GST Goods and Service Tax India - Refund E-commerce Job Work Accounts Audit

Goods and Service Tax
Presented by
Ankit Kr Garg
Topics Covered:
1. Chapter X – Transfer of ITC
2. Chapter XI – Refunds
3. Chapter XII - Accounts & Records
4. Chapter XIII - Special Procedure for Job Work
5. Chapter XIV - E-commerce
6. Chapter XVI - Audit

Chapter X – Transfer of Input Tax
Credit:-
Section 47. Transfer of input tax credit:
On utilization of input tax credit availed under the CGST Act for payment of tax dues under
the IGST Act as per section 44(5), the amount collected as CGST shall stand reduced by an
amount equal to the credit so utilized and the Central Government shall transfer an amount
equal to the amount so reduced from the CGST account to the IGST account in the manner
and time as may be prescribed.
Section 47. Transfer of input tax credit:
IGST
Cental
Govt
State
GovtInternal
Adustment
between CG
and SG

Chapter XI - Refunds
Section 48(3):- Cases where
refund can be granted
Export including Zero
Rated Supplies
When there is inverted
duty structure
Input at
suppose
18%
Output at
suppose
6%

Any person claiming refund of any tax (and interest, if
any, paid on such tax) or any other amount paid by
him, may make an application in that regard to the
proper officer of before the expiry of 2 years from the
relevant date in such form and in such manner as
may be prescribed:
PROVIDED that a registered taxable person, claiming
refund of any balance in the electronic cash ledger as
per section 44(6), may claim such refund in the return
furnished u/s 34 in such manner as may be prescribed.
Analysis
Earlier in Central Excise act there was a time
limit of maximum 1 year for claiming the refund
now it has been increased to 2 years.
Further, this revised GST law does not provide
time limit relief for amounts paid under protest.
This proviso provides for refund of balance u/s
44(6) which states that The balance in the cash or
credit ledger after payment of tax, interest,
penalty, fee or any other amount payable under
the Act
AnalysisSection 48(1). Refund of Taxes

Chapter XI – Refunds
Section 48(2). Refund of Taxes to United Nations Agencies
This section provides refund window to UN and other foreign govt bodies like
embassies. (other org specified under section 49) Presently also the UN and govt bodies
can claim refund of taxes paid by them at the time of receipt of supply. This section
provides time limit of 6 months from the last day of the month in which such supply was
received.
There is not tax on
output services
Input Goods and
Services

The application shall be accompanied by—
(a) such documentary evidence as may be
prescribed to establish that a refund is due to the
applicant, and
(b) such documentary or other evidence as the
applicant may furnish to establish that
• the amount of tax / interest was paid by him
and
• the incidence of such tax and interest had not
been passed on to any other person:
Analysis
With the refund application evidences are
required that tax was paid by him and the
incidence of such tax has not been passed. This
section states the Doctrine of Unjust
Enrichment. (becoming rich unjustifiably on
the expense of other person. CA/Cost
Accountant certificate may be required.)
Further proviso to this section states that if the
refund claimed is less than Rs. 5 Lac then no
evidences will be required. Self declaration
will suffice.
AnalysisSection 48 Refund of Taxes

If, on receipt of any such application, the proper officer is satisfied that the amount claimed as refund is
refundable, he may make an order accordingly and the amount so determined shall be
Section 48(5) & (8). Refund of Taxes
In Case of Doctrine of
Unjust Enrichment
If assesse proves that
burden of tax has not
been passed
Refund shall be credited
to the Consumer Welfare
Fund
Refund shall be credited
to account of assessee
if such amount is relatable to refund of –
a) tax on goods / services exported or on inputs or input services used in the export
b) unutilized input tax credit
c) tax paid on a supply which is not provided and for which invoice has not been issued;
d) tax in pursuance of section 70 (tax wrongfully collected and deposited)
e) the tax /interest/other amount if he had not passed on the incidence
Chapter XI Refunds

