Circulars

Government of India
Ministry of Finance
(Department of Revenue)

Central Board of Indirect Taxes and Customs
Notification No. 74/2019 – Central Tax

New Delhi, the 26th December, 2019
G.S.R…..(E),– In exercise of the powers conferred by section 128 of the Central Goods and
Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the
Council, hereby makes the following further amendment in the notification of the Government of
India in the Ministry of Finance, Department of Revenue No. 4/2018– Central Tax, dated the

23rd January, 2018, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-
section (i) vide number G.S.R. 53(E), dated the 23rd January, 2018, namely:–

In the said notification, after the second proviso, the following proviso shall be inserted,
namely:–
“Provided also that the amount of late fee payable under section 47 of the said Act shall stand
waived for the registered persons who failed to furnish the details of outward supplies in FORM
GSTR-1 for the months/quarters from July, 2017 to November, 2019 by the due date but
furnishes the said details in FORM GSTR-1 between the period from 19th December, 2019 to
10th January, 2020.”.
2. This notification shall be deemed to have come into force with effect from the 19th day of
December, 2019.

[F.No.20/06/09/2019-GST]

(Ruchi Bisht)
Under Secretary to the Government of India
Note: The principal notification No. 4/2018-Central Tax, dated 23rd January, 2018 was
published in the Gazette of India, Extraordinary, vide number G.S.R. 53(E), dated the 23rd
January, 2018 and was subsequently amended by notification No. 75/2018-Central Tax, dated
the 31st December, 2018, published in the Gazette of India, Extraordinary, vide number G.S.R.
1252(E), dated the 31st December, 2018.

1 Income Tax

2 Goods & Service Tax (GST)

3 Fema

4 International Taxation

5 Company Law

Income Tax
Jurisdiction of Assessing Officer
In the case of The Tata Power Co Ltd vs. ACIT Circle 2(3), Mumbai ITAT held that
As per section 2(7A) of the Act, AO means inter alia an Addl. CIT who is directed under section
120(4)(b) to exercise or perform all or any of the powers and functions conferred on, or assigned to, an
AO under the Act. As per Section 120(4)(b), the CBDT has to first empower the Commissioner to issue
orders and then the said authority has to assign or confer the authority of the AO on the Addl. CIT. In
the present case none of such notifications/ orders as required by section 120(4)(b) of the Act have
been issued.
Further, as per section 127 of the Act when there is a transfer or jurisdiction, then the condition therein
has to be fulfilled. In the present case, originally the jurisdiction to make the assessment over the
company was with the DCIT. The assessment order has been passed by the Addl. CIT without any
transfer or jurisdiction in his favour. Assessment framed under section 143(3) quashed.
Bogus Long-Term Capital Gain on shares
In the case of Ms. Anvi Khandelwal vs. Income Tax Officer, Delhi ITAT has held that:
In the case of Sanat Kumar ITAT Delhi dealt with a similar situation, and made an observation that
though the assessee meticulously completed the paperwork by routing his entire investments through
banking channel, when the result of an altogether beyond human properties, what is apparent in
making investment is not really and the examination of the entire transaction falsifies the same. The
conduct of the assessee who is a novice, in investing in the stocks of a company whose financial
results are not brilliant and where there is no apparent chance of lucrative gains at the me when such
an investment was made – raises reasonable doubt to suspect the bona fides of the transaction and in
the absence of any satisfactory explanation offered by the assessee on the vital points raised by the
learned Assessing Officer, it is not possible to brush aside the orders of the authorities below. Both the
authorities below have the cogent reasons for reaching the conclusions and we find it difficult to
interfere with the same. With this view of the matter, we dismiss the grounds of assesssee.
No Capital Gain on transfer of property from Partner to Firm
In the case of Shri Mahendra Zalavadia vs. ITO 1(1)(4), ITAT Rajkot has held that
Land was transferred by the assessee to the partnership firm in the year ending as on 31st March
2005 corresponding to the assessment year 2005-06. This fact can be verified from the partner’s
capital account in the partnership firm which is placed on page 6 of the paper book. Admittedly, the
impugned land was transferred by the partners to the firm as capital contribution which was recorded
as stock-in-trade in the books of the firm. As such there was no transfer of capital assessee as stock-
in-trade in the books of the assessee.
Therefore, in our considered view, there cannot be any application of the provisions of section 45(2) of
the Act in the hands of the assessee.
Provisions of section 45(3) of the Act requires to take the sale consideration in the case of transfer of
any capital asset by the partner to the firm as capital contribution which was recorded in the books of
accounts of the firm. In the case on hand, there is no dispute that the value of such assets transferred
by the partner to the firm was recorded at the book value which can be verified from the financial
statements of the assessee placed on pages 2 to 7 of the paper book. Accordingly, there cannot be
any income in the hands of the assessee on account of transfer of such assets as capital contribution.
In view of the above, we do not find any infirmity in the order of the learned CIT-A. Hence the ground
of appeal of the Revenue is dismissed.

GST (Goods & Service Tax)
CBIC mandates quoting Document Identification Number (DIN) on all communications issued to
taxpayers from November 8, 2019
The CBIC has issued a circular on the procedure to be followed for generation and quoting of
Document Identification Number (DIN) on any communication issued by the CBIC officers to taxpayers
and other concerned persons.
It has been clarified that any specified document issued without the DIN shall be treated as invalid and
deemed to have never been issued.
The circular states that a communication may be issued without a DIN in the following exception
circumstances:
 Where there are technical difficulties, or
 When the communication is required to be issued at a short notice or in urgent situations
However, it has been clarified that in such cases, the communication should be regularized within 15
working days of its issuance.
[Circular No.122/41/2019 – GST dated November 5, 2019]
Extension of due date for filing Form GSTR-9 and Form GSTR-9C
and 2018-19 for FY 2017-18
Pursuant to various representations received regarding difficulties in filing of Form GSTR-9 (Annual
Return) and Form GSTR-9C (Reconciliation Statement), the CBIC has now extended the due dates of
the said forms for financial year (FY) 2017-18 and 2018-19 as follows:
Period Earlier Due Date Revised Due Date
FY 2017-18 November 30, 2019 December 31, 2019
FY 2018-19 December 31, 2019 March 31, 2020
[Order No. 08/2019-Central Tax dated November 14, 2019]
Withdrawal of Circular No. 107/26/2019 – GST dated July 18, 2019
Pursuant to representations received expressing apprehensions on the implications of the Circular No.
107 dated July 18, 2019 providing clarifications on supply of ITES / ITES enabled services as
intermediary services, the CBIC has finally withdrawn this Circular.
[Circular No.127/46/2019 – GST dated December 4, 2019]

FEMA
Review of Policy for Non-resident Rupee Accounts
In terms of existing regulations on “Deposits and Accounts”, any person resident outside India, having
a business interest in India, may open a Special Non-Resident Rupee Account (SNRR account) with
an authorized dealer for the purpose of putting through bona fide transactions in rupees.
With a view to promote the usage of INR products by persons resident outside India, it has been
decided by the Reserve Bank of India (RBI), in consultation with the Government of India, to expand
the scope of SNRR Account by perming person resident outside India to open such account for:
 External Commercial Borrowings in INR;
 Trade Credits in INR;
 Trade (Export/ Import) Invoicing in INR; and
 Business related transactions outside International Financial Service Centre (IFSC) by IFSC
units at GIFT city like administrative expenses in INR outside IFSC, INR amount from sale of
scrap, government incentives in INR, etc. The account will be maintained with bank in India
(outside IFSC).
It has also been decided, in consultation with the Government of India, to rationalize certain other
provisions for operation of the SNRR Account, as under:
 Remove the restriction on the tenure of the SNRR account opened for the above purposes as
the proposed transactions are more enduring in nature.
 Apart from Non-Resident Ordinary (NRO) Account, permit credit of amount due/ payable to non-
resident nominee from account of a deceased account holder to Non-Resident External (NRE)
Account or direct remittance outside India through normal banking channels.
All other provisions of the policy on Deposits and Accounts remain unchanged.
(RBI/2019-20/102/A.P. (DIR Series) Circular No. 09 dated November 22, 2019)

