Knowledge Sharing Session on GST

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rsm.global/india Strictly Confidential

13th October, 2018

Contents

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• Recent updates in Act, Rules and Procedural Aspects

• Recent court/Advance Ruling judgments

• Important aspects related to GST Annual Return, Reconciliation and Audit

• Sharing key audit/review findings

• Addressing general queries of the participants

LATEST UPDATES IN ACT, RULES, PROCEDURES & IMPORTANT JUDGMENTS

Important GST Updates

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Notified “Part A- FORM GSTR- 9C - Reconciliation Statement and Part B- Auditor‟s

Certificate” [Notification No. 49 /2018 –CT dated 13th September, 2018]

w.e.f 1st Oct, 2018, notified persons (i.e. dept. of central/state government, local

authority, governmental agencies) are required to deduct TDS @ 2% for total value of

supply exceeding Rs. 2.5 Lacs and the amount so collected shall be paid to the

Government by the deductor within 10 days after the end of month [Notification No. 50

/2018 –CT dated 13th September, 2018]

w.e.f 1st Oct, 2018, e-commerce operators are required to deduct TCS @1% of net

value of taxable supply and the amount so collected shall be paid to the Government by

the e-commerce operator within 10 days after the end of the month [Notification

No.51/2018 –CT dated 13th September, 2018]

Important GST Updates

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New sub- rule (1A) has been inserted in Rule 117 empowering the Commissioner to

extend the date of submission of FORM GST TRAN-1 by a further period not beyond

31st March, 2019 for those who could not submit earlier on due date and submit the

statement in FORM GST TRAN-2 by 30th April, 2019 on the recommendations of the

Council [Notification No. 48 /2018 –CT dated 10th September, 2018]

Those taxpayers who are required to store the goods in godown/ warehouse of the

transporter can declare the place of transporter‟s godown as additional place of busines

and there is no need to extend the validity of e-way bill. [Circular No. 61/35/2018-GST

dated 4th September, 2018]

It has been clarified that taxpayers may reverse the wrongly availed CENVAT credit

under the existing law and in-admissible transitional credit through GSTR 3B along with

applicable interest & penalty [Circular No. 58/32/2018]

Important GST Updates – Revised Due Date for Return filling

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Monthly GSTR 1 (turnover more than 1.5 cr.)

Quarterly GSTR 1 (turnover up to 1.5 cr.)

Due date for furnishing declaration in Form GST ITC-04 in respect of goods dispatched to a job worker

or received from a job worker or sent from one job worker to another, during the period July 2017 to

June 2018 has been extended to 30th Sept. [Notification No.40/2018 dated 4-9-2018]

Tax Period Revised Due Date

July 2017 to Sept. 2018 31st October, 2018

October 2018 to March 2019 11th day of succeeding month

Tax Period Revised Due Date

July 2017 to Sept. 2018 31st October, 2018

October 2018 to December 2018 31st January, 2019

January 2019 to March 2019 30th April 2019

Important GST Updates – Revised Due Date for Return filling

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Revised due dates prescribed for migrating taxpayers, who have received provisional ID but could not

complete the migration process, to complete the GST registration

GSTR 1 (T/o above 1.5 cr.) Revised Due Date

July 2017 to Nov. 2018 31st December, 2018

Dec. 2018 to March 2019 11th day of succeeding month

GSTR 1 (T/o up to 1.5 cr.) Revised Due Date

July 2017 to Sept. 2018 31st December, 2018

October 2018 to December 2018 31st January, 2019

January 2019 to March 2019 30th April 2019

GSTR 3B Revised Due Date

July 2017 to Nov. 2018 31st December, 2018

Dec. 2018 to March 2019 20th day of succeeding month

Important GST Updates – Clarifications on refund related issues

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For refund claim, submission of GSTR-2A for the relevant period will be sufficient

evidence. However where GSTR 2A does not contain any particular details of invoices,

the proper officer may call for the hard copies of such invoices.

After claiming of refund, the claimant have to debit the refund amount claimed in the

electronic ledger in the below given order-

a. IGST, to the extent of balance available;

b. CGST and SGST/UGST, equally to the extent of balance available.

