MM TAX CLUB

ind reference is invited to Board’s Circulars 09/2015-Cus  dated  31.03.2015,  03/2016-Cus dated 03.02.2016 and 10/2016-Cus dated 15.03.2016, regarding the Indian Customs' Single Window. In brief, vide the above referred Circulars –

(a)six  Partner  Government  Agencies  (PGAs)  were  brought  on  board  the Single  Window Interface for Facilitating Trade (SWIFT). This platform enabled importers to lodge their clearance documents online through ICEGATE at a single point, facilitated risk-based inspection and an Online  NoC  from  the  PGAs  could  be  obtained,  without  the  trader  having  to  approach  these agencies.

 (b)these agencies were Food Safety and Standards Authority of India (FSSAI), Plant Quarantine (PQ), Animal Quarantine and Certification Services (AQCS), Central  Drugs  Standards  Control Organization (CDSCO), Wildlife Crime Control Bureau (WCCB), and a lab module for the Textile Committee (TC) to provide its NOC for live consignments

.2.Under SWIFT, the FSSAI and PQ are connected through online message exchange with their own systems, while the remaining four PGAs use ICES for providing online NoC. Further, vide Circular No. 01/2017-Cus dated 04.01.2017, the facility for automatic routing ofBills of Entry (BOEs) of WCCB for NoC in exports in SWIFT was introduced.

3.Further,  the  facility  of  eSANCHIT,  was  enabled  for  the  importers/exporters  to  upload  all Licenses, Permits , Controls and Orders( LPCOs) issued by the PGAs and other documents on

ICEGATE, via Circular no. 40/2017-Cus dated 13.10.2017 and extended to exports across the country,  vide  Circular  No  43/2018-Cus  dated  08.11.2018.  The  facility  of  eSANCHIT  was leveraged  for  uploading  of  authorisations  and  LPCOs  issued  by  PGAs  in  PDF  format,  thus dispensing  with  the  requirement  of  importers  and  exporters  to  separately  upload  these documents,  in  phases  vide  Circular  nos.  44/2018-Cus  dated  13.11.2018,  13/2019-Cus  dated 03.06.2019, 19/2019-Cus dated 16.07.2019, 03/2020-Cus dated 15.01.2020, 11/2020-cus dated 10.02.2020 and 24/2020-Cus dated 14.05.2020

4.To  enhance  transparency  and  better  informed  compliance,  the  Compliance  Information Portal (https://cip.icegate.gov.in/CIP/#/home) was launched on 04.08.2021 on a single platform to provide all necessary information related to Customs laws, procedures along with applicable duties  and  taxes  on  each  Customs  Tariff  Item,  as  also  the  information  about  necessary permissions to be obtained from any PGA for import or export of goods

5.1 To further enhance SWIFT, the Digital Import Clearance Systemof AQCS-ICS has been developed  by  AQCS  for  purposes  of  improved  functioning.  This  would  enable  migrating  from Online NoC through ICES to online message exchange mode, similar to that of FSSAI and PQMS. The AQCS-ICS shall be introduced from 01.12.2022. Forthis, thefollowing changes will be made in the Customs System:

5.2Integrated Declaration:

To  enhance  the  ambit  of  paperless  processing  and  to  facilitate  risk-based  inspection, changes in the Integrated Declaration as follows:

a.The importer must upload the Veterinary Health Certificateissued by the exporting country with  Document  Code  853AQ1  for  the  concerned  Customs  Tariff  Items  (  CTIs)  listed  in Annexure A (Sl.No 1) of this Circular.

b.The  importer  must  upload  the Laboratory  reports/certificate  of  analysis  (COA)with Document Code 001AQ1, for the concerned CTIs listed in Annexure A (Sl.No 2) of this circular

c.The  Importer  must  quote  the  IRN  generated  in  eSanchit  pertaining  to  Sanitary  Import Permit with document Code 911DF1, issued and uploadedby AQCS, for the concerned CTIs listed in Annexure A(Sl.No3) of this Circular to obtain the NoC.

d.The  importer must  give  the  following  declaration under  Statement  Code AQ002  at  item level for the CTIs listed in Annexure Bof this Circular: “I certify that the invoice issued by Authorised officer of Manufacturer in the exporting country contains a declaration that the product has undergone the irreversible process of tanning in terms of O.M vide F.No. L-110110/17/2017-Trade-Part(1) (E-15243) dated 17.12.2021.”

”5.3Risk-based Inspection:

Based on the above additional data being received through integrated declaration, risk-based selectivity criteria shall be introduced in stages for CTIs requiring NoC from AQCS along with the integration of AQCS-ICS with ICEGATE.