International Taxation
Non-compete fees received by a nonresident, not taxable in the absence of a PE in India
Based on the facts and in the circumstances of the case, recently the Mumbai bench of Income Tax
Appellate Tribunal in the case of Prabhakar Raghavendra Rao, the tax payer, held that non-compete
fees received by a nonresident individual taxpayer shall not be taxable in India unless such non-
resident has a permanent establishment (PE) in India. Mere holding of shares in an Indian company
cannot be construed to constitute a PE in India.
The Tribunal reiterated that business income in the hands of non-resident will not be taxable in the
absence of a business connection/ PE in India, and that business connection is not established merely
on account of being a shareholder/ promoter in an Indian company.
(Prabhakar Raghavendra Rao v. ITO (ITA No.3985/Mum/2018))

Company Law
General Circular regarding extension of the last date of filing of Form NFRA-2
Original Rules-
The Ministry of Corporate Affairs vide its circular No.14 dated 27th November, 2019 stated that, the
me- limit for filing Form NFRA-2 is decided as within 90 days from the date of deployment of such form
on MCA website.
http://www.mca.gov.in/Ministry/pdf/NFRA_27112019.pdf

General Circular regarding relaxation of Additional fees and extension of last date of filing
Forms MGT-7 (Annual Return) and AOC-4 (Financial Statement) under the Companies Act,
2013UT of J&K and UT of Ladakh
The Ministry of Corporate Affairs vide its circular no.15 dated 28th November, 2019 informed that, in
continuation with earlier General Circular No.13 dated 29.10.2019 [(Relaxation of Additional Fees and
extension of last date of filing of Forms MGT-7 (Annual Return) and AOC-4 (Financial Statement)
under the Companies Act, 2013], decided to extend the due date for filing e-form AOC-4, AOC-4
(CFS), AOC-4 XBRL and Form MGT-7 up to 31.01.2020 for companies having jurisdiction in the UT of
J&K and UT of Ladakh without levy of additional fees.
http://www.mca.gov.in/Ministry/pdf/MGTAnnualReturnAOC4FinancialStatement_28112019.pdf
General Circular regarding extension of last date of filing of Form PAS-6
The Ministry of Corporate Affairs vide its circular no.16 dated 28th November, 2019 informed that, last
date of filing Form PAS-6 [(Reconciliation of Share Capital Audit Report (Half-yearly) pursuant to sub-
rule (8) of rule 9A Companies (Prospectus and Allotment of Securities) Rules, 2014]] which is to be
filed for half year ended on 30.09.2019 has been decided as within 60 (Sixty) days from the dated of
deployment of form.
http://www.mca.gov.in/Ministry/pdf/FormPAS6_28112019.pdf
National Company Law Tribunal (Salary, Allowances and other Terms and Conditions of
Service of President and other Members) Amendment Rules, 2019
Original Rules-
National Company Law Tribunal (Salary, Allowances and other Terms and Conditions of Service of
President and other Members) Rules, 2015.
Effective Date of Amendment:
23rd November, 2019.
Amendment
to amend existing rule to insert new rule 15A (Posting and transfer of members) in the existing rule.
http://www.mca.gov.in/Ministry/pdf/ActRules_28112019.pdf

To
All the Managing Committee Members
All Affiliated Associations and Former Presidents of FPTA.

NOTICE – 2ND MEETING OF THE MANAGING COMMITTEE 2019-20

Notice is hereby given that the Second Meeting of the Managing Committee (2019-20) of the Federation
of Paper Traders’ Associations of India will be held at Pune under the auspices of Pune Paper Traders’
Association, Pune.
The details of venue, date and timing are as under:
Venue : HOTEL HYATT

88, NAGAR ROAD, ADJACENT TO AGA KHAN PALACE

KALYANI NAGAR, PUNE – 411 006
TEL: 020 41411234
Date : 04 th & 05 th January 2020
Timings : As per tentative programme attached.

AGENDA
The following items will form the agenda for the meeting.
1. To confirm the draft minutes of the 4 th meeting of the managing committee (2018-19) and 1 st
meeting of the managing committee (2019-20) held on 21 st & 23 rd September 2019 respectively.
2. To consider applications for membership for Life Associate, Patron and Ordinary Member, if any.
3. To review the outstanding subscription and other arrears of Members.
4. To discuss status and advertisements in our All India Paper Traders Telephone Directory.
5. Discussion on Current Market Scenario.
6. Report of Shri. A. Natesan Convener of Advisory Board.
7. To discuss reports of Vice-Presidents and Conveners of the Sub-committees circulated.
8. Discussion for 3 rd Meeting of Managing Committee to be hosted by Sivakasi Paper Merchants’
Association, Sivakasi.
9. Any other matter with the permission of the chair.
Yours faithfully,
For Federation of the Paper Traders’ Associations of India,

Hiren Karia
Hon Secretary
Cc. All Patrons, Life & Ordinary Associate members.
IMPORTANT

Managing committee members are requested to co-operate with the hosts, while registering, attending
the meetings and inform well in time regarding their schedule of arrival and departure programmes.
(Please also send copies of your correspondence to the host Pune Paper Traders Association, Pune
and copy to FPTA office to give you the necessary supporting help)

FPTA

2
Tentative Program

Saturday 04th January 2020

8.30 Am to 10.30 Am : Registration and Breakfast
10.00 Am to 11.30 Am : Advisory Board Meeting
11.45 Am to 1.00 Pm : 1st Business Session
1.00 Pm to 2.00 Pm : Lunch
2.30 Pm to 4.30 PM : 2nd Business Session
4.30 Pm to 5.00 Pm : Hi Tea
6.00 Pm to 7.30 Pm : Inauguration
8.00 Pm Onwards : Dinner

Sunday 05th January 2020

7.30 AM to 9.30 Am : Breakfast
9.30 Am to 10.00 Am : Check out
10.00 Am to 12.15 Pm : 3 rd Business Session
12.15 Onwards : Lunch

Please send your photo along with travel details to office of Pune Paper Traders
Association or email: thepunepaper@gmail.com , before 20.12.2019. All members
attending the event must carry their ID Proof for Check in.
Members under Life/Patron/Observer categories who wish to participate in the 2nd
Managing Committee Meeting, fees have been fixed at Rs. 8000/- (Rupees Eight
Thousand Only) each. This amount to be remitted by way of Cheque/DD in favour of
Pune Paper Traders Association.
Contact Persons:
Shri. Deepak Shah President – 9422023571
Shri. Yashaswi Patel Hon. Secretary – 9960976143
Shri. Sushesh Patel Chairman Reception Committee – 9422025160
Note: If stay required a day prior, it is chargeable for Rs. 6,500/- per person.
Standard Check-In Time of Hotel is at 02.00 pm. Early Check – In rooms if
available, will be allotted on First cum First Serve basis

