1.     Sec 2(17)(h) – All Activities of Race Clubs to be treated as BUSINESS –

Changes are being made to ensure that all activities related to a race club are included. It may be noted that vide Notifcation No 3/2018 Central Tax dated 23rd January, 2018, the Govt had notified that the value of supply of actionable claim in the form of chance to win in betting , gambling or horse racing in a race club is amended to 100% of the face  value of the bet or the amount paid into the totalisator.

The term “services” in this clause leads to ambiguity, as actionable claims have been defined as ‘goods’ in the CGST Act.

2.     S 2 (102) – Definition of Services – “services” includes facilitating or arranging transactions in securities, eg. – some service charges or service fees or documentation fees or broking charges or such like fees or charges are charged in relation to transactions in securities.

3.     S 7  – Change in definition of Supply – Insert a new sub-section (1A) in section 7 and omit clause (d) of sub-section (1). Now, first an activity has to be “supply” as per S &(1) only then it will be tested as per Sch II.

The recent AAR whereby supply of canteen services by employee to employer is a supply and hence taxable as per Sch II, clause No 6 (b), will be tested now.

4.     Sch I, Item No 4 – import of services by entities which are not registered under GST (say, they are only making exempted supplies ) but are otherwise engaged in business activities is taxed when received from a related person or from any of their establishments outside India.  This will effect the foreign Companies not registered in India.

5.      Sch III – Items which are neither goods nor services –

(i) Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into the taxable territory.

 (ii) – High Seas Sale

(iii) Sale of bonded goods.

6.     9 (4) – Reverse charge on Unregistered Purchases No More for small dealers – Government to notify a class of registered persons who would be liable to pay tax on reverse charge basis in case of receipt of goods from an unregistered supplier.

7.      Sec 10 – Relief to composition dealers – Even if Composition dealers supply services of value not exceeding 10% of the turnover in the preceding financial year in a State/Union territory or Rs. 5 lakhs, whichever is higher, they are eligible for composition scheme.

8.     S 16 (2) (b) – Deemed receipt of Services for ITC – In case of services, the registered person shall be deemed to have received the services where the services are delivered by the supplier to recipient or any other person on the direction of the said registered person. This may benefit Works contractors who are providing services elsewhere and biling elsewhere.

9.     S 16 (2) Second proviso – No Interest on ITC Reversal – Removes the liability to pay interest in case where the recipient has been made liable to pay an amount equal to the ITC availed in case he fails to pay to the supplier of goods or services or both the amount towards the value of supply along with tax payable thereon within a period of 180 days

10. S 17 (3) – No reversal will be required in cases falling under Sch II – including High seas sales, etc.

Availment of ITC allowed on activities or transactions specified in Schedule III (other than sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building) by excluding it from the ambit of ‘exempt supply’ on which ITC is blocked.

11. 17 (5) (a), new (aa) & (b) – Blocked Credit Pruned –

Motor Vehicles – input tax credit would now be available in respect of dumpers, work-trucks, fork-lift trucks and other special purpose motor vehicles, vessels and aircraft when these are used for personal purposes.

ITC allowed for motor vehicles used for transportation of money for or by a banking company or a financial institution.

ITC allowed in respect of food and beverages or both where the provision of such goods or services or both is obligatory for an employer to provide to its employees under any law for the time being in force.

12. S 22 – Registration threshold limit to go up in Assam also from Rs. 10 Lakhs to Rs. 20 Lakhs

13.  S 24 (x)  –  Small e-commerce operators who are not required to collect TCS u/s 52 would not be liable for registration.

14. S 25(2) – New 2nd, 3rd & 4th Provisio –  Persons having multiple places of business in a State or Union territory may obtain separate registrations for each such place of business. Separate registration for a person having a unit(s) in a SEZ.

15. S 34 (1) & S 34(3) – Single Cr/ Dr Note allowed for multiple invoices

16. Sec 35 (5) – Any department of the Central or State Government / local authority which is subject to audit by CAG need not get their books of account audited by a CA/ CMA.

17.  S 39 (9) Returns  – Returns may be amended – It is proposed to provide for allowing taxpayers to amend the returns.

18. New S 43 A – A new section is being introduced in order to enable the new return filing procedure as proposed by the Returns Committee and approved by GST Council.

19. New Sec 49 (5A) – Government may prescribe any specific order of utilization of ITC. Maybe the Govt is looking to remove the restrictions for utilization of IGST/ CGST/SGST/ UTGST against each other in near future.

20. S 54 of CGST Act & S 2(6)(iv) of IGST Act – Service Exports to Nepal or Bhutan to qualify as “Exports” even if payment is received in INR as allowed by RBI

21. S 79(1) – Recovery can be made from any branch of a registered person in any state.

22. S 140(1) – CENVAT Credit on only “Eligible duties” can be availed – Section to eliminate dispute of Transition of EC, SHEC & KKC in GST. Further CVD us 3(1) of Customs Tariff Act has been excluded from eligible duty.

23. S 12(8) of IGST Act – Transportation of goods from a place in India to a place outside India by a transporter located in India would not be chargeable to GST, as place of supply will be outside India.

24. Provisio to S 13(3)(a) of IGST Act – No tax job work of any treatment or process done on goods temporarily imported into India which are then exported.

25. Sec 2(4) – Anti Profitering Authority to be excluded from definition of Adjudicating Authority

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