In case of rejection of claim for refund of unutilized ITC on account of any reason other

than non-eligible ITC, the rejected amount shall be re-credited to the electronic credit

ledger using FORM GST RFD-01B only after the receipt of an undertaking from the

claimant to the effect that he shall not file an appeal against the said rejection.

Important GST Updates – Clarifications on refund related issues (cont.)

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Whereas in case of rejection of claim for refund of unutilized input tax credit on

account of non-eligible ITC, the proper officer shall order for the rejected amount to be

re-credited to the electronic credit ledger of the claimant and simultaneously issue a

demand notice for the said amount along with interest and penalty, if any.

Registered persons, including importers, who are directly purchasing/importing supplies

on which the benefit of reduced tax incidence or no tax incidence under certain specified

notifications has already been availed, shall not be eligible for refund of IGST paid on

export of goods or services.

The limit of Rs.1000 shall be applied for each tax head separately and not cumulatively.

The limit would not apply in cases of refund of excess balance in the electronic cash

ledger.

[Circular No. 59/33/2018-GST dated 4th September, 2018]

Important GST Updates

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Recipient shall be eligible for ITC even though all particulars are not

present in tax invoice provided invoice contains at least following:

[Insertion in Rule 36]

a. Amount of tax charged

b. Description of goods or services

c. Total value of supply of goods or services or both

d. GSTIN of supplier and recipient

e. Place of supply in case of inter-state supply

In case of imported goods, the person in-charge of a conveyance shall

also carry a copy of the bill of entry filed by the importer and shall

indicate the number and date of BOE in Part A of FORM GST EWB-01

[New proviso in sub- rule (1) of Rule 138A]

New mechanism of return filling has been proposed so as to reduce no.

of returns as well as ensure smooth flow of credit

Important GST Updates

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All importers who are procuring imported goods under advance Authorisation and

EPCG without payment of IGST, cannot pay IGST on the resultant export goods and

claim refund of the same. In such case, exporter must compulsorily export under LUT

and claim refund of the accumulated ITC. This amendment is applied retrospectively

w.e.f. 23rd October, 2017.

The persons who did not file the complete FORM GST REG 26 but received only a

Provisional Identification Number (PID) till the 31st December, 2017 may now apply for

GSTIN. [Notification No.31/2018- CT dated 6th August, 2018]

It has been clarified that the services of religious and charitable trusts by way of

residential programmes or camps meant for advancement of religion, spirituality or

yoga shall be exempt. However, if charitable or religious trusts provide accommodation

or serve food and drinks against consideration in any form including donation, then

such activities will be taxable [Circular No 66/40/2018 GST dated 26th sept. 2018]

Important GST Updates – GSTN Portal

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Facility to file refund application for multiple tax period has been enabled on portal

It is now possible to insert Shipping Bill date prior to date of invoice on GSTN portal to

facilitate smooth processing of refund in case of consignment export

Facility to claim refund against excess payment made in specific pool has been enabled

w.e.f. 16th April, 2018, there have been a change in GST refund checkpoint at GST

portal, wherein the flexibility of claiming inter-pool refund was enabled. Formal circular

has been issued confirming the same [Circular no. 59/32/2018-GST]

For GST ITC 04, a field for “Losses & Wastes” has been added in the form so as to have

check on qty. issued and received. Multiple entries for single challan will be possible now.

Certain fields added in E-way bill portal [Transporter ID made compulsory for generating

Part-A slip]

Important GST Updates – E Way Bill

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Gujarat E-way Bill Rules changed w.e.f 01.10.2018 vide notification dated 19th sept. 2018

Notification No. GSL/GST/RULE-138(14)/B.19. Provisions have been summarized below

Important GST Updates – Amendment to CGST Act, 2017

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Transitional provisions have been suitability amended, with retrospective effect, to restrict

the meaning of “CENVAT” only to extent of “eligible du-ties”. This amendment will make

the KKC and Education Cess as ineligible duty to be carried forward under GST regime.

Upper limit of turnover for opting for composition scheme to be raised from Rs. 1 crore to

Rs. 1.5 crore.