1 Income Tax

2 Goods & Service Tax (GST)

3 International Taxation

4 Company Law

Income Tax
Just 15% of Outstanding arrears of corporate tax recovered in five years
The government has been able to recover just 15 per cent of the total outstanding arrears of corporate
tax of Rs 20,78,267 crores in the last five years.
The data presented by the Ministry of Corporate Affairs to the Lok Sabha while replying to a written
question in July this year, reveals that arrears of Rs 3,19,248 crore have been recovered from
defaulters. Data shows that in the last three fiscals, the government was unable to collect even 20 per
cent of the corporate tax arrears annually.
“A substantial part of the outstanding taxes is not readily collectible due to various reasons, including
companies in liquidation, before NCLT under the Insolvency and Bankruptcy Code, and companies not
having adequate assets for sale and recovery,” the Ministry stated.
Source: https://www.thehindubusinessline.com
Extension of Due Date for Filing Tax Return and Audit Report for Union Territory of Jammu &
Kashmir and Union Territory of Ladakh
On consideration of reports of disturbances in internet facility in certain areas of Jammu and Kashmir,
the Central Board of Direct Taxes (CBDT), in exercise of powers conferred under section 119 of the
Income-tax Act, 1961 (’Act’) and in partial modification of CBDT’s order under section 119 of the Act
dated 23.07.2019 and 27.09.2019, hereby further extends the ‘due-date’ for filing of Income tax
Returns/Tax Audit Reports to 30th November, 2019 in respect of all categories of income-tax
assessees in the Union Territory of Jammu and Kashmir and Union Territory of Ladakh who were/are
required to file the Income-tax Returns/Tax Audit Reports by the due date specified under section
139(1) of the Act read with orders of CBDT under section 119 of the Act dated 23.07.2019 and
27.09.2019.
It is also clarified that ITRs filed by the certain categories of income-tax assessees who were required
to file ITRs by 31.08.2019, but have filed ITRs after 31.08.2019 till the date of issuance of this order
shall be deemed to have been filed within the due date specified under section 139(1) of the Act read
with CBDT&’s order section 119 of the Act dated 23.07.2019.
(https://www.incometaxindiaefiling.gov.in/eFiling/Portal/StacPDF_News/Extension_of_Due_Date_of_Income_Tax_
Returns-dated-31-10-2019.pdf).

GST (Goods & Service Tax)
New Provisions to Claim GST Input Tax Credit
As notified by GST authorities, GST Input Tax Credit (ITC) will be available only to the extent of 120%
of Eligible ITC as per GSTR-2A reflected on GSTIN Portal. For Example:
Sr No. Particulars Amount (INR)
A) ITC as per Books 2,000/
B) 1,500/
Invoices not uploaded by Supplier (A-B) 500/
C) Eligible ITC (B*120%) 1,800/
(1,500*120%)

D) ITC not available (A-C)

(In respect of invoices not uploaded by the supplier in their
GSTR-1, however it will be available when the invoices are
uploaded i.e. when reflected on GSTR-2A)

200/

Hence, Even though assessee have total ITC of INR 2,000/- The assessee cannot claim it completely
while discharging its Tax liability in GSTR-3B as the suppliers have not uploaded invoices in GSTR-1.
Further the Unclaimed ITC as per above illustration (i.e. 200/-) can be claimed as ITC in GSTR-3B for
succeeding tax period once the same gets reflected in GSTR-2A.
[Notification No. 49/2019 – GST dated 9th October, 2019]
Clarification regarding determination of place of supply in case of software/design services
related to Electronics Semiconductor and Design Manufacturing (ESDM) industry
The following clarifications have been provided by GST authorities
In contracts where service provider is involved in a composite supply of software development and
design for integrated circuits electronically, testing of software on sample prototype hardware is often
an ancillary supply, whereas, chip design/software development is the principal supply of the service
provider. The service provider is not involved in software testing alone as a separate service. The
testing of software/design is aimed at improving the quality of software/design and is an ancillary
activity. The entire activity needs to be viewed as one supply and accordingly treated for the purposes
of taxation. These cases are fact based and each case should be examined for the nature of supply
contracted.
Therefore, it is clarified that the place of supply of software/design by supplier located in taxable
territory to service recipient located in non-taxable territory by using sample prototype hardware / test
kits in a composite supply, where such testing is an ancillary supply, is the location of the service
recipient as per Section 13(2) of the IGST Act. Provisions of Section 13(3)(a) of IGST Act
(performance-based services) do not apply separately for determining the place of supply for ancillary
supply in such cases.
[Circular No. 118/37/2019 – GST dated 11th October, 2019]

International Taxation
Offshore supply of equipment by an Italian company to Indian telecom operators in not taxable
in the absence of a PE and business connection in India
Based on the facts and in the circumstances of the case, recently the Delhi bench of Income Tax
Appellate Tribunal in the case of Siemens Mobile Communications SPA, the tax payer, held that
offshore supply of equipment to telecom operators in India cannot be brought to tax in the absence of
a Permanent Establishment (PE) in India under the India-Italy Tax Treaty and in the absence of
business connection under the Indian Income Tax Act, 1961.
The role of tax payer was limited to mere supply of hardware components directly from Italy in such a
manner that the sales stood concluded, title transferred and consideration received outside India. The
tax payer was neither responsible for, nor undertook installation, testing and commissioning, the same
being the responsibility of the telecom operator themselves. Accordingly, in view of the no PE or
Business Connection in India, the Tribunal held that no income can be attributed to India.
(Siemens Mobile Communications SPA v. DCIT (ITA No. 2810/Del/2003) – Taxsutra.com)
Business Support Service fees received by a foreign company from its Indian subsidiary are
not taxable as royalty under the India Netherlands tax treaty
Based on the facts and in the circumstances of the case, recently the Mumbai bench of Income Tax
Appellate Tribunal in the case of Van Oord Dredging and Marine Contractors BV, the tax payer, held
that fees received by a foreign company for rendering business support services to its Indian
subsidiary cannot be treated a royalty under the India-Netherlands Tax Treaty since there was neither
imparting of any know-how nor transfer of any knowledge, skill or experience.
(Van Oord Dredging and Marine Contractors BV v. DCIT (ITA No. 4136/Mum/2016) -Taxsutra.com)

Company Law
The Companies (Meetings of Board and its Powers) Amendment Rules, 2019
Original Rules-
The Companies (Meetings of Board and its Powers) Rules, 2014
Effective Date of Amendment:
11th October, 2019
Amendment
to amend sub – rule 2 of rule 11 (Loan and investment by a company under section 186 of the Act) of
the Companies (Meetings of Board and its Powers) Rules, 2014 to substitute words “business of
financing industrial enterprises” at the place of “business of financing of companies” for the purpose of
any loan made, any guarantee given or any security provided or any investment made by a banking
company, or an insurance company, or a housing finance company in the ordinary course of its
business, or a company established with the object of and engaged in the business of financing
industrial enterprises, or of providing infrastructural facilities,”.
http://www.mca.gov.in/Ministry/pdf/MeetingsBoardPowersAmendtRules11102019.pdf
General Circular regarding relaxation of additional fees and extension of last date of filing of
Form CRA-4 (Cost Audit report)
The Ministry vide its circular No.12 dated 24.10.2019 informed that, the me- limit for filing Form CRA is
extended up to 31.12.2019 without payment of additional fee and thereafter fee and additional fee shall
be payable.
http://www.mca.gov.in/Ministry/pdf/GeneralCircular_25102019.pdf
General Circular regarding relaxation of additional fees and extension of last date of filing of
Forms MGT – 7 (Annual Return) and AOC-4 (Financial Statement)
The Ministry vide its circular No.13 dated 29.10.2019 informed that, the me- limit for filing Form AOC –
4 (including Form AOC -4 XBRL and Form AOC – 4 CFS) and Form MGT – 7 is extended up to
30.11.2019 and 31.12.2019 respectively without payment of additional fee and thereafter fee and
additional fee shall be payable.
http://www.mca.gov.in/Ministry/pdf/GeneralCircular_29102019.pdf
General Circular regarding relaxation of additional fees and extension of last date of filing of
Form IEPFA -1A and IEPF – 2
The Ministry vide its circular No.11 dated 25.10.2019 informed that, the me- limit for filing Form IEPFA
– 1A and IEPF – 2 is extended up to 31.12.2019 and 30.11.2019 respectively without payment of
additional fee and thereafter fee and additional fee shall be payable.
http://www.mca.gov.in/Ministry/pdf/GeneralCircular1_25102019.pdf
The Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019:
Original Rules-
The Companies (Appointment and Qualification of Directors) Rules, 2014
Effective Date of Amendment:
1st December, 2019

