Minimum Wages of Labour in Punjab wef 01/03/2019

GST Provisions on Cash Discount/Trade Discount/Early Payment Discount

1. I am giving Discount to my customer if he makes payment within fixed days.

    A. Whether it is necessary to issue Credit Notes and To Reverse GST----------No.

    B. If I issue credit notes and reverse/pay GST whether my customer will get Input credit-Yes.

First here see relevant section

Section 15(3) of CGST Act read as under:-

(3) The value of the supply shall not include any discount which is given–– 

(a) before or at the time of the supply if such discount has been duly recorded inthe invoice issued in respect of such supply; and 

(b) after the supply has been effected, if—(i) such discount is established in terms of an agreement entered into at or before the time of such supply and specifically linked to relevant invoices; and 

(ii) input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply..

Opinion:- In this section it is provided that the Discount can be deducted from Value of the goods and it is not mandatory to pay GST on Discount. BUT IT DOES NOT MEAN THAT IF GST HAS BEEN PAID OF DISCOUNT IT IS MANDATORY TO REVERSE AT THE TIME OF GIVING DISCOUNT

Now here is a circular No. 92/11/2019 dated 07/03/2019. The relevant portion of the circular is as under:-

D Secondary Discounts. 

i These are the discounts which are not known at the time of supply or are offered after the supply is already over. For example, M/s A supplies 10000 packets of disccounts to M/s B at Rs. 10/-per packet. Afterwards M/s A re-values it at Rs. 9/-per packet. Subsequently, M/s A issues credit note to M/s B for Rs. 1/-per packet.

 ii.The provisions of sub-section (1) of section 34 of the said Act provides as under:  

      “Where one or more tax invoices have been issued for supply of any goods or services or both and the    taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient one or more credit notes for supplies made in a financial year containing such particulars as may be prescribed".

 iii.     Representations have been received from the trade and industry that whether credit notes(s) under sub-section (1) of section 34 of the said Act can be issued in such cases even if the conditions laid down in clause (b) of sub-section (3) of section 15 of the said Act are not satisfied. It is hereby clarified that financial / commercial credit note(s) can be issued by the supplier even if the conditions mentioned in clause (b) of sub-section (3) of section 15 of the said Act are not satisfied. In other words, credit note(s) can be issued as a commercial transaction between the two contracting parties.

 iv.  It is further clarified that such secondary discounts shall not be excluded while determining the value of supply as such discounts are not known at the time of supply and the conditions laid down in clause (b) of sub-section (3) of section 15 of the said Act are not satisfied. 

v.       In other words, value of supply shall not include any discount by way of issuance of credit note(s) as explained above in para 2 (D)(iii) or by any other means, except in cases where the provisions contained in clause (b) of sub-section (3) of section 15 of the said Act are satisfied. 

vi.    There is no impact on availability or otherwise of ITC in the hands of supplier in this case 

OPINION :- In this circular it has been clarified ALSO that there is no mandatory to issue credit notes when after sales discounts are provided . Circular say Credit CAN BE issued not say Credit Not WILL be issued. Even if Credit Notes to be issued conditions of section 15(3)(b) to to be fullfilled i.e. there should be a written agreement befween supplier and purchaser that this discount will be provided.

GST Provisions on Transfer /Change of Constitution Proprietor to partnership to Proprietor Input Tax Laibility

If a proprietorship business had added partner and in two partnership business one partner retired then these circumstances Existing registration is to be surrendered and new registration is to be obtained.

Input Tax Credit and Tax Liability on change of contitution

Section 18(3) of CGST Act states as under:-

(3) Where there is a change in the constitution of a registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said registered person shall be allowed to transfer the input tax credit which remains unutilised in his electronic credit ledger to such sold, merged, demerged, amalgamated, leased or transferred business in such manner as may be prescribed.

Rules 41 of CGST Rules states as under:-

Transfer of credit on sale, merger, amalgamation, lease or transfer of a business.-
 (1) A registered person shall, in the event of sale, merger, de-merger, amalgamation, lease or transfer or change in the ownership of business for any reason, furnish the details of sale, merger, de-merger, amalgamation, lease or transfer of business, in FORM GST ITC-02, electronically on the common portal along with a request for transfer of unutilized input tax credit lying in his electronic credit ledger to the transferee: Provided that in the case of demerger, the input tax credit shall be apportioned in the ratio of the value of assets of the new units as specified in the demerger scheme.

(2) The transferor shall also submit a copy of a certificate issued by a practicing chartered accountant or cost accountant certifying that the sale, merger, de-merger, amalgamation, lease or transfer of business has been done with a specific provision for the transfer of liabilities.

 (3) The transferee shall, on the common portal, accept the details so furnished by the transferor and, upon such acceptance, the un-utilized credit specified in FORM GST ITC-02 shall be credited to his electronic credit ledger.

(4) The inputs and capital goods so transferred shall be duly accounted for by the transferee in his books of account.

PSDT Tax Due Date of Payment and other provisions

What is the due date of Payment under PSDT Tax (Punjab)

1. Section 6(3) of the Act read as under:- (Applicable to Non Salaried Persons)

    "The designated officer shall mention in every certificate of enrolment the amount of tax payable by the holder according to the Schedule and the date by which it shall be paid, and such certificate shall be deemed to be a notice of demand for the purposes of section 12"


2.  Section 10(2) and (3) are as under:-

   (2) The amount of tax due from the employers liable to deduct the tax from employees shall be paid every month within the prescribed time and in the prescribed manner.
   (3)The amount of tax due from enrolled persons for each year as specified in their enrolment certificate shall be paid within one month from the end of the month of enrolment.