Composition dealers to be allowed to supply services (other than restaurant services), for

upto a value not exceeding 10% of turnover in the preceding financial year or Rs. 5

lakhs, whichever is higher

Taxpayers may opt for multiple registrations within a State/ Union territory in respect of

multiple places of business located within the same State/Union territory.

Registration to remain temporarily suspended while cancellation of registration is under

process, so that the taxpayer is relieved of continued compliance under the law.

Registered persons may issue consolidated credit/debit notes in respect of multiple

invoices issued in a Financial Year.

Supply of services to qualify as exports, even if payment is received in Indian Rupees,

where permitted by the RBI.

Important GST Updates – Amendment to CGST Act, 2017

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In case the recipient fails to pay the due amount to the supplier within 180 days from the date

of issue of invoice, the input tax credit availed by the recipient will be reversed but there will be

no interest liability

No GST shall be applicable on any treatment or process done on goods temporarily imported

into India which are then exported out of India.

Existing cross utilisation model:

- Output IGST >> Input IGST, Input CGST, Input SGST

- Output CGST >> Input CGST, Input IGST

- Output SGST>> Input SGST, Input IGST

Proposed amendment:

- Output IGST>>Input IGST, Input CGST, Input SGST

- Output CGST>> Input IGST, Input CGST

- Output SGST>> Input IGST, Input SGST

In proposed amendment, one has to set off IGST balance first against each pool, then only CGST

and SGST can be utilised. The consequences of which is there will always be unutilised ITC

balance in CGST pool, but have to make higher payment in SGST pool

Important GST Updates – Internal auditor can not certify GST Audit

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The Council of the Institute, while considering the issue at its 378th

Meeting held on 26th and 27th September, 2018, noted its earlier

decision taken at that internal auditor of an assesee,

whether working with the organization or

independently practicing Chartered Accountant being an

individual chartered accountant or a firm of chartered

accountants, cannot be appointed as his Tax auditor (under the

Income Tax Act, 1961). Upon consideration, the Council has

decided that based on the conflict in roles as statutory and internal

auditor simultaneously, the bar on internal auditor of an entity to

accept tax audit (under Income Tax Act, 1961) will also be

applicable to GST Audit (under the Central Goods and Service

Act, 2017). Accordingly, it is clarified that an Internal Auditor of an

entity cannot undertake GST Audit of the same entity.

Important Pronouncements/ Judgements

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Gujarat High Court on 18/09/2018 grants interim stay on the retrospective amendment in case

of inverted duty refunds whereby refund on input services was denied by notification dated

13-06-2018 w.e.f. 01-07-2017.

Authority of Advance Ruling (AAR) of Karnataka held in case Columbia Asia Hospital that

activities performed by the employees at the corporate office in the course of or in

relation to employment such as accounting, other administrative and IT system

maintenance for the units located in other states as well i.e. distinct person as per

section 25(4) of the CGST Act, 2017 shall be treated as supply as per Entry 2 to Schedule I

of th CGST Act

Madras High Court recently held that due dates to claim Transitional Credit is Procedural in

Nature, Input Credits can‟t be denied on Procedural Grounds

Gujarat HC strikes down clause (iv) of S. 140(3) of the CGST Act prescribing „ one year‟ validity

period for the invoices in case of the dealers for the purpose of transitional credit.

GST ANNUAL RETURN IN FORM GSTR-9

Annual Return

• Every registered person is required to file Annual Return in form GSTR 9 on or before 31st December.

• Irrespective of turnover, a separate GSTR 9 is to be filed for each GSTIN.

• Reconciliation of amount of outward supplies and inward supplies with the figures reported in GSTR 1 & 3B

need to be given.

• Details of outward supplies and ITC availed for the relevant FY after the end of such FY need to be reported

separately.

• It is pertinent to note that any ITC for relevant FY can be availed latest by filing GST return for the month of

September of succeeding FY.

• Any ITC not availed till such period will be lapsed.

• Any outward supply, which is not reported till September of succeeding FY can only be reported in Annual

Return and the tax thereon need to be paid through cash ledger only.

• Any amendment required in outward supplies can also be made till filing of GSTR 1 for the month of September

of succeeding FY only.

