During COVID-19 outbreak, first and foremost, our hearts go out to anyone impacted by the virus either directly or indirectly. Our thoughts are especially with the ones who are sick and we extend our heartfelt wishes for their speedy recovery. We are truly inspired by the selfless healthcare workers around the world who are on the front line and are working tirelessly for our well-being.

 

The Ministry of Law and Justice has recently issued the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020 (‘Ordinance’) to provide several relief measures in light of COVID-19. Further, the Central Government has issued Notifications giving effect to Press Release dated March 24, 2020 for extending due dates under GST. In parallel, Ministry of Commerce has also announced several relaxations relating to timelines prescribed under the Foreign Trade Policy, 2015-20 (‘FTP’) in light of COVID-19. We have discussed all the relevant changes in the succeeding paragraphs:

 

1. Extension of time limits under various Indirect Tax laws vide Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020

 

In terms of powers enshrined under Article 123 of the Constitution of India, the President of India has passed the Ordinance. Amendments relating to Indirect Tax laws, have been summarized below:

 

• Chapter V of the Ordinance has extended various time limits given under the Excise, Customs and Service Tax laws falling between March 20, 2020 and June 29, 2020 till June 30, 2020 for completion of following actions:

 

• Any proceeding / issuance of any order, notice, intimation, sanction, approval etc. by any Authority, Commission or Tribunal; and

 

• Any appeal, reply, application, report, document, return, statement etc. to be filed by taxpayer.

 

• The Ordinance has introduced a new Section 168A under the Central Goods and Services Tax Act, 2017 (‘CGST Act’) to empower Central Government to issue Notifications on the recommendations of the GST Council in force majeure situations like the present one which effect the implementation of the CGST Act. As per the Press Note dated March 31, 2020 the purpose of this provision and consequent Notifications is to extend various time limits provided under the CGST Act such as for filing of statement of outward supplies, refund claims, appeals etc.

 

• Chapter VI of the Ordinance has extended various time limits given under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (‘SVS’) as under:

 

S. No.	Provision	Extended due date
1.	Issuance of SVLDRS-03 where amount estimated by Designated Committee (‘DC’) equals amount declared	May 31, 2020
2.	Issuance of SVLDRS-02 where amount estimated by DC does not equal amount declared	May 1, 2020
3.	Issuance of SVLDRS-03 after giving opportunity of being heard to declarant	May 31, 2020
4.	Payment of amount mentioned in SVLDRS-03 by declarant	June 30, 2020

 

NITYA Comments:

 

Basis the above, a declarant can make payment till June 30, 2020 in the following situations:

 

1. Cases wherein SVLDRS-3 was issued and payment was not made within 30 days of issuing SVLDRS-3 provided application has not been rejected due to non-payment; and

 

1. Cases wherein SVLDRS-2 and SVLDRS-3 have not yet been issued

 

It is pertinent to note that no amendment has been made to Section 127(8) of the Finance Act, 2019 for issuance of Discharge Certificate (SVLDRS-4) by DC. Thus, DC is required to issue the same within 30 days of payment by the declarant. This time period shall be counted from the date of payment (not June 30, 2020) wherein the declarant made the payment prior to June 30, 2020.

 

1. Recent Notifications and Circulars issued under GST

 

1. Extension of time limit for filing of various returns

 

Month	Due date for Form GSTR-1	Due date for Form GSTR-3B	Date till when interest not applicable	Date till when Form GSTR-3B needs to be filed with interest of 9 percent p.a.#
February 2020	March 11, 2020	March 20, 2020	April 4, 2020	June 24, 2020*
March 2020	June 30, 2020*	April 20, 2020	May 5, 2020	June 24, 2020*
April 2020		May 20, 2020	June 4, 2020	June 24, 2020*
May 2020		June 27, 2020	NA	NA

 

* There will be no late fee if the return is filed till specified dates.

 

^#Where Form GSTR-3B is filed on or after June 25, 2020, interest of 18 percent p.a. along with late fees shall apply for the full period.

 

• Due date of all other returns like Form GSTR-6 (ISD return), Form GSTR-7 (TDS return), Form GSTR-8 (TCS return) for the months of March 2020 to May 2020 has been extended till June 30, 2020.

 

(Refer Notification No. 31/2020- Central Tax, Notification No. 32/2020- Central Tax, Notification No. 35/2020- Central Tax and Circular No. 136/06/2020, all dated April 3, 2020)

 

2. Extension of other time limits under GST law

 

• Due date of the following activities falling between March 20, 2020 to June 29, 2020 has been extended till June 30, 2020:

 

• Any proceeding / issuance of any order, notice, intimation etc. by any Authority; and

 

• Any appeal, reply, application, report, document, return, statement etc. to be filed by taxpayer.

 

Notably, the above extensions will not apply to time limit for taking registration i.e. taxpayer will continue to seek registration within 30 days from the date on which it becomes liable.

 

• Validity of an e-way bill expired or expiring between March 20, 2020 to April 15, 2020 has been extended till April 30, 2020.

 

(Refer Notification No. 35/2020-Central Tax dated April 3, 2020)

 

3. Availment of ITC not appearing in Form GSTR-2A

 

• Rule 36(4) of the Central Goods and Services Tax Rules, 2017 (‘CGST Rules’) restricts Input Tax Credit (‘ITC’) on invoices and debit notes not uploaded by suppliers to 10% of ITC on invoices and debit notes uploaded by suppliers.

