Amendments made in Finance Act 2022 notified w.e.f 1st October 2022 vide Notification No. 18/2022 – Central Tax, F.No.CBIC-20013/1/2022-GST, Dated 28th September 2022
Finance Act 2022 made around fifteen amendments which include omissions, insertions, and substitutions made in the CGST Act 2017. They were covered by section 100 to section 114 of the Finance Act, 2022 (6 of 2022). All the amendments made in the Finance Act, 2022 have been notified.
The following notifications have been issued by the Ministry of Finance in order to notify the applicability and the effective date of the amended/introduced sections. Notify Date as 01-10-2022 of Section 16, 29, 34, 37, 38, 39, 41, 47, 48, 49, 52, 54, 168 and omitted 42, 43, 43A, of CGST Act 2017
1. Extension in the time limit to claim ITC under GST: It seeks to amend section 16(4) of the CGST Act, 2017 so as to provide that a registered person shall not be entitled to take the input tax credit in respect of any invoice or debit note after the thirtieth day of November (Earlier this date was 20th Oct i.e. due date for filing GSTR -3B for September) following the end of the financial year to which such invoice or debit note pertains, or furnishing of the relevant annual return, whichever is earlier.
ASC Interpretation: As per the Notification No. 18/2022 of Central Tax, ITC in respect of invoices pertaining to a financial year can be claimed upto 30th November of the next financial year.
2. Amendment in sub-section (2) of section 34 of the CGST Act: To provide for the thirtieth day of November following the end of the financial year, or the date of furnishing of the relevant annual return, whichever is earlier, as the last date for issuance of credit notes in respect of any supply made in a financial year.
ASC Interpretation: As per Notification No. 18/2022 of Central Tax, the date of issuance of credit note in respect of invoices pertaining to a financial year has been extended till 30th November of the next financial year.
3. Amended sub-section (10) of section 49: To allow transfer of amount available in electronic cash ledger under the CGST Act of a registered person to the electronic cash ledger under the said Act or the IGST Act of a distinct person. It also seeks to insert sub-section (12) so as to provide for prescribing the maximum proportion of output tax liability which may be discharged through the electronic credit ledger.
ASC Interpretation: Further amount available in Electronic Cash Ledger of a registered person is now transferable to its deemed distinct person (Having same PAN with different GSTN) under the said amendment. (Facility will be available shortly at GSTN portal)
4. Section 16 of the CGST Act, 2017: By inserting a new clause (BA) in sub-section (2) thereof, so as to provide that input tax credit with respect to a supply may be availed only when such credit has not been restricted in the details communicated to the registered person under section 38.
ASC Interpretation: A new clause has been inserted under section 16 (2) of CGST Act 2017 namely (ba) for providing restrictions in respect of details communicated to registered persons under section 38.
Further, the old section 38 has been replaced with the new one to prescribe the manner, time, conditions and restrictions for communicating details of ITC through an auto-generated system. Also providing for ITC that can be availed or can-not be availed by the recipient.
5. For Section 38 of CGST Act, 2017 following section shall be substituted namely-
ASC Interpretation: A new section 38 has been introduced for the restriction of ITC to claim in GSTR-3B by the recipient. There are so many rules in this relationship which are not yet prescribed.
Following are the Key amendments made under made in Finance Act 2022 notified w.e.f. 01 October 2022. If you need any assistance or clarification with the GST, feel free to contact the ASC Group.
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