GSTR 1 & 3B - September 2018 – Important Points

GSTR 1:

• GSTIN of supplies reported in B2B need to be checked;

• Shipping Bill and invoice details reported in export table need to be confirmed with ICEGATE. In case of any mismatch

therein, there will be a significant impact on GST refund;

• In case of B2C supplies, check whether Place of supply has been determined properly. If not, the entity needs to rectify it

year-on-year basis in GSTR 1 and give adjustment effect thereof in GSTR 3B.

If IGST has been paid erroneously instead of CGST & SGST, pay correct amount of CGST & SGST WITHOUT

interest and claim refund of IGST;

If CGST & SGST has been paid erroneously instead of IGST, pay correct amount of IGST WITH interest and claim

refund of CGST & SGST.

GSTR 3B:

• Reconcile the pool-wise tax liability reported in GSTR 3B with GSTR 1 and books. Adjust all the differences with interest.

• Reconcile all the ITC with books of accounts as well as GSTR 2A and avail / reverse differential ITC.

Major Heads in GSTR-9

• Details of outward supplies, advance and inward supplies on which tax is payable as declared in returns;

• Details of outward supplies on which tax is NOT payable as declared in returns;

• Details of ITC availed as declared in returns;

• Details of ITC reversed and ineligible ITC as declared in returns;

• Comparison of ITC availed with auto populated GSTR 2A;

• Details of tax payable and paid through ITC and cash;

• Details of outward supplies and ITC reported after the end of FY, but up to filing of September return of

succeeding FY

• Details of demand and refund;

• Details of supplies received from composition dealer, deemed supply u/s 143 and goods sent on approval basis;

• HSN wise summary of outward supplies;

• HSN wise summary of inward supplies.

RCM u/s. 9(3), 9(4)

Effect of amendment to

be reported separately

Why exclusion of

supplies from SEZ???

Which are those

instances???

Other Details

• Details of transactions reported after the end of FY, but up to filing of September return of succeeding FY

Supplies declared / reduced through amendments;

ITC availed / reversed;

Differential tax paid on account of point no. 1 above.

• Details of refund claimed, sanctioned, rejected and pending;

• Details of tax demand raised, demand paid and demand pending.

• Inward supplies received from composition dealer;

• Deemed supply u/s 143;

• Goods sent on approval basis but not returned within 180 days.

• HSN wise summary of outward supplies;

• HSN wise summary of inward supplies.

GST AUDIT REPORT AND RECONCILIATION STATEMENT IN GSTR 9C

Audit Under GST

• Every registered person whose Aggregate Turnover during a financial year exceeds Rs. 2 Crore is

required to get his accounts audited by a practicing chartered accountant or a cost accountant

• Aggregate Turnover – Section 2(6) of the CGST Act, 2017

It is to be counted on PAN basis;

It also includes the branch transfer made to the person having same PAN.;

• Every registered person who is required to get his accounts audited in accordance with the provisions of

sub-section (5) of section 35 shall furnish, electronically, the annual return under sub-section (1) along

with a copy of the audited annual accounts and a reconciliation statement

CONT…

• For effective facilitation of audit, Every Registered person shall keep and maintain

books of accounts to show true and correct value in regards to:

1. Production or manufacture of goods

2. Inward supply of goods or services or both

3. Outward supply of goods or services

4. Inventory of input goods, semi-finished goods and finished goods

5. Input tax credit availed in applicable Financial Year.

6. Output tax paid in the Financial year

Which are those

instances???

Separate details required

to be maintained in ERP

Any Example….