Date of Notification
22nd October, 2019
Amendment
To amend Rule 6 (Compliances required by a person eligible and willing to be appointed as an
independent director) of The Companies (Appointment and Qualification of Directors) Rules, 2014.
http://www.mca.gov.in/Ministry/pdf/CmpFihAmndtRules_22102019.pdf
The Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019
Date of insertion on New Rule:
22nd October, 2019
Date of Notification:
22nd October, 2019
Effective date of Notification
1st December, 2019
Highlights of The Companies (Creation and Maintenance of databank of Independent Directors)
Rules, 2019:
There are 5 sub-rules in said rule which includes definitions, details process of creation and
maintenance of data bank of Independent Directors, dues of Institute regarding creation and
maintenance of data bank of Independent Directors, panel of members nominated by Central
Government, etc.
http://www.mca.gov.in/Ministry/pdf/CmpInpdtDirectorsRules_22102019.pdf
Companies (Accounts) Amendment Rules, 2019:
Original Rule-
The Companies (Accounts) Rules, 2014.
Date of Notification:
22nd October, 2019
Effective date of Notification
1st December, 2019
Amendment
Amendment in rule 8 of The Companies (Accounts) Rules, 2014 to include a statement regarding
opinion of the Board with regard to integrity, expertise and experience (including the proficiency) of the
independent directors appointed during the year applicable to certain class of Companies.
http://www.mca.gov.in/Ministry/pdf/CmpAccAmndtRules_22102019.pdf
Notification regarding jurisdiction of Registrar of Companies, Jammu in respect of Union
territory of Jammu and Kashmir and Union territory of Ladakh for the purpose of registration of
companies & discharging the related functions

Notification:
In exercise of the powers conferred by sub-sections (1) and (2) of section 396 of the Companies Act,
2013 (18 of 2013), the Registrar of Companies Jammu shall have jurisdiction in respect of Union
territory of Jammu and Kashmir and Union territory of Ladakh, for the purpose of registration of
companies and discharging the functions under the aforesaid Act.
Date of Notification:
30 th October, 2019
Effective date of Notification
31st October, 2019
http://www.mca.gov.in/Ministry/pdf/J&KNotificationSect396_30102019.pdf

Respected Members
 
As you may be aware that the GST Council has decided to introduce electronic-invoice (hereinafter called as E-invoice) on a voluntary basis from January 2020.

The GST Council has approved the introduction of ‘E-invoicing’ or ‘electronic invoicing’ in a phased manner for reporting of business to business (B2B) invoices to GST System, starting from 1st January 2020 on a voluntary basis. Since there was no standard for e-invoice existing in the country, the standard for the same has been finalized after consultation with trade/industry bodies as well as ICAI after keeping the draft in public place. Having a standard is a must to ensure complete inter-operability of e-invoices across the entire GST eco-system so that e-invoices generated by one software can be read by any other software, thereby eliminating the need of fresh data entry – which is a norm and standard expectation today. The machine readability and uniform interpretation is the key objective. This is also important for reporting the details to the GST System as part of Return. Apart from the GST System, adoption of a standard will also ensure that an e-invoice shared by a seller with his buyer or bank or agent or any other player in the whole business eco-system can be read by machines and obviate and hence eliminate data entry errors.

The GST Council approved the standard of e-invoice in its 37th meeting held on 20th Sept 2019 and the same along with schema has been published on GST portal. Standards are generally abstruse and thus an explanation document is required to present the same in common man’s language. Also, there is a lot of myth or misconception about e-Invoice. The present document is an attempt to explain the concept of e-invoice, how it operates and the basics of standards. It also contains FAQs which answer the questions raised by people who responded to the draft e-invoice standard used for public consultation. It is expected that the document will also be useful for the taxpayers, tax consultants and the software companies to adopt the designed standard.

For details on the concept and FAQs on ‘E-Invoicing’ or ‘electronic invoicing’, please click here.

For downloading schema & template of ‘E-Invoicing’, please click here.
 
This is for your information.
 
Regards
For FPTA
Hiren Karia
Hon. Secretary
The information has been received from an external source; FPTA does not in any way assure the accuracy of the same. The information has been sent to members for their knowledge and academic purpose only.

[To be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i)]

Government of India
Ministry of Finance
(Department of Revenue)

Central Board of Indirect Taxes and Customs
Notification No. 49/2019 – Central Tax

New Delhi, the 9

th October, 2019
G.S.R……(E). – In exercise of the powers conferred by section 164 of the Central Goods and
Services Tax Act, 2017 (12 of 2017), the Central Government hereby makes the following rules
further to amend the Central Goods and Services Tax Rules, 2017, namely:-
1. (1) These rules may be called the Central Goods and Services Tax (Sixth Amendment) Rules,
2019.
(2) Save as otherwise provided in these rules, they shall come into force on the date of their
publication in the Official Gazette.
2. In the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as the said rules),
in rule 21A,-
(a) in sub-rule (3), the following explanation shall be inserted, namely:-
“Explanation.-For the purposes of this sub-rule, the expression “shall not make any
taxable supply” shall mean that the registered person shall not issue a tax invoice and,
accordingly, not charge tax on supplies made by him during the period of suspension.”;
(b) after sub-rule (4), the following sub-rule shall be inserted, namely:-
“(5) Where any order having the effect of revocation of suspension of registration has
been passed, the provisions of clause (a) of sub-section (3) of section 31 and section 40 in
respect of the supplies made during the period of suspension and the procedure specified
therein shall apply.”.
3. In the said rules, in rule 36, after sub-rule (3), the following sub-rule shall be inserted,
namely:-
“(4) Input tax credit to be availed by a registered person in respect of invoices or debit notes, the
details of which have not been uploaded by the suppliers under sub-section (1) of section 37,
shall not exceed 20 per cent. of the eligible credit available in respect of invoices or debit notes
the details of which have been uploaded by the suppliers under sub-section (1) of section 37.”.
4. In the said rules, in rule 61,-

(a) for sub-rule (5), the following sub-rule shall be substituted, with effect from the 1st July,
2017 namely:-
“(5) Where the time limit for furnishing of details in FORM GSTR-1 under section 37 or in
FORM GSTR-2 under section 38 has been extended, the return specified in sub-section (1) of
section 39 shall, in such manner and subject to such conditions as the Commissioner may, by
notification, specify, be furnished in FORM GSTR-3B electronically through the common
portal, either directly or through a Facilitation Centre notified by the Commissioner:
Provided that where a return in FORM GSTR-3B is required to be furnished by a person
referred to in sub-rule (1) then such person shall not be required to furnish the return in FORM
GSTR-3.”;
(b) sub-rule (6) shall be omitted with effect from the 1st July, 2017.
5. In the said rules, in rule 83A, in sub-rule (6), for clause (i), the following clause shall be
substituted, namely:-
“(i) Every person referred to in clause (b) of sub-rule (1) of rule 83 and who is enrolled
as a goods and services tax practitioner under sub-rule (2) of the said rule is required to
pass the examination within the period as specified in the second proviso of sub-rule (3)
of the said rule.”.

