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February 1, 2022

Unannounced GST Amendment in Budget Speech 2022 mentioned in Finance Bill

by CA Shivam Jaiswal in GST

Unannounced GST Amendment in Budget Speech 2022 mentioned in Finance Bill


The Finance Minister unveiled the Budget 2022 on the 1st of February 2022 at 11.00 AM. Creation of job opportunities, Development in infrastructure, Digital currency, domestic solar power companies, Aatmanirbhar Defense, financing investments, capital expenditure, direct and indirect tax, customs, transport and education sector were some topics for budget 2022.

It will interest you to know that the January GST collection surpasses 1.4 lakh crore the highest GST collection ever. In this article we will know about the amendments in the indirect taxes pertaining to GST. The GST amendments are running from clause 99 to clause 123 of the Finance Bill 2022. These amendments will be effective from a date to be notified or otherwise specified in accordance to section 1 (2) (b) of Finance Bill 2022. Whereas, amendment pertaining section 50 will have retrospective effect as discussed in the article below.

Highlights on Changes in GST – Budget 2022

  1. Clause 99 of Finance Bill- Extension of time limit for 2 months from 30th September to 30th November for availing ITC U/s 16(4).
  2.  Clause 99 of Finance Bill- Further in accordance to section 16(2) additional condition has been implied for availing ITC i.e., ITC can now be availed only if the same is not restricted in GSTR2B. A new clause (ba) to section 16 (2) has been inserted for the same.
  3. Clause 100 of Finance Bill – Clause (b) and (c) of sub section (2) of Section 29 of CGST Act are being amendment Cancellation on suo-moto basis for defaulting taxpayers registered under composition scheme for non- filing of GSTR4 return beyond a period of 3 months from due date.
  4. Clause 101 of Finance Bill- Amendment in sub – section (2) of section 34-Further extension is granted on similar lines as that of ITC availment to issuance of credit note. Credit notes for supply can now be issued upto 30th November of next financial year instead of 30th September.
  5. Clause 102 and Clause 111 of Finance Bill – Section 37 of CGST Act Amendment- Extension from 30th September to 30th November of next financial year also implies to any rectification of error in GSTR1/ GSTR3B.
  6. Clause 102 and Clause 103 of Finance Bill- Section 37 and section 38 of CGST Act Amendment – Two- way communication process in filing GST returns is now a history as the same is scrapped.
  7. Clause 104 of Finance Bill- Section 39 of CGST Act Amendment- For non- resident taxable persons, the due date for filing return is 13th day of the following month.
  8. Clause 105 of Finance Bill- Section 41 of CGST Act Amendment In order to do away with the concept of claim of ITC on a provisional basis section 41 of CGST Act is being substituted.
  9. Clause 106 of Finance Bill- Omission of section 42,43 and 43 A of CGST Act to do away with the two-way communication process in return filing
  10. Clause 107 of Finance Bill – To provide for levy of late fee for delayed filing of TCS returns section 47 of CGST Act stands amended.
  11. Clause 108 of Finance Bill – so as to remove reference to section 38 of CGST Act section 48 of CGST Act stands amended.
  12. Clause 109 of Finance Bill – There are 3 amendments pertaining to section 49 of CGST Act. a) To provide restriction for utilizing the amount available in electronic credit ledger amendment of section 49 of CGST Act is being proposed. b) This section is also amended so as to allow transfer amount available in E- cash ledger of a registered person to the E-cash ledger of a distinct person. c) Further, to provide for prescribing the maximum proportion of output tax liability which may be discharged through the electronic credit ledger section 49 is being amended.
  13. Clause 110 of Finance Bill- Interest will not be levied if ITC is not utilized as section 50(3) of CGST Act is being substituted retrospectively with effect from 1st July 2017, so as to levy interest on input tax credit wrongly availed and utilized.
  14. Clause 112 of Finance Bill – For any balance in electronic cash ledger the refund claims will now be made available.
  15. Clause 112 of Finance Bill -Amendment in sub section (2) of section 168 of CGST Act to remove reference to section 38 of CGST Act.
  16. Clause 115, Clause 118 and Clause 121 of Finance Bill – The rate of interest u/s 50 (3) is prescribed as 18% in all cases i.e., CGST, SGST, IGST & UTGST

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