GSTR – 9C

Auditor’s recommendation on additional liability due to non-reconciliation, which inter alia includes:

• Supplies reported into incorrect rate of GST which results into additional liability;

• ITC erroneously availed;

• Any interest payable but not paid;

• Amount paid for supplies not included in GSTR 9;

• Refund erroneously claimed;

• Demands outstanding to be settled

ERP/IT System Preparedness

ERP system should be capable to capture following details:

• GST rate applicable and GST amount with break-up of (CGST, IGST and SGST/UGST);

• HSN/SAC code as applicable to nature of supply;

• whether GST subject to RCM or not;

• supply from registered/un-registered or composite dealer;

• supply from SEZ or otherwise;

• ITC on goods, service or capital goods;

• Eligible to claim ITC or ineligible (in case of ineligible ITC, the expense should be booked Net of GST and the

amount of GST should be booked in Profit & Loss A/C under “Ineligible ITC - CGST”, “Ineligible ITC - SGST”

and “Ineligible ITC - IGST”);

• In case of import of service, the ERP system should be able to record different value as per books (i.e. based on

the RBI rate prevailing on the invoice date) and taxable value as per GST rules (i.e. RBI rate prevailing on the

date of payment or 60th day from the date of invoice, whichever is earlier);

ERP/IT System Preparedness

All outward supplies to be classified as below:

• Rate wise Taxable supply;

• Rate wise Zero rated without/with payment of tax;

• Rate wise Supply to SEZ without/with payment of tax;

• Exempted supply (e.g. edible vegetables, cereals etc. which attracts 0% GST);

• Nil rated supply (Presently there are no NIL rated supplies in GST.);

• Non-GST supply (e.g. petrol/diesel, electricity etc.)

Other Points:

• ERP should be capable to provide reference of original invoice no. and date for each debit/credit note issued

• MIS showing GST rate wise outward and inward supplies

• MIS showing expense head wise bill amount, GST amount, eligible ITC amount and not-eligible ITC amount

Points for consideration while finalizing Accounts:

• Accumulated ITC for which refund application has not been filled by the entity;

• Provision for GST payable and ITC receivable as on 31.03.2018 [for which GSTR 3B will be filed on or before 20.04.2018];

• Figures reported in GST returns need to be reconciled with the books of accounts;

• Necessary adjustment in books based on reco of outward supplies, inward supplies and ITC

• If there are inward supplies on which ITC has not been availed in GST returns, a separate account namely “ITC due but not

claimed” can be created.

• Similarly, if there are outward supplies on which tax has not been offered in GST returns, a separate ledger namely

“Provision for GST not paid” can be created.

• In case of import consignment for which Customs and GST has been paid but the same is lying with customs department as

on 31.03.2018, it will form part of inventory value in the books of accounts as “Stock in Transit”. However, it will not be part

of stock qty. report

• In case of consignment export, for which no confirmation has been received as on 31.03.2018, the same will also form part

of inventory value in the books of accounts as “Stock in Transit”. However, it will not form part of stock quantity report.

Points for consideration while finalizing Accounts (Cont.)

• Reconciliation of Turnover as per books and outward supplies as per GST returns.

Amount not forming part of turnover as per books as per GAAP [e.g. rental income, interest income,

other indirect incomes]

Amount not forming part of turnover in GST [e.g. Electricity sale]

Difference in forex conversion rate as per books and GST returns [e.g. RBI rate in books and CBIC rate

in GST]

Sale of capital goods

Advances received on which GST has been paid

• In the same manner, the reconciliation of inward supplies is to be prepared

• Transaction classified as composite supply and mixed supply;

• Details of supplies on which recipient was liable to pay tax under RCM, but supplier has paid tax instead of

recipient.

• Details of export proceeds not realised in FCC within 1 year from the date of issue of invoice;

Points for consideration while finalizing Accounts (Cont.)

• Whether any goods have been detailed / seized / confiscated during the year as per section 129 & 130.

If yes, whether the tax, interest, penalty liability has been discharged?

• Whether payment has been made within 180 days on the supplies on which ITC has been availed?

• Working of refund for which the entity was eligible and the refund actually claimed.

GST – Key Audit Observations

rsm.global/india Strictly Confidential

Key Area of Observations

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Documentation

Registration

ITC

Accounts

Returns

Refund

Documentation - Delivery Challan

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Not mentioning of Rule reference on the face of challan - [Rule 55 of CGST Rules, 2017]

Not mentioning/ mentioning old E-way bill exemption notification on Challan applicable to

Gems and Jewellery Industry - [No E-way bill is required to be generated as the goods

covered under this invoice/challan are exempted as per serial number 4/5 of Annexure to

rule 138(14) of the CGST rules 2017]

Purpose of movement of goods not specified – [Transfer of goods for reasons other than

by way of supply : „Job-work‟, „Job-work return‟, „Sale on approval‟ etc.]

