in filing the said forms.
5. FORM GST CMP-08 must also take into account any adjustments due to advance credit or debit notes along with any necessary rectifications. As a result of these adjustments, in case a negative value is ascertained, the same must be reported as is and is required to be carried forward to the next quarter.
6. In case of a nil tax liability, the same must be submitted clearly.
7. Tax payers must indicate appropriately in FORM GST REG-01 the option of payment of tax being exercised by them.
8. Such tax payers shall not be eligible to avail input tax credit as regards the period prior to opting to pay tax under either mechanism.
9. Tax payers availing benefit of the March 7 notification shall, with respect to the period in which the benefit is availed, shall be deemed to have furnished details of outward supplies and furnished returns.
10. These amended provisions shall come into effect on June 21, 2019.

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