6. In the said rules, in rule 91, –
(a) in sub-rule (3), with effect from the 24th September, 2019, after the words “application for
refund”, the words “on the basis of a consolidated payment advice:” shall be inserted;
(b) after the sub-rule (3), with effect from the 24th September, 2019, the following sub-rule shall
be inserted, namely:-
“(4) The Central Government shall disburse the refund based on the consolidated payment
advice issued under sub-rule (3).”.
7. In the said rules, in rule 97, –
(a) after sub-rule (7), with effect from the 1st July, 2017, the following sub-rule shall be inserted,
namely,-
“(7A) The Committee shall make available to the Board 50 per cent. of the amount
credited to the Fund each year, for publicity or consumer awareness on Goods and
Services Tax, provided the availability of funds for consumer welfare activities of the
Department of Consumer Affairs is not less than twenty-five crore rupees per annum.”;
(b) in sub-rule (8), with effect from the 1st July, 2017, clause (e) shall be omitted.
8. In the said rules, in rule 117, –

(a) in sub-rule (1A) for the figures, letters and word “31st March, 2019”, the figures, letters and
word “31st December, 2019” shall be substituted.
(b) in sub-rule (4), in clause (b),in sub-clause (iii), in the proviso for the figures, letters and
word “30th April, 2019”, the figures, letters and word “31st January, 2020” , shall be
substituted.

9. In the said rules, in rule 142, –
(a) after sub-rule (1) the following sub-rule shall be inserted, namely:-
“(1A) The proper officer shall, before service of notice to the person chargeable with tax,
interest and penalty, under sub-section (1) of Section 73 or sub-section (1) of Section 74, as the
case may be, shall communicate the details of any tax, interest and penalty as ascertained by the
said officer, in Part A of FORM GST DRC-01A.”;
(b) in sub-rule (2), after the words “in accordance with the provisions of the Act”, the words,
figures and brackets “, whether on his own ascertainment or, as communicated by the proper
officer under sub-rule (1A),” shall be inserted;
(c) after sub-rule (2) the following sub-rule shall be inserted, namely:-
“(2A) Where the person referred to in sub-rule (1A) has made partial payment of the amount
communicated to him or desires to file any submissions against the proposed liability, he may
make such submission in Part B of FORM GST DRC-01A.” .
10. In the said rules, after FORM GST DRC-01, the following form shall be inserted, namely:-

“FORM GST DRC-01A

Intimation of tax ascertained as being payable under section 73(5)/74(5)

[See Rule 142 (1A)]
Part A

No.: Date:
Case ID No.
To
GSTIN…………………………
…Name………………………
……
Address………………………

Sub.: Case Proceeding Reference No………………- Intimation of liability under
section 73(5)/section 74(5) – reg.
Please refer to the above proceedings. In this regard, the amount of
tax/interest/penalty payable by you under section 73(5) / 74(5) with reference to the said
case as ascertained by the undersigned in terms of the available information, as is given
below:
Act Period Tax

CGST Act
SGST/UTGST Act
IGST Act
Cess
Total
The grounds and quantification are attached / given below:

You are hereby advised to pay the amount of tax as ascertained above
alongwith the amount of applicable interest in full by …….. , failing which Show
Cause Notice will be issued under section 73(1).
You are hereby advised to pay the amount of tax as ascertained above alongwith
the amount of applicable interest and penalty under section 74(5) by …….. ,
failing which Show Cause Notice will be issued under section 74(1).
In case you wish to file any submissions against the above ascertainment, the
same may be furnished by……… in Part B of this Form

Proper Officer
Signature………………

Name……………………

Designation……………

Upload Attachment

Part B

Reply to the communication for payment before issue of Show Cause Notice

[See Rule 142 (2A)]

No.: Date:
To
Proper Officer,
Wing / Jurisdiction.
Sub.: Case Proceeding Reference No………………- Payment/Submissions in
response to liability intimated under Section 73(5)/74(5) – reg.

Please refer to Intimation ID…………… in respect of Case ID……………….vide
which the liability of tax payable as ascertained under section 73(5) / 74(5) was
intimated.
In this regard,
A. this is to inform that the said liability is discharged partially to the extent of Rs.
…………… through …………………..and the submissions regarding remaining
liability are attached / given below:

OR

B. the said liability is not acceptable and the submissions in this regard are attached
/ given below:

Authorised Signatory
Name……………………………
GSTIN……………………………
Address…………………………
Upload Attachment”.

[F. No. 20/06/07/2019-GST]

(Ruchi Bisht)
Under Secretary to the Government of India
Note: The principal rules were published in the Gazette of India, Extraordinary, Part II, Section
3, Sub-section (i) vide notification No. 3/2017-Central Tax, dated the 19th June, 2017, published
vide number G.S.R. 610 (E), dated the 19th June, 2017 and last amended vide notification No.
33/2019 – Central Tax, dated the 18th July, 2019, published vide number G.S.R. 513 (E), dated
the 18th July, 2019.

1 Income Tax

2 Goods & Service Tax (GST)

3 International Taxation

4 Company Law

Income Tax
Extension of Due Date from 30th September 2019 to 31st October 2019
The ‘due-date’ for filing income-tax returns for Assessment-Year 2019-20 is 30.09.2019 for assessees covered
under clause(a) of Explanation 2 to sub-section(l) of section 139 of the Income tax Act,1961(’Act’). It has been
represented that some of the taxpayers are facing difficulties in filing their reports of audit and income- tax
returns due to various reasons including availability of limited me with tax professionals for completion of
audits, floods in certain parts of the country etc.
On due consideration of representations from various stakeholders for extending the due date, being 30th
September,2019 , for filing of income-tax returns and various reports of audit pertaining to assessment year
2019-20 for assessees’ covered under clause (a) of Explanation 2 to section 139(1) of the Act read with relevant
provisions of the Act and Income-tax Rules, the Central Board of Direct Taxes, in exercise of its powers
conferred under section 119 of the Act, hereby extends the ‘due-date’, for filing income-tax returns as well as
all reports of audit (which are required to be filed by the said specified due date), from 30th September, 2019
to 31st October, 2019 . However, there shall be no extension of the due date for purpose of Explanation 1 to
section 234A (interest for defaults in furnishing return) of the Act and the assessee shall remain liable for
payment of interest as per provisions of section 234A of the Act.
https://www.incometaxindiaefiling.gov.in/eFiling/Portal/StaticPDF_News/Order-under-Section-119-of-the-ITAct-1961-Extension-
of-due-date.pdf
PAN Allotment statistics: PAN Allotments statistics released by Income Tax Department:
TAXPAYERS STATUS PAN ALLOTMENT UP TO 31/03/2019 PERCENTAGE
ASSOCIATION OF PERSONS 12,11,226 0.27
BODY OF INDIVIDUALS 73,074 0.02
COMPANY 17,41,192 0.39
FIRM 44,32,922 0.99
GOVERNMENT 28,205 0.01
HINDU UNDIVIDED FAMILY 20,20,148 0.45
ARTIFICIAL JURIDICAL PERSON 37,248 0.01
LOCAL AUTHORITY 77,193 0.02
INDIVIDUALS 43,52,48,341 97.65
TRUST 8,47,834 0.19
TOTAL 44,57,17,383 100.00
Up to 31.03.2019 total 24,90,68,879 PANs have been linked with the Aadhar.
CBDT excludes Bogus Penny Stocks Scam cases from benefit of Low-Tax Effect circular
The CBDT has vide Circular No. 23 of 2019 dated 6th September 2019 stated that cases where organized tax
evasion scam is noticed through bogus Long-Term Capital Gain (LTCG)/Short Term Capital Loss (STCL) on penny
stocks will be excluded from the benefit of the enhanced monetary limits stipulated in Circular no. 17 of 2019
dated 08.08.2019. The CBDT may by way of special order direct filing of appeal on merit in cases involved in
organized tax evasion activity.
(http://itatonline.org)