Place of supply not mentioned in case of inter-state movement of goods – [Rule 55 of

CGST Rules mandates Place of supply in case of inter state movement]

Documentation - Delivery Challan (Cont.)

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Tax rate and amount i.e. IGST, CGST – SGST mentioned in case of transportation of

goods which is not supply – Tax rate and Tax amount is mandatory where the

transportation is for supply]

Challan is issued manually which lead to non-maintaining serially numbered challan and

old challan is destroyed whenever transaction is completed – [Fraudulent records

maintenance lead to levy of Tax, Interest and Penalty]

Not obtained challan issued by counter party on return of goods – [Delivery challan of

counter to be obtained on return of goods to support inventory In-Out records]

Non issue of delivery challan (and invoice) for goods sent for specific purpose like

Assortment, Grading, Repairing etc.

Documentation - Invoice

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Non mentioning of Section and Rule on the face of challan under which the same has

been issued - [Section 31 of CGST Act, 2017 and Rule 46 of CGST Rules, 2017]

Non-mentioning or mentioning of old E-way bill exemption notification on Tax Invoice

applicable to Gems and Jewellery Industry - [No E-way bill is required to be generated as

the goods covered under this invoice/challan are exempted as per serial number 4/5 of

Annexure to rule 138(14) of the CGST rules 2017]

Export Invoice without mentioning nature of transaction i.e. Export with payment of IGST

or Export without payment of IGST – [Refund in respect of Export is dependent on type of

export]

Debit Note is used for Other Income like Rent Income, Brokerage Income etc. - [Tax

Invoice has to be issued for such income. Debit Note is raised in case of rate difference,

quantity difference in respect of transaction linked to core supply]

Documentation - Invoice (cont.)

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Place of supply is not mentioned in case of inter state supply – [Rule

46 of CGST Rules, 2017]

Maintaining of Invoice series on monthly basis like APR/01 – APR/10,

MAY/01 – MAY/10 – [Invoice series has to be serially number through

out the financial year]

Invoice used to be issued from place of business which is not

registered under the GST registration certificate – [Place has to be

registered on GST Portal from where invoice is going to issue / books

of accounts are maintained]

Non mentioning of LUT number in case of export made without

payment IGST

Documentation :

46

Receipt Voucher, Refund Voucher, Self-Invoice, Payment

Voucher

Receipt Voucher for receipt of taxable supply;

Refund voucher for refund of refund of advance receipt;

Self-invoice and Payment voucher against receipt of

inward supply from URD liable to GST under RCM;

are not maintained as per requirement of CGST Rules,

2017

Registration:

47

Premises added as Principal / Additional place of business is not correct as per

registration documents of such premises – [Any defect in registration profile may lead to

penalty]

Additional place of business in following cases –

Premises where books of accounts are maintained;

Premises of Job-worker from where supply is made;

Premises from where goods are supplied;

has not been added / modified from time to time in registration profile.

Registration profile is still showing contact details of person who is no longer in the

organisation and submission details are being forwarded on such contact details

Records pertaining to GST are signed by person who is not an authorised person under

GST registration profile

HSN / SAC code uploaded on GST portal is not correct in relation to nature of business of

the organisation

Registration: (Cont.)

48

Registration profile is showing incorrect Company

Identification Number (CIN) by omitting 1 digit from correct

number

Bank accounts details uploaded on GST portal has not

been updated by adding / deleting old account details

Introduction or resign of Partners / Directors is not

updated on real time basis

Registration not obtained on e-way bill portal since capital

goods/ consumables etc. may not be fully exempt under

e-way bill

ITC :

49

In-eligible input tax credit as specified under section 17(5) is

availed and utilized against outward tax liability

ITC of capital goods is not reduced from Net input tax credit for

the purpose of refund calculation in respect of export under LUT

ITC related to personal nature expenditure has been availed

and utilized

Tax invoice in respect of inward supply is not carrying GSTN,

Name and address of the receiving party

Claiming ITC in respect of immovable property by considering it

as revenue nature

Non-reversal of ITC related to such inward supply for which

payment has not been made within 180 days

ITC : (Cont.)

