Background: The circular issued by the Central Board of Indirect Taxes and Customs (CBIC) on 23 April 2019 now allows businesses to apply for revocation of cancellation of GST registration forms by 22 July 2019. This move has been implemented for businesses who continue operating even after their registration is cancelled. Earlier, instead of applying for revocation, they applied for a fresh registration. This way they could escape paying taxes that were due from the earlier registration. The move by CBIC allows companies, for whom the cancellation order has been passed up to 31 March 2019, a one-time opportunity to revoke the cancellation of their GST registration. Founder of 8 Square Advisors, Vikash Khannah explains further.

Application for revocation of cancellation of GST registration

The GST Act now allows businesses to revoke the cancellation of GST registration for non-filing of GSTR-3B, or Form GSTR-4 as applicable, via section 29 (2) of the GST Act 2017.

In case the assessee wants to appeal against the cancellation order so passed , he may do so within a period of 30 days as stipulated under section 30 (1) of the Act. However, several assessees expressed their concern to the board saying they couldn’t apply for revocation within the stipulated period.

The CBIC and the GST policy wing considering the difficulties faced by the assessees issued a Removal of Difficulty order (RoD) number 05/2019-Central Tax dated 23 April 2019 providing an one-time opportunity to apply for revocation of cancellation of registration on or before the 22 July 2019.

Assessees are encouraged to make use of this last opportunity in case they want to restore their cancelled registrations. The relevant notification can be accessed at the CBIC site.

Utilisation of Input Tax Credit under GST

Section 49 was amended and Section 49A and Section 49B were inserted vide Central Goods and Services Tax (CGST) Amendment Act, 2018. The amended provisions came into effect from 1 February 2019.

As a result of the changes brought about by the amended provisions, representations were made by various trade and industry bodies regarding challenges being faced by taxpayers. The issue has arisen on account of order of utilisation of Input Tax Credit of Integrated tax in a particular order, resulting in accumulation of Input Tax Credit for one kind of tax (say State tax) in electronic credit ledger and discharge of liability for the other kind of tax (say Central tax) through electronic cash ledger in certain scenarios.

Taking into consideration the numerous representation as well as the difficulties faced, rule 88A has been inserted in the CGST Rules allowing utilisation of Input Tax Credit of Integrated tax towards the payment of Central tax and State tax, or as the case may be, Union territory tax, in any order subject to the condition that the entire Input Tax Credit on account of Integrated tax is completely exhausted first before the Input Tax Credit on account of Central tax or State / Union territory tax can be utilised. The relevant notification can be accessed at CBIC site.

Income Tax

The Central Board of Direct Taxation (CBDT) vide notification no 41/2019 dated 22 May 2019 has inserted  the Income-tax Rules, 1962, in Appendix II, in Form No. 15H in Part II, in note 10, provision which casts an obligation upon the person responsible to deduct TDS to accept 15 H declaration even in a situation where the income of the assessee is higher than the income stipulated therein subject to the condition that the tax liability shall be ‘Nil’ after taking into consideration the rebate of income tax available under section 87A. The relevant notification can be accessed at CBDT site.

Interested in reading more articles on GST? Check out our other articles here:

GST Council announces tax cuts in real estate

All about GSTR-3B return filing

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