The Central Board of Indirect Taxes and Customs (CBIC) has revised GST regulations to include numerous anti-evasion measures, such as the disbursement of GST refunds only to the bank account linked to the same PAN used to seek GST registration. Businesses who have not filed a summary return or paid monthly GST since January 1, 2022 will not be eligible to file a GSTR-1 sales return for the subsequent month, according to the announcement. The notice is the result of decisions made during the GST Council meeting in Lucknow on 17th September 2021.
Companies would be required to link their GST registration with photographic Aadhaar in order to obtain tax refunds and seek registration or cancellation. If a company does not have an Aadhaar number, registration is approved following a physical inspection of the site, according to the notification. From January 1, 2022, businesses that do not pay monthly GST and fail to submit a summary return will be unable to file GSTR-1 sales reports for the subsequent month. The action would aid in closing loopholes and preventing revenue loss caused by GST avoidance.
Having impact from January 1, 2022, the indirect tax regime body modified Rule 59(6) of the Central GST Rules to stipulate that a registered person shall not be permitted to file Form GSTR-1 if he or she has not filed the previous month's return in Form GSTR-3B. Currently, regulations prohibit businesses from submitting a report for external supplies, or GSTR-1, if they have defaulted on their GSTR-3B for the previous two months. Businesses must submit GSTR-1 for a given month by the 11th day of the next month, and GSTR-3B, which is used to settle taxes, must be submitted between the 20th and 24th day of the following month.
GST refunds can be claimed in the following scenarios:
- Excess balance in Electronic Cash Ledger
- On Account of Export of Services -With Payment ofTax
- On Account of Supplies made to SEZ Unit/ SEZ Developer (With Payment of Tax)
- Exports of Goods / Services - Without Payment of Tax, i.e., ITC Accumulated)
- ITC Accumulated due to InvertedTax Structure (clause (ii) section 54(3))
- On account of Supplies made to SEZ Unit/ SEZ Developer (Without Payment of Tax)
- On account of Refund due to Deemed Export
- On account of Assessment /ProvisionalAssessment / Appeal
- Excess payment of tax
- Any other reason
Refunds cannot be claimed in the following scenarios
- No Refund of Unutilized ITC is allowed in cases where the Goods are exported out of India are subjected to Export Duty. ( Section54(3)).
- No refund of ITC is allowed if the supplier of the Goods or Services or both avails of drawback or refund of IGST paid on such supplies.
- No refund on closing stocks ( accumulated ITC on account of relatively low volume of output supplies to inward supplies)