Prosecution of Offenses: CBDT fulfils PM’s promise & spares petty offenders from prosecution
The CBDT has vide Circular No. 24/2019 dated 09.09.2019 specified the procedure for identification and
processing of cases for prosecution under Direct Tax Laws. The CBDT has specified detailed criteria to ensure
that only deserving cases get prosecuted. The objective is to ensure that while habitual defaulters are not
spared, casual offenders where the amounts involved is less than Rs. 25 lakhs are not harassed.
This fulfills the promise made by the Hon’ble Prime Minister that the Revenue Secretary would come up with
measures to ensure that honest taxpayers are not harassed and those who commit minor or procedural
violations are not subjected to disproportionate or excessive action
(http://itatonline.org)

GST (Goods & Service Tax)

Key recommendations in GST Council 37th meeting held on September 20, 2019
 Waiver of requirement of filing Form GSTR-9A for composition taxpayers for FY 2017-18 and FY 2018-19.
 Filing of Form GSTR-9 for taxpayers having an aggregate turnover up to INR 2 crore made optional for FY
201718 and FY 2018-19.
 Extension of the last date for filing of appeals against orders of Appellate Authority before the GST
Appellate Tribunal as the Appellate Tribunals are yet not functional.
 New return system now to be introduced from April 2020 (earlier proposed from October 2019) in order
to give ample opportunity to the taxpayers as well as the system to adapt and accordingly specify the
due date for furnishing of return in Form GSTR-3B and details of outward supplies in Form GSTR-1 for
the period October 2019 – March 2020
 Linking of Aadhaar with the registration of taxpayers under GST, and examination of the possibility of
making Aadhaar mandatory for claiming refunds.
 Recommended changes in the GST rates for certain goods and services
Eligibility to file a refund application in FORM GST RFD-01 for a period and category under which a NIL refund
application has already been filed
Whenever a registered person proceeds to claim refund in FORM GST RFD-01A/RFD-01 under a category for a
particular period on the common portal, the system pops up a message box asking whether he wants to apply
for ‘NIL’ refund for the selected period. This is to ensure that all refund applications under a particular category
are filed chronologically. However, certain registered persons may have inadvertently opted for filing of ‘NIL’
refund. Once a ‘NIL’ refund claim has been filed for a period under a particular category, the common portal
does not allow the registered person to re-file the refund claim for that period under the said category.
It is now clarified that a registered person who has filed a NIL refund claim in FORM GST RFD-01A/RFD-01 for a
given period under a particular category, may again apply for refund for the said period under the same
category only if he satisfies the following two conditions:
 The registered person must have filed a NIL refund claim in FORM GST RFD-01A/RFD-01 for a certain
period under a particular category; and
 No refund claims in FORM GST RFD-01A/RFD-01 must have been filed by the registered person under
the same category for any subsequent period.
It may be noted that condition (b) shall apply only for refund claims falling under the following categories:
 Refund of unutilized input tax credit (ITC) on account of exports without payment of tax;
 Refund of unutilized ITC on account of accumulation due to inverted tax structure;
 Refund of unutilized ITC on account of supplies made to SEZ Unit/SEZ Developer without payment of
tax; In all other cases, registered persons shall be allowed to re-apply even if the condition (b) is not
satisfied.
[Circular No. 110/29/2019 – GST dated 3rd October, 2019]

Clarifications on procedure to claim refund in FORM GST RFD-01 subsequent to favorable order in appeal or
any other forum

In case a favorable order is received by a registered person in appeal or in any other forum in respect of a
refund claim rejected through issuance of an order in FORM GST RFD-06, the registered person would file a
fresh refund application under the category “Refund on account of assessment/provisional
assessment/appeal/any other order” claiming refund of the amount allowed in appeal or any other forum.
Since the amount debited, if any, at the me of filing of the refund application was not re-credited, the
registered person shall not be required to debit the said amount again from his electronic credit ledger at the
me of filing of the fresh refund application under the category “Refund on account of assessment/provisional
assessment/appeal/any other order”. The registered person shall be required to give details of the type of the
Order (appeal/any other order), Order No., Order date and the Order Issuing Authority. The registered person
would also be required to upload a copy of the order of the Appellate or other authority, copy of the refund
rejection order in FORM GST RFD 06 issued by the proper officer or such other order against which appeal has
been preferred and other related documents.
Upon receipt of the application for refund under the category “Refund on account of assessment/provisional
assessment/appeal/any other order” the proper officer would sanction the amount of refund as allowed in
appeal or in subsequent forum which was originally rejected and shall make an order in FORM GST RFD 06 and
issue payment order in FORM GST RFD 05 accordingly. The proper officer disposing the application for refund
under the category “Refund on account of assessment/provisional assessment/appeal/any other order” shall
also ensure re- credit of any amount which remains rejected in the order of the appellate (or any other
authority).
[Circular No. 111/30/2019 – GST dated 3rd October, 2019]

International Taxation

Japan Publishes Synthesized Text of Tax Treaty with India as Impacted by the BEPS MLI
Japan &’s Ministry of Finance has recently published the synthesized text of the 1989 India-Japan income tax
treaty as impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base
Erosion and Profit Shifting (MLI). A summary of the application of the MLI has also been published. The
synthesized text was prepared on the basis of the reservations and notifications submitted to the Depositary
(the Secretary-General of the Organization for Economic Co-operation and Development) by Japan on 26
September 2018 and by India on 25 June 2019 respectively. It is solely for the purpose of facilitating the
understanding of the application of the MLI to the treaty and does not constitute a source of law.
The MLI is in force for Japan on 1 January 2019 and for India on 1 October 2019 and has effect:
in Japan:
• with respect to taxes withheld at source on amounts paid or credited to non-residents, where the event
giving rise to such taxes occurs on or after 1 January 2020; and
• with respect to all other taxes levied by Japan, for taxes levied with respect to taxable periods beginning on or
after 1 April 2020; and
in India:
 with respect to taxes withheld at source on amounts paid or credited to non-residents, where the event giving
rise to such taxes occurs on or after the first day of the next taxable period that begins on or after 1 October
2019 (generally 1 April 2020); and
• with respect to all other taxes levied by India, for taxes levied with respect to taxable periods beginning on or
after 1 April 2020.
Considering the changes brought hereunder in the India-Japan Tax Treaty, it is pertinent to have a relook of the
arrangements / dealings between Indian and Japanese entities to avoid tax litigations in future.
(for more details refer: https://www.mof.go.jp/english/tax_policy/tax_conventions/mli.htm)