Notwithstanding anything contained in sub-section (5),
• the proper officer may,
• in the case of any claim for refund on account of export
• made by registered taxable persons, other than such category of registered taxable persons as
may be notified in this behalf,
• refund on a provisional basis 90% (earlier 80%) of the amount so claimed,
• excluding the amount of input tax credit provisionally accepted
• and thereafter make an order under sub-section (5) for final settlement of the refund claim after
due verification of documents.
Sub-section (7) provides the time limit of 60 days for issue of order of refund. Earlier it was 90 days
which is not decreased in Revised GST law.
Section 48(6). Provisional Refund in Export

Where any refund is due to a registered taxable
person who has defaulted in furnishing any
return or who is required to pay any tax,
interest or penalty, which has not been stayed
by any by the specified date, the proper officer
may—
(a) withhold payment of refund due
(b) deduct from the refund due, any tax,
interest, penalty, fee which is remaining
unpaid.
Section 48(10). Withholding of refund
Where an order giving rise to a refund is the
subject matter of an appeal or where any other
proceeding under this Act is pending and the
Commissioner is of the opinion that grant of such
refund is likely to adversely affect the revenue on
account of malfeasance or fraud committed, he
may, withhold the refund till such time as he may
determine.
Section 48(11)&(12). Withholding of Refund
Powers of Department to Withhold
Refund In Interest Of Revenue

Section 48(13) : Casual taxable persons
Refund to Casual taxable person or a non-resident taxable person shall not be granted
unless such person has, in respect of the entire period for which the certificate of
registration granted to him had remained in force, furnished all the returns required
under section 34.
Non resident having no fixed place of
Business in India
Indian seller not having fixed place of
business in the state where supplying

Section 50. Interest on delayed refunds
If any tax ordered to be refunded under section 48 is not refunded within sixty days from the
date of receipt of application under sub-section (1) of that section, interest at such rate as may
be specified shall be payable in respect of such refund from the date immediately after the
expiry of sixty days from the date of receipt of application under the said sub-section till the
date of refund of such tax.
--60 days-- Period for
which interest
on refundable
amount shall
be granted

Chapter XII – Accounts & Records
Section 53. Accounts and other records
53(1) Every registered taxable person shall keep and maintain, at his principal place of
Business (all PPBs), as mentioned in the certificate of registration, a true and correct account
of:-
1. Inward
Supply
2. Production
manufacture
3. Stock
of Goods
4. Outward
supply
6. Output tax payable5. Input tax credit Proviso allows to maintain such records
electronically also

53(4)
Every registered taxable person whose turnover during a financial year exceeds the
prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant
and shall submit to the proper officer a copy of the audited annual accounts, the
reconciliation statement under sub-section (2) of section 39 and such other documents in the
form and manner as may be prescribed in this behalf.
Effect of non maintenance:-
the proper officer shall determine the amount of tax payable on the goods and/or services that
are not accounted for, as if such goods and/or services had been supplied by such person.

53(6)
Every owner or operator of warehouse or godown or any other place used for storage of
goods irrespective of whether he is a registered taxable person or not shall maintain records
of consigner, consignee and other relevant details of the goods as may be prescribed..

Section 54. Period of
retention of accounts
In Normal cases In case of any
appeal/ hearing
60 Months (5 years) from the due
date of filing of annual return
If the annual returns for the FY
2017-18 are filed on 30.11.2018,
then the books of account and
other records are to be
maintained till 30.11.2023.
1 year after
disposal of
appeal/
proceedings or
hearings
60 Months (5
years) from the
due date of filing
of annual return
Whichever later

Chapter XIII – Job Work
Section 55. Special procedure for removal of goods for certain purposes
2(62) “job work”
means undertaking any treatment or process by a person on goods
belonging to another registered taxable person and the expression “job
worker” shall be construed accordingly;

Section 55. Special procedure for removal of goods for certain purposes
•A registered taxable person (“principal”) may, under intimation and subject to such
conditions as may be prescribed,
•send any inputs and/or capital goods,
•without payment of tax,
•to a job worker
•for job-work and from there subsequently send to another job worker and likewise,

