GST Amendments effective 1st February 2019

GST Amendments effective 1st February 2019

The president of India gave assent on 29th August 2018 to make amendments to following GST laws:


  1. The Central Goods and Services Tax (Amendment) Act 2018
  2. The Integrated Goods and Services Tax (Amendment) Act 2018
  3. The Union Territory Goods and Services Tax (Amendment) Act 2018
  4. The Goods and Services Tax (Compensation to States) Amendment Act 2018

The GST council in its 31st Council Meeting held on 22nd December 2018 has announced through a press release that the effective date of applicability of amendments in GST Act(s) 2018 will be from 1st February 2019.


Some of the Key Changes are:

  1. Definition of Business vertical has been omitted (Section 2(18) of CGST Act, 2017). Now, Separate Registration can be taken for the same Business Vertical within a State.
  2. Section 9(4) has been amended to provide that the reverse charge shall be applicable only on the specified class of registered persons and specified categories of goods or services or both.
  3. Upper limit of turnover for opting of composition scheme shall be raised from Rs. 1 Cr to Rs. 1.5 Crore. A Composite dealer(in goods) shall be allowed to supply services (other than restaurant services), for a value not exceeding 10% of turnover in the preceding financial year; or  Rs. 5 lakh; whichever is higher.
  4. A single Credit and Debit note can be issued for more than one tax invoice.
  5. Section 49A is inserted which prescribes the manner of utilization of ITC on account of CGST, SGST/UTGST. Under revised mechanism, the ITC of IGST, CGST and SGST respectively shall first be utilised against the liability of IGST only. Thereafter, the balance available in CGST and SGST will be utilised for liability under respective pool.
  6. An explanation has been inserted to sec. 17(5) of CGST Act, 2017 i.e. the expression ‘value of exempt supply’ shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said Schedule.
  7. Bill to – Ship To concept introduced in case of Services as well for the purpose of ITC (Explanation II of Section 16(2)(B)).
  8. In case of Detention, seizure and release of goods and conveyances in transit; period for payment of tax or penalty is increased from 7 days to 14 days.
  9. Maximum amount of pre-deposit will be Rs. 50 crore for filing an appeal and Rs. 100 crore for filing an appeal before Appellate Tribunal.
  10. Commissioner may extend the time limit for return of inputs and capital sent on job work, for a further period of 1 year and 2 years, respectively.
  11. Time limit for filing refund application will be 2 years from the due date of furnishing return u/s 39 for the relevant tax period as against the earlier provision allowing assessee to file refund application till the period of 2 years from the end of relevant FY.
  12. ITC of State Tax can only be utilized for payment of Integrated tax, when IGST and CGST are fully exhausted.
  13. Supply of services outside India shall be regarded as exports, even if payment is received in Indian Rupees, wherever permitted by RBI.
  14. Power has been conferred u/s 39(9) to allow rectification in previously filed returns in a manner to be prescribed. This rectification would be possible before filing of return for September month of Next financial year or filing of Annual Return.
  15. Section 43 has been amended and section 43A has been introduced in order to implement new return filing mechanism, which may be functional on trial basis w.e.f. 1st April, 2019 and mandatory w.e.f. 1st July, 2019 as per the recent press release in this regard. Under new Provision Supplier and Recipient are made jointly and severally liable for the payment of GST.
  16. Recovery of taxes, interest, fine, penalty etc. can be made from distinct persons, even if such distinct persons are present in different State/Union territories.
  17. Exemption from compulsory GST registration for e-commerce operators who are not required to collect TCS.
  18. A separation registration is required by a taxable person having units in both SEZ & non-SEZ area in same state.
  19. No Compulsory Audit for Govt.’s dept. if their books are subject to CAG audit.
  20. Import of Services to be taxable even if any person other than taxable person receives services with or without consideration.
  21. Merchanting Trade Transactions, High Sea Sale and Sale from Bonded Warehouse has been made exempt under Schedule III.
  22. ITC on motor vehicle having seating capacity of 13 or more will be available in all situations.
  23. ITC of motor vehicle having seating capacity less than 13 will be available when such motor vehicle is being used for specified purposes i.e. transportation of passengers or for further taxable supply or for training on driving such vehicle. ITC of Vessels and Aircraft would be available only if they are used for specified purposes.
  24. ITC on General insurance, repair & maintenance will be available if the ITC as per above is available. Therefore, now the ITC on general repair & maintenance will not be available on such motor vehicles for which ITC is not available.
  25. ITC on food and beverages, health services and travel benefit extended to the employees, rent a cab service will be available where it is obligatory for the employer to provide the same to its employees under any law for the time being in force.
  26. ITC of life insurance and health insurance and food/beverages will be available, if it is further used in making taxable outward supplies.


Clarificatory Amendments applicable retrospectively:


  1. Definition of Service amended to include facilitating or arranging transaction in securities.
  2. Reference to Schedule II has been removed from the definition of Supply. (Section 7(1))
  3. Sec 140(1) of CGST Act, 2017 has been amended for disallowing the credit of Krishi Kalyan Cess or other cess outrightly.


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