Company Law

Extension of due date for filing form DIR–3 KYC without payment of fees
Original due date:
Form DIR-3 KYC was required to be filed by September 30, 2019.
Extension-
The last date for filing Form DIR-3 KYC WEB has been extended to 14th October, 2019 by the Ministry of
Corporate Affairs without payment of fees.
http://www.mca.gov.in/Ministry/pdf/Companies (Appointment and Qualification of Directors) 4th Amendment Rules, 2019.pdf
http://www.mca.gov.in/Ministry/pdf/The Companies (Registration Offices and Fees) 5th Amendment Rules, 2019.pdf
Relaxation of additional fees and extension of last date of filling of BEN-2 and BEN-1 under the Companies
Act,2013
Original due date:
Form BEN-2 along was required to be filed by September 30, 2019.
Extension
the Ministry of Corporate affairs have extended the due date of filing Form BEN -2 up to December 31, 2019
without payment of additional fees. Consequent to the extension in the date of filling of form BEN-2, the date
of filling of form BEN-1 may be construed accordingly.
http://www.mca.gov.in/Ministry/pdf/GeneralCircular_24092019.pdf
The National Financial Reporting Authority (NFRA) Amendment Rules, 2019
Original Rules
The National Financial Reporti0ng Authority Rules, 2018
Effective Date of Amendment:
05th September, 2019
Amendment
Changes were made in the definitions, provisions related to the Annual Return and that of the Disciplinary
proceedings.
Rule 5- Annual Return in Form NFRA-2 which was required to be filed by 30 th April every year is now amended
to be filed by 30th November every year.
Rule 11, sub-rule (5) is amended as below
Disciplinary proceedings, where the disposal does not take place within the period of 90 days of the
assignment, the division shall record the reasons for not disposing off the show cause notice within the said
period and the chairperson, may, after taking into account the reasons so recorded, extend the aforesaid
period by such additional period not exceeding ninety days as he may consider necessary. The Chairperson
may, if he thinks fit, grant the said extension of period more than once.
http://www.mca.gov.in/National Financial Reporting Authority (NFRA) Amendment Rules, 2019.pdf
Constitution of the Company Law Committee dated 18th September, 2019

A Committee to review the offences under the Companies Act, 2013 was constituted vide order no. 2/1/2018-
CL-V dated 13.07.2018. The report, submitted to the Honorable Corporate Affairs Minister dated 27.08.2018
made recommendations for re-categorizing of certain offences into civil wrongs, de-clogging the NCLT and also
touched upon certain essential elements of corporate governance. On the basis of recommendations made by
such committee and passage of the Companies (Amendment) Act, 2019, relevant changes have been made to
the Companies Act, 2013.

1. Admissibilitv of the Application

1.1 The Applicant is stated to be engaged in the business of printing of trade advertisement
material. lt prints the content provided by the recipient on the base of polyvinyl chloride cloth,
paper etc. The Applicant provides the printing ink and the base material. lt seeks a ruling on
whether such printing is a supply of goods or service. The Applicant further wants to know the
classification of the trade advertisement material if its transaction is a supply of goods.
1.2The questions raised are admissible for advance ruling under section 97(2)(a) & (g) of the
GST Act.
1.3 The Applicant declares that the issues raised in the Application are not pending nor
decided in any proceedings under any provisions of the GST Act. The officer concerned from
the revenue has not objected to the admission of the application. The Application is, therefore,
admitted.

2. Submissions of the Applicant

2.1The Applicant prints billboards, building wraps, fleet graphics, window graphics, trade show
graphics, office branding, in-store branding, banners, signage graphics etc. The recipient
provides on a digital media the content in the form of image/text/trade monogram. The
Applicant loads the content in a digital image printer, prints the image on the PVC material,
and supplies the printed material.
2.2 Fhe Applicant submits that treatment of the above transaction varied from state to state
under the pre-GST regime. ln some states, including West Bengal, it was treated as works
contract, while some other states considered it a sale as defined under the Sale of Goods Act,
1930. The Applicant did not charge any service tax even where the transaction was treated as
works contract. According to the Applicant, the traded advertisements were manufactured
goods classifiable under heading 4911 of the Central Excise Tariff Act, 1985 (hereinafter the
1985 Act).
2.3 The Applicant argues that ‘service’, as defined under section 2(102) of the GST Act,
includes the residual transactions that cannot be treated as supply of goods, money or
securities. lt means, leaving aside money and securities, every transaction should first be
examined on the yardstick of ‘goods’, as defined under section 2(52) of the GST Act. lf it fails
the test, the transaction may qualify as a supply of ‘service’. The essential condition to classify
anything as ‘goods’ is that it should be a movable property and Printed trade advertising
material, being a movable property, is to be treated as ‘goods’. The Applicant argues that it is
transferring the title to the goods as printed advertising material. The transaction, therefore,
amounts to the supply of goods.
2.4The Applicant admits that printed advertising material is a composite supply. lt includes the
supply of goods in the form of printed PVC material and supply of the service of printing the
content provided by the recipient. The question of what constitutes the predominant element of
the composite supply, however, according to the Applicant, should be derived from the specific
terms and conditions of the contract [in support of this line of reasoning the Applicant refers to
several judgments of the apex court, notably Associated Hotels (1972) 1 SCC 472, Variely
Body Builders (1976) 3 SCC 500 and Kone Elevators (2014) 304 ELT 0161 (SC)].
2.5 The scope of work, as evident from the recipient’s purchase orders, has always been
supplying the trade advertisement material, which includes both the PVC material and printing.
Together they constitute one unified economic supply of trade advertisement. ln common
parlance also the supply is known as trade advertisement like Billboard Printing, Building
Wraps, Window Graphics, Signage Graphics, Free Standing Display Unit etc. The sole
intention of the recipient is, therefore, procuring the goods in the form of trade advertisement
rather than printing services per se. Had he wanted to avail printing services, the recipient
would have purchased the blank PVC material from other sources and provided it to the
Applicant for printing. lnstead, the recipient places an order for the composite supply of the
trade advertisement material. lt establishes that the recipient intends to receive the goods in
the form of trade advertisement. Supply of goods, therefore, constitutes the predominant
element of the composite supply.

2.6 The Applicant further argues that the element of printing is ancillary to the supply of goods
in the form of trade advertisement. The Applicant merely loads the content in the digital image
printer, which does not involve any special skill or artwork.
2.7 lhe Applicant, therefore, concludes that the principal supply is ‘goods’ in the form of trade
advertisements [in its support the Applicant refers to Harrier LLC (2011) UKFTT 725 (TC) and
the advance ruling by AAR, Telengana in K L Hi-Tech Secure Print Ltd (2018) 1O TMt 44SI.
2.8 The Applicant further argues that the printed trade advertisements are excluded from
Chapter 39 of the Customs Tariff Act, 1975 (hereinafter the Tariff Act) by virtue of Section Note
2 to Section Vll [Explanatory Notes (iii) and (iv) to Notification No. 1/2011 – CT (Rate) dated
2810612017 align the GST Act with the Tariff Act for classification)1. The said note specificaily
provides that if the plastic material is printed with motif, character or pictorial representation
which are not merely incidental to the primary use of the goods, the printed plastic material will
fall under Chapter 49.
2’9 The Applicant refers to Chapter Note 5 to Chapter 49, which states that subject to Note 3
to that Chapter, heading 4901 does not cover publications which are essentially devoted to
advertising. Such publications are to be classified in heading 4g11. Moreover, heading 4911
specifically includes trade advertising material [in its support, the Applicant relies on Holostick
lndia Ltd 2015 (318) ELT 529 (SC), Classic Strips Pvt Ltd 2015 (318) ELT 20 (SC), Fitrite
Packers 2015 (324) ELT 625 (SC), and the advance ruling of AAR, Telengana in Macro Media
Digital lmaging Pvt Ltd (2018) O TMt 5191.