 

• A proviso has been inserted in Rule 36(4) of the CGST Rules to provide that this provision shall apply cumulatively for the months February 2020 to August 2020. The cumulative effect / adjustment for these months needs to be done in Form GSTR-3B of September 2020.

 

(Refer Notification No. 30/2020- Central Tax dated April 3, 2020)

 

1. Changes regarding Customs and FTP

 

• The applicability of provisions of FTP and Handbook of Procedures 2015-2020 (‘HBP’) is extended till March 31, 2021.

 

• The time limit for filing claims for Merchandise Exports from India Scheme (‘MEIS’) for shipping bills with Let Export Order (‘LEO’) date falling between February 2019 to May 2019, can be filed within 15 months from date of respective LEO.

 

• Service Exports from India Scheme (‘SEIS’)

 

• Financial Year (‘FY’) 2018-19: SEIS claim can be filed on or before December 31, 2020;

 

• FY 2019-20: Eligible services and applicable rate of reward will be notified in future;

 

• FY 2020-21: The continuation of SEIS scheme will be notified in future.

 

NITYA Comments: It is imperative to note that time period for filing SEIS claim for FY 2016-17 has not been extended which could have been filed till March 31, 2020 with late cut. Similarly, time period for filing SEIS claim for FY 2017-18 has not been extended and higher late cut would apply when filed in current FY.

 

The Government vide Public Notice No. 7/2015-2020 dated May 11, 2018 extended benefit of SEIS scheme for notified services for FY 2018-19. The taxpayers expected continuation of this benefit in FY 2019-20 as well. However, the list of services along with rate of SEIS for FY 2019-20 will be announced later. It is expected that there may be reduction in list of services and rate of SEIS. If curtailment happens now, it will effectively have a retrospective effect. In our view, such an action can be challenged in Courts on the grounds of ‘Promissory Estoppel’.

 

Notably, in February 2020, Commerce and Industry Minister Piyush Goel announced discontinuation of SEIS scheme in future since the scheme is not resulting in significant increase in export of services. Hence, the future of SEIS scheme looks bleak for FY 2020-21.

 

• IGST exemption under Advance Authorization Scheme (‘AA’), Export Promotion Capital Goods Scheme (‘EPCG’) and for Export Oriented Units (‘EOUs’) has been extended till March 31, 2021.

 

• Where last date of undertaking following activities falls between February 2020 to July 2020, the same has been extended by 6 months:

 

• Authorization for import of goods and replenishment application under AA and EPCG;

 

• Export obligation (‘EO’) (including block-wise EO) or last date of export under AA and EPCG; and

 

• Submission of certificate of installation of capital goods under EPCG.

 

• The following extensions have been allowed to EOUs:

 

• Letter of Permission and Letter of Intent expiring on or after March 1, 2020, shall be valid till December 31, 2020;

 

• Quarterly performance report for quarter ending March 2020 and June 2020 can be filed till September 30, 2020;

 

• Annual performance report for FY 2019-20 can be filed till September 30, 2020; and

 

• Central Sales Tax refund for quarter ended September 2019 and December 2019 can be filed till September 30, 2020.

 

• Validity of all status certificates (like Star Export House certificate) has been extended till March 31, 2021.

 

(Refer Notification No. 57/2015-2020 dated March 31, 2020 and Public Notice No. 67/2015-2020 dated March 31, 2020)

 

Registration-cum-membership Certificate (‘RCMC’)

 

• Regional Authorities shall accept the application for any incentive / authorization even if RCMC expired on or before March 31, 2020. Importer / Exporter can submit valid RCMC on or before September 30, 2020.

               

(Refer Trade Notice No. 60/2019-2020 dated March 31, 2020)

 

Retrospective issuance / acceptance of Certificate of Origin certificate

 

• For exports made during lockdown period, certified agencies issuing Certificate of Origin certificates are instructed to issue certificates retrospectively.

 

• For imports, customs authorities are instructed to grant benefits under Free Trade Agreements (‘FTA’) or other agreements subject to submission of Certificate of Origin at a later date.

 

(Refer Trade Notice No. 59/2019-2020 dated March 28, 2020)

 

Relaxation in furnishing customs bond

 

• The specified category of importers and exporters (‘taxpayer’) can furnish an undertaking instead of bond due to difficulty in obtaining stamp papers. The undertaking needs to contain following:

 

• It must be similar to bond to the extent possible;

 

• It must be on letter head of the taxpayer with an acknowledgment;

 

• It must be submitted from registered e-mail id of Importer Exporter Code (‘IEC’) holder or custom broker; and

 

• It must contain a declaration to provide bond on a notarized stamp paper by May 7, 2020.

 

(Refer Circular No. 17/2020-Cus. dated April 3, 2020)

 

Relaxation in time period for realization of export proceeds

 

• RBI has extended time period for realization of export proceeds for exports made till July 31, 2020 from 9 months to 15 months from the date of export.

 

(Refer AP (DIR Series) Circular No. 27 dated April 1, 2020)

 

1. Extension for declaring revised MRP on packages under Legal Metrology law

 

• Manufacturer, Importers and Packers are allowed to declare revised Retail Sale Price / Maximum Retail Price (‘MRP’) to the extent of increase in tax burden on account of revision in rate of GST on stocks manufactured, packed and imported prior to such revision.

 

• The revised MRP can be declared on packages before September 30, 2020 or sale of such stock, whichever is earlier subject to following prescribed procedure.

 

(Refer Letter WM-10(14)/2020 dated April 4, 2020 by Legal Metrology Division, Ministry of Consumer affairs)