3 Rules 12(1) and (2) are as under:-


      (1) Every employer, other than an officer of the Central Government or a State Government responsible for deduction of the due amount of tax from the salary or wages of the employees as defined in clause (e) of Section 2, shall deduct every quarter from the salaries or wages payable to the employees, an amount specified in the Schedule.(2) In the case of the employees of the Central Government or a State Government, the drawing and disbursing officer shall be responsible for thededuction of the amount of tax payable from the salaries or wages of the employees as defined in clause (e) of Section  

   2. The deduction shall be made every quarter from the salaries or wages payable to the employees and the amount of tax to be so deducted in each quarter, shall be equal to the amount specified in the Schedule.

RESULTS: Enrollment certificate do not contains date of payment (As provided under section 6(3). 
Section 10(2) say tax to be paid every month But Rule 12(1) (2) say tax from employees shall be deducted every quarter.
SO NO ANY LAST DATE for PAYMENT OF TAX under PSDT is prescribed

Input Tax Credit ITS Utilization wef 1/2/2019

Amendment for utilization of IGST-CGST-SGST with effect from 1/2/2019

Old Section 49(5)c

c) The State Tax shall first be utilised towards payment of State Tax and the amount remaining, if any, may be utilised towards payment of Integrated Tax

Additions wef 1/2/2019

“Provided that the input tax credit on account of State tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax;”;

EFFFECT AMENDMENT IS TO MAKE PROVISIONS ACCORDING TO SYSTEM ALREADY DOING

Provisions Before Amendment  the assessee can do but system is not doing

                                                                        IGST                               CGST                     SGST

                                Credit Available                       0.00                        15000                    6000

IGST  (Due 16000)                                                                                 10000                    6000

CGST (Due 0 )

SGST (Due 0)

After amendment (System already doing this)

                                                                        IGST              CGST                    SGST

                                Credit Available             0.00                 15000                    6000

IGST  (Due 16000)                                                               15000                    1000

CGST (Due 0 )

SGST (Due 0)

Notwithstanding anything contained in section 49, the input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment.

(Important wordiong is “Not withstanding containedin Section 49) meaning Section 49A will be supreme over section 49)

Next important word is FULLY utilized not FIRST utilized

EFFECT OF AMENDEMENT

BEFORE AMENDMENT

                                                            IGST      CGST         SGST       TOTAL

CREDIT AVAILABLE                       55000   20000          20000         95000

IGST (25000)                                      25000                                           25000

CGST (15000)                                                  15000                               15000

SGST (15000)                                                                      15000           15000

CLOSING BALANCE                       30000    5000            5000           40000

AFTER AMENDMENT

                                                            IGST        CGST       SGST            TOTAL

CREDIT AVAILABLE                       55000     20000         20000             95000

IGST (25000)                                       25000                                              25000

CGST (15000)                                      15000                                             15000

SGST (15000)                                     15000                                              15000

CLOSING BALANCE                            0      20000           20000           40000

Deduction from Salary of Punjab State Development Tax (Professional Tax)

Can assessee deduct amount of Punjab State Development Tax (Professional Tax) from Income From Salary------Yes

The provisions of Section 16
which read as under:-

The income chargeable under the head "Salaries" shall be computed after making the following deductions, namely :—

  (i) [***]

Following clause (ia) shall be inserted after clause (i) of section 16 by the Finance Act, 2018, w.e.f. 1-4-2019 :

(ia) a deduction of forty thousand rupees or the amount of the salary, whichever is less;

 (ii) a deduction in respect of any allowance in the nature of an entertainment allowance specifically granted by an employer to the assessee who is in receipt of a salary from the Government, a sum equal to one-fifth of his salary (exclusive of any allowance, benefit or other perquisite) or five thousand rupees, whichever is less;

(iii) a deduction of any sum paid by the assessee on account of a tax on employment within the meaning of clause (2) of article 276 of the Constitution, leviable by or under any law.

(iv) [***]

Punjab State Development Tax is incorporated under the provisions of clause (2) of Article 276 of Constitution by Punjab State Government.

So any tax paid under the act is eligible to deduction under section 16(iii) of Income Tax Act

As the act is applicable with effect from 19 Aptil 2018 to for the month of April Rs. 80 then Rs. 200 per month (Total 2280 for the year 2018-19) can be claimed  as deduction from Salary

 

Micro Small and Medium Classification as per MSME Act/Notification

Investment in Plant and Machinery/Equipment (Rs)

	Manufacturing Sector	Service Sector
Micro	Upto 25 Lakh	Upto 10 Lakh
Small	>25 Lakh upto 5 crore	>10 Lakh upto 2 crore
Medium	>5 Crore upto 10 crore	>2 crore upto 5 crore

Notification SO 1642E dated 29.09.2006
Copy paste in browser as under
http://dcmsme.gov.in/publications/circulars/GazNot/Recommendation_of_Advisory_Committee.pdf

HSN Code Rolling Mills and Parts

8455          Rolling Mills and Parts
84552110  Hot Rolling Mills
84552120  Hot and Cold Rolling Mills combined
84552200  Cold Rolling Mills
84553000  Rolls for Rolling Mills
84559000  Other Parts