The 52nd GST Council Meeting, held on 7th October 2023, witnessed several significant
changes and recommendations aimed at enhancing the Goods and Services Tax (GST) framework in India.
Some of the key highlights are:
Narrow down the scope of Section 9(5) of CGST Act, 2017 on services of bus transportation
Council recommends, electronic commerce operators (ECOs) need not to pay GST under section 9(5) for
bus operators organized as companies. The companies (who is a transporter in this case) can pay the tax
under section 9(3) and can also avail ITC. However, for transporters who are not organized as companies
and use ECOs, the tax should be paid by the ECOs under section 9(5).
Amnesty Scheme for filing of appeals against demand orders
Taxpayers, who couldn’t file an appeal against demand orders passed under section 73 or 74 of the CGST
Act, 2017 on or before March 31, 2023, or had their appeals rejected solely due to not meeting the specified time frame requirements. Council recommends to allow such taxpayers to file an appeal under Amnesty Scheme until January 31, 2024.
However, they must fulfill the condition of making a pre-deposit of 12.5% of the disputed tax amount, out of which a minimum of 20% to be debited from their Electronic Cash Ledger.
No GST on Personal Guarantee
Personal Guarantee by a Director to the bank against loan/ credit limits obtained by company. The council
recommends, NIL taxable value of the service by a director to company is acceptable, if the company does not provide any form of consideration to director either directly or indirectly. Hence, no GST levy on personal guarantee.
GST on Corporate Guarantee
Council recommends the taxable value of supply of corporate guarantee provided between related parties as 1% of the amount of such guarantee offered, or the actual consideration, whichever is higher. Such tax shall be payable irrespective of the fact whether recipient is eligible for full ITC or not.
Council’s Recommendation to Allow IGST Refund Route for Supplies to SEZ Units/Developers
Council recommends, to allow suppliers to make supply of goods or services (excluding specific commodities like pan masala, tobacco, etc.) to SEZ units/developers for authorized operations on payment of IGST and claim the refund of tax so paid.
Mandatory Input Service Distributor (ISD) Procedure
Council recommends, that ISD procedure made mandatory for distributing ITC in cases where Head Office
(HO) procures input services from a third party but attributable to both HO and Branch Office (BO) or
exclusively to one or more BOs.
Provisional attachment of property to automatically expired after one year with no need of any order from Commissioner.
Extra Neutral Alcohol (ENA) used for the manufacture of alcoholic liquor for human consumption to be kept outside the GST ambit. This may also attract VAT implications.
Source: 52th GST council Meeting dated 07-10-2023
