Myself Manoj Agarwal, Advocate have been making my little efforts in sharing knowledge on GST at various platforms in the name of GSTsathi. I am making active contribution since the introduction of Constitution Amendment Bill leading to 101st Amendment Act, 2016.

Date: February 14, 2023

To,
Smt. Nirmala Sitharaman,
Hon'ble Minister of Finance,
Government of India,

Hon'ble Madam,

Sub: Representation/suggestions regarding important changes in GST

Myself Manoj Agarwal, Advocate have been making my little efforts in sharing knowledge on GST at various platforms in the name of GSTsathi. I am making active contribution since the introduction of Constitution Amendment Bill leading to 101st Amendment Act, 2016.

Firstly, I would like to take this opportunity to thank you mam for presenting this highly growth-oriented budget for 2023-24. The growth rate of 7%, which is highest among all the major economies is truly remarkable. All this in the background of global disruption caused by 2 years of Covid-19 and more than one year of Russia Ukraine war, is really Amrit Kaal.

Now, GST has been the game changer for the economy, and is evident from average collection of about 1.50 Lakh Crores every month this fiscal. You would appreciate that being a new law, equally applicable from Kashmir to Kanyakumari, which is technology driven, there has been technical and other issues during the implementation stage. I am happy to say that we have majorly overcome that stage of regular glitches and capacity issues.

I put forward the following suggestions for your generous consideration:

1. I request you mam as the Union Finance Minister as well as Chairman of the GST council, to kindly introduce one time amnesty scheme for either waiver or reduction of late fee and penalty for procedural lapses like delay in filing returns like GSTR 1, 3B, 4, 9, 9C, 10, ITC-04, etc for the period from 2017-18 onwards.

2. The litigations are piling up and due to non-functioning of GST Tribunal, taxpayers are forced to move to High Court for smaller issues. So, for quick collection of disputed tax and to reduce litigation, I suggest to introduce a dispute resolution scheme in line with SVLDRS, 2019 which was highly successful. Also, there should be automatic stay of demand till the time limit for filing appeal is over.

3. As last opportunity, a time bound window of say 1 month maybe allowed for claiming ITC by relaxing the limitation u/s 16(4) of CGST Act and also for revocation of any cancelled registration for whatever reasons.

These measures are going to mitigate the genuine hardships of many Taxpayers and boost the confidence of the trade & industry, MSME in particular.

4. GST is a technology driven law and most compliance are required to be done electronically. Therefore section 169 of the CGST Act, inter alia, provides that the Show Cause Notice and the adjudication order shall be deemed to be served on the registered person if the same is either uploaded on the portal or emailed at the registered e-mail ID of the registered person.

This is posing a great challenge to a small section of taxpayers who are either not very much computer savvy or don't have much resources. Due to their ignorance and other reasons, they fail to check their e-mail and portal regarding service of any notice/order. They come to know only when the appeal period is already over and sometimes when bank attachment is done. Effectively, they don't get the opportunity of being heard and are remediless & helpless.

To give relief to this small section of taxpayers, who normally belong to MSME sector, I suggest that before passing any adverse order, the officer must serve a physical copy of the SCN by registered post/speed post on the registered person and allow at least 15 days from the date of service so that principles of natural justice is adhered in letter and spirit.

5. Generally, the statutory amendments related to CGST Act are made effective from a date to be notified by the Central Government. The reason being CGST law has to walk together, hand in hand with SGST laws.

However, this year there is change in the language of commencement clause i.e. sub clause 2 of clause 1 of the Finance Bill 2023 which is reproduced below:

Clause (1)"(2) Save as otherwise provided in this Act, sections 2 to 122 shall come into force on the 1st day of April, 2023"

For the sake of convenience, the text of same clause in Finance Act, 2022 is reproduced to appreciate the difference:

Section (1)"(2) Save as otherwise provided in this Act,—

(a) sections 2 to 85 shall come into force on the 1st day of April, 2022;

(b) sections 100 to 114 shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint."

Evidently, sub-clause 2(b) is missing in the Finance Bill, 2023. The effect is that all the amendments relating to CGST Act shall come into force on the date of assent to the Bill by the President and as soon as the Bill is enacted.

In view of GSTsathi, this is due to inadvertent omission, which needs to be rectified by way of amendment in the Finance Bill, 2023.

Looking forward for a positive response at the earliest.

Thanking You,

Yours Sincerely,