3. Observation & Findinqs of the Authoritv

3.1 There is no dispute that the Applicant’s supply is a composite contract – a transaction
involving both services and transfer of property in goods, and the two are inseparable in the
execution of the contract. lt was a works contract in terms of section 2(ST)@;) of the West
Bengal Value Added Tax Act, 2003. The legal fiction created by insertion’of
‘Art
366(29A)
through the 46th Amendment of the Constitution enabled the State Government to split up such
contracts into a contract for the sale of goods and a service contract, and levy VAT on the sale
of goods.
3.2 Works contract, as defined in 2(119) of the GST Act, excludes from its ambit all such
composite contracts that do not involve buildlng, construction, repair, alteration etc. of any
immovable property. Under the GST Act, therefore, the Applicant’s supply is no longer worki
contract, or, for that^ matter, any other composite contract to which Art 366(29A; of tne
Constitution applies. Composite contracts that are not covered by Art 366(29A) cannoi be split
up for taxation into a service contract and a contract for the supply of goods unless the transaction represents two distinct and separate contracts that are diicernible as such. The
test, therefore, for all such contracts is whether the parties have in mind or intend separate
rights arising out of the supply of goods. lt is to be ascertained from the substance of the
contract. ln Bharat Sanchar Nigam Ltd [(2006)3SCC1] the apex court has calted it ‘the
dominant nature test.’
3.3 ln the GST Act, such indivisible composite contracts are termed composite supply. The
predominant element of it constitutes the principal supply, and the entire contract is treated as that of the principal supply. The Applicant admits that printed advertising material is a
composite supply. lt includes the supply of goods in the form of printed PVC material and of

the service of printing the content provided by the recipient. The substance of the contract, the
Applicant argues, is the supply of the printed PVC material. The service of printing is ancillary
and merely enhances the value of the advertising material.
3.4 ln its Circular No. 11111l2017-GST dated20l1Ol2O17, the CBIC clarifies the treatment of
various composite printing contracts. ln all these contracts, the recipient provides the content
for printing and the printer supplier the physical inputs. All the printed goods are classifiable
under Chapters 48 and 49 of the Tariff Act. The difference, however, lies in the customer
contemplating or not separate rights and use arising out of the supply of the goods. ln the case of printing of books, pamphlets, annual reports, etc., the goods have no-better utility than
carrying the printed matter. On the other hand, envelopes, letter cards, napkins, wallpapbr and
the like have separate use as goods apart from carrying the design or logo printed thereon.
The service of printing is, therefore, the predominant element in the contracts for printing of
books, pamphlets, annual reports etc., whereas, the supply of goods is the dominant nature of
the latter category of printing contracts.
3.5 The Applicant prints billboards, building wraps, fleet graphics, window graphics, trade show
graphics, office branding, in-store branding, banners, signage graphics etc., commonly known
as trade advertising material, classified under heading 4911 of the Tariff Act. The iecipient
provides on a digital media the content in the form of image/texUtrade monogram and retains
usage right on such intangible inputs. The Applicant loads the content in a digital image printer,
prints the image on the PVC material, and supplies the printed material. The goods so supplied
have no utility other than displaying the printed content. Service of printing, therefore, is the
predominant element of the composite supplies the Applicant is making.
3.6 Services by way of printing of the goods falling under Chapter 48 and 4g are classifiable
under SAC 9989 and taxable under Sl No. 27(i) of Notification No. 11t2O17 – CT (Rate) dated
2810612017 (corresponding State Notification No. 1’135 – FT dated 28106/2017). The npflicani, being
a printer of trade advertising material classifiable under heading 4g11 of the Tariff Act, is
making a composite supply, where the service of printing classifiable as above, is the principal
supply. The goods supplied, having no use other than displaying the printed matter, is ancillary
to the principal supply of printing.
3.7 The Applicant has referred to severaljudgments of the apex court and the tribunal. They
are all related to the question of classifying the goods being supplied, whether they are to be
classified under Chapter 39 or 49 of the Tariff Act. This Authority does not dispute that the goods supplied are classifiable under Chapter 49. But such supplies are ancillary to the
principal supply of printing service.
Based on the above discussion, we rule as under
RULING

The Applicant is making a composite supply, where the service of printing is the principal
supply. The goods supplied, having no use other than displaying the printed matter, is ancillary
to the principal supply of printing.
This Ruling is valid subject to the provisions
under Section 104(1 ) of the GST Act.
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(S USM ITA BHATTAC HARYA)
Member

West Bengal Authority for Advance Ruling

under Section 103 until and unless declared void
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(PARTHASARATHI DEY)
Member

West Bengal Authority for Advance Ruling

 

 

Following are the major amendments which have been notified on 9th October 2019:

ITC eligibility as per Form GSTR 2A

➢ Input tax credit eligible for a registered person in respect of invoices not uploaded by
the supplier will not exceed 20% of the eligible credit available as per Form GSTR 2A. If
the said amount exceeds 20%, the input tax credit will be restricted to 20% of the amount
uploaded by the supplier as per Form GSTR 2A.

GSTR 3B – a return under Section 39 retrospectively

➢ An amendment has been made to provide retrospectively with effect from 1st October
2019 that Form GSTR 3B will be considered as a return under Section 39. This is to
circumvent the decision of Gujarat High Court in the case of AAP and Associates.

Consolidated payment advice for refund

➢ With effect from 24th September 2019, the concept of consolidated payment advice
has been inserted in case of refund to ensure single window disbursal of refund.

Suspension of Registration

➢ It has been clarified that after suspension of registration but before its cancellation,
the registered person is not liable to issue a tax invoice and accordingly not charge tax. In
case of the revocation of the said cancellation, the provisions for issuance of revised tax
invoice with GST and its disclosure in the next return as applicable in case of new
registration will apply.

Form GST TRAN-1 and TRAN-2 extension in selective cases

➢ An enabling provision has been given to provide that wherein technical difficulties are
there and the Council recommends for extension, the time limit for Form GST TRAN 1 and
TRAN 2 can be extended up to 31st December 2019 and 31st January 2020 respectively.

Communication of demand before service of SCN

➢ Part A of the Form GST DRC-01A has been provided for communication by the proper
officer of the demand before service of show cause notice. Further, the submission by the
assessee against the proposed liability has been provided has been provided in Part B of
the Form GST DRC-01A.
Annual Return Filing made optional for small taxpayers for 2017-18 and 2018-19
➢ Seeks to make filing of annual return under section 44 (1) of CGST Act for F.Y. 2017- 18
and 2018-19 optional for small taxpayers whose aggregate turnover is less than Rs 2
crores and who have not filed the said return before the due date.
Due dates prescribed for GSTR 3B and GSTR 1 for October 2019 to March 2020
➢ Due date for Form GSTR 3B will continue to be 20th of the next month for the period
October 2019 to March 2020.
➢ For the persons having aggregate turnover of less than Rs. 1.5 crores in the preceding
financial year and opting to file quarterly return will continue to have their due date by
the end of the month following the quarter i.e.

o October 2019 to December 2019 – 31st January 2020
o January 2020 to March 2020 – 30th April 2020

➢ For other taxpayers opting to file monthly GSTR 1 returns will have the due date as
11th day of the succeeding month.