Section 55. Bringing Back the inputs
bring back inputs, after completion of job-
work or otherwise, and/or capital goods, other
than moulds and dies, jigs and fixtures, or tools,
within one year and three years, respectively,
of their being sent out, to any of his place of
business, without payment of tax;
supply such inputs, after completion of job-work
or otherwise, and/or capital goods, other than
moulds and dies, jigs and fixtures, or tools, within
one year and three years, respectively, of their
being sent out from the place of business of a job-
worker on payment of tax within India/export.
PROVIDED that the “principal” shall not supply the goods from the place of business of a job worker unless the
said “principal” declares the place of business of the job-worker as his additional place of business except in a
case-
(i) where the job worker is registered under section 23 ; or
(ii) where the “principal” is engaged in the supply of such goods as may be notified by the Commissioner in this
behalf.

Section 55. Special procedure for removal of goods for
certain purposes
55(2)
The responsibility for accountability of the inputs and/or capital
goods shall lie with the “principal”.

Section 55. When Inputs transferred are not received back within time limit
•Where the inputs/capital goods sent for job-work are not received back by the
“principal” after completion of job-work or otherwise
or
•are not supplied from the place of business of the job worker
•within a period of one year/three years of their being sent out,
•it shall be deemed that such inputs had been supplied by the principal to the job-
worker
•on the day when the said inputs were sent out.

Section 55(5) Treatment of Waste and
Scrap generated out of job work
If Job worker is
registered
If Job worker is not
registered
by the job
worker directly
from his place of
business on
payment of tax
by the principal

Chapter XIV – E-commerce
Section 56. Collection of tax at source
• Every electronic commerce operator (ECO) not being an agent,
• shall collect
• an amount at the rate of 1% of the net value of taxable supplies made through it
where the consideration with respect to such supplies is to be collected by the
operator.
Due Date for Payment = within 10 days after the end of the month in which such
collection is made
Due date for Return = within 10 days after the end of such month
Supplier shall claim such TCS in his electronic cash ledger

Sellers E-commerce Operator Buyers
Govt of India
Collection
of
Proceeds
Payment
after
deducting
TCS
Pay TCS to
Govt (1%) of
supplies
effected by the
operator
Claim of
TCS by
Seller
E-Commerce
Operator: means any
person who owns,
operates or manages
digital or electronic
facility or platform for
electronic commerce;

Matching Concept
Supplier ECO
Govt of India
Filing of
Return of
output
supplies
Filing of
Return of
output
supplies
If there is mismatch and the output supplies
shown in the return of ECO are higher than
as shown in supplier’s return such supplies
shall be taken as output supplies by the
supplier.

Section 56(11). Information from ECO
Any authority not below the rank of Joint Commissioner may serve a notice requiring
the operator to furnish such details relating to—
(a) supplies of goods or services
(b) stock of goods held by the suppliers making supplies through such operator in the
godowns or warehouses managed by such operators and declared as additional
places of business by such
Time Limit to furnish Info = 15 Days
Penalty of Non compliance = Rs 25000 (max)

Chapter XVI – Audit
Section 63. Audit by tax authorities
By Whom - Commissioner of CGST/IGST
may undertake audit of the business transactions of any taxable person
for such period, at such frequency and in such manner as may be prescribed.
Prior Notice - Intimation before at least 15 days
Time limit for completion - 3 Months
Results - Commissioner may initiate suitable actions of recovery if found tax
evasion.
Powers – verify the books of account, ask for information as he may require
Duty - On conclusion of audit, inform findings the taxable person within 30 days

Chapter XVI – Audit
Section 64. Special Audit
Considering
• the nature of transaction and
• nature of complexities and
• to protect the interest of revenue
Dy. / Asst. Commissioner opines w.r.t
• wrong declaration of value or credit,
special audits can be ordered to be carried out
• by Cost Accountant or
• Chartered Accountant.
Time limit for completion of audit – 90 days
Result - Proper officer may initiate action if tax evasion is
detected.

Some images and parts of art work are taken from
internet. These are used for explanation for
academic purposes.

GST Goods and Service Tax India - Refund E-commerce Job Work Accounts Audit

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