50

Claiming ITC in respect of supply which should not be incurred by

such registered person

Non reversal of ITC in proportion of exempted / Non-GST outward

supply to total outward supply

Claiming of ITC pertaining to exempted / Non-GST outward supply

i.e. Renewable electricity supply

Tax invoice number in respect of inward supply exceeds 16 digits

ITC is being claimed on the basis of Performa invoice

Payment not made within 180 days for the taxable supply received

from branch/HO/units having separate GST number

Accounts:

51

Consolidate books of accounts maintained for multiple GSTN falling under same PAN

One single account maintained for posting of entries in respect of outward tax liability and

inward input tax credit

RCM tax liability and tax credit claim has not been separated in books of accounts

Separate accounts with regard to in-eligible ITC is not maintained

ITC set-off entries are not done on monthly basis immediately on filing of GSTR-3B of

respective month

Mismatch between electronic ledger i.e. Cash and Credit on GSTN portal and books of

accounts

Back dated entries for outward taxable supply and inward input tax credit are allowed

even after filing of GSTR-3B for respective month

Export booked at rate other than Custom Notified rate being issued by CBIC

Accounts: (cont.)

52

Accounting entries of income and expenses are entered into through JV

Consignment export booked as confirmed exports in books of accounts

GSTN of supplier party is getting updated from retrospective effect in the books of

accounts

Operating single bank account for multiple GSTN and taking ITC on one GSTN

Taxable turnover is showing as including of tax amount in the books of accounts

Mismatch between inter-unit inward – outward supply and tax amount

Branch and HO standalone books not showing correct profit/loss figure in line with

consolidated accounts due to excess/under billing of supplies between branch and HO

Inability to ascertain goods with job worker (ageing wise) from the date of issue through

ERP system to have check whether it is returned (including rejection) after processing

Requisite ledger accounts not opened in books of accounts to generate figures for

reporting in GST returns

Returns:

53

Reporting of Zero rate supply / SEZ supply in Outward taxable supply in GSTR-3B

Reporting of SEZ supply under Table 6A – Export Invoices instead of Table 4 - B2B

Invoices

Non-reporting of advance receipt which is liable to tax under GST

Non-reporting/issue of Credit/Debit Note for reducing/increasing tax liability in respect of

outward taxable supply

Credit/ Debit note issued to registered/unregistered person is not linked with Original Tax

Invoice

Reporting of inter-state transaction as intra-state transaction in GSTR-3B and B2C section

of GSTR-1 and vice-versa

Non-reporting of Non-GST outward supply and claiming of ITC related to such Non-GST

outward supply

Non-filing of ITC-04 in respect of outward-inward of goods for job-work purpose on

quarterly basis

Returns: (cont.)

54

Mismatch between outward supply reported under various tables of GSTR-1 and HSN-

wise summary of outward supplies of GSTR-1

Non-reporting of details of delivery challan, self-invoice, receipt voucher, payment

voucher, refund voucher, tax invoice in Documents Issued table of GSTR-1

Reporting of invoice/challan/voucher series which is not in continuous as reported in

previous return

Mismatch in outward tax liability between GSTR-3B and GSTR-1 of respective month

Reporting of Consignment exports as regular exports under Table 6A – Export invoices

and issuing Credit Note for part which is not sold out

Refund:

55

Consignment exports are considered as regular export for the purpose of refund claim

Refund claim is not being reduced to the extent of ineligible ITC and capital goods ITC

Non submission of reply against the deficiency memo (Form GST RFD-03) within 30 days

of receipt of memo

Mismatch of exports value as shown in GST Returns and ICE-GATE portal

ITC claimed in GSTR-3B does not reconciled with GSTR-2A for the purpose of refund

claim

In case of shortfall in specific pool for refund, Inter-pool refund claim has not been made

Refund has been claimed under inverted duty structure for input service which is not

eligible under the act & rules

Export data entered in GSTR-1 without submitting Shipping bill details for regular as well

as consignment-confirmed exports

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