Page 3of 55.4Post Filing requirements for NoC by AQCS:

            All documents required to be submitted to AQCS to obtain NoC, will normally be uploaded during Integrated Declaration. Under circumstances where additional documents are required by AQCS from the importer post-filing, the importer may submit the same by logging in via  ICEGATE.  Till  the  time  that  the  integration  of  AQCS-ICS  with  ICEGATE  is  complete,  the importer may log in to the AQCS-ICS portal to submit the additional documents.

5.5Electronic transmission of NoC toCustoms:The  Online  NoC  will  be  automatically  transmitted  to  ICEGATE,  and  importers  will  also have complete visibility as soon as it is issued (or rejected) by PGA officers. Any further queries by PGA officers as well as real time tracking of the status of processing of applications can be accessed through ICEGATE portal and as well as the AQCS-ICS Portal.

6.With  the  introduction  of  AQCS-ICS,  there  is  no  change  in  the  role  or  functioning  of Customs officers. The Customs officers would be able to accessthe details of the BOEs referred by  ICES  to  AQCS-ICS.  The  electronically  received  Release  Order  (RO)  regarding  the  BOEs referred  to  AQCS-ICS  shall  be  accepted  by  the  Customs.  The  documents  referred  before  the implementation of this Circular will continue to be processed in ICES.

7.Suitable Public Notices may please be issued to guide the trade/industry

. 8.Any difficulties in this regard may be brought to the notice of the Board at the earliest.

INSTRUCTION No. 04/2022-GST dated 28-11-2022

Manner of processing and sanction of IGST refunds, withheld in terms of clause (c) of sub-rule (4) of rule 96, transmitted to the jurisdictional GST authorities under sub-rule (5A) of rule 96 of the CGST Rules, 2017

Attention is invited to Standard Operating Procedures (SOPs) for verification of risky exporters and their suppliers dated 23.01.2020 issued to CGST and Customs formations as well as Directorate General of Analytics and Risk Management (DGARM) and SOP dated 20.05.2020 issued to CGST formations and DGARM vide F. No. CBEC-20/16/07/2020-GST which provided for the procedure to be followed for verification of the risky exporters and their suppliers. The said SOPs provided that DGARM would identify the exporters and their suppliers on the basis of risk parameters, approved by the Competent Authority and would forward the list of such exporters to the Risk Management Centre for Customs (RMCC) for putting alert in the system. In such cases, the Customs field formations were required to conduct the detailed examination of the export goods of such identified exporters. Further, the jurisdictional CGST formations were required to conduct detailed verification of such identified exporters and their suppliers and forward the verification report to DGARM. On receipt of verification report from CGST formations, DGARM was required to take a decision for issuance of NOC or otherwise. In cases where NOC has been issued by DGARM, the same was communicated to the Customs authorities at the port of export for release of withheld IGST refunds of such exporter. Further, DGARM was also required to review whether the exporters can be removed from the list of identified exporters.

2: However, rule 96 of the Central Goods and Service Tax Rules, 2017 (hereinafter referred to as ‘CGST Rules’) has been amended retrospectively w.e.f. 01.07.2017 to provide for withholding of IGST refund in cases where the verification of credentials of the exporter, identified on the basis of data analytic including the availment of ITC by the exporter is considered essential before grant of refund. Clause (c) of sub-rule (4) of rule 96 is reproduced below:

(c) the Commissioner in the Board or an officer authorised by the Board, on the basis of data analysis and risk parameters, is of the opinion that verification of credentials of the exporter, including the availment of ITC by the exporter, is considered essential before grant of refund, in order to safeguard the interest of revenue.

2.1 Accordingly, Principal Director General/ Director General of Directorate General of Analytics and Risk Management (DGARM), CBIC, New Delhi has been authorised by the Board to exercise the functions under clause (c) of sub-rule (4) of rule 96 of the CGST Rules vide Order No. 01/2022-GST dated 21.07.2022 issued vide CBIC-20023/04/2021-GST.

2.2 Further, sub-rule (5A) has been inserted in rule 96 to provide for transmission of IGST refunds, withheld in terms of provisions of clause (c) of sub-rule (4) of rule 96 of the CGST Rules, as system generated refund in Form GST RFD-01 and to provide that the said system generated form shall be deemed to be the application for refund in such cases and such application for refund shall be deemed to have been filed on the date of such transmission on the portal. In addition, sub-rule (5C) has also been inserted in rule 96 to provide that such system generated refund in FORM GST RFD-01 have to be dealt with in accordance with rule 89 i.e. in a manner similar to other GST RFD-01 refund claims.

3. In view of the aforesaid amendments, certain changes have been made in the alert module on ICES for which an Advisory No. 14 dated 29/09/2022 has been issued by DG Systems to all the system managers. In the said advisory, it has been inter-alia informed that a new role for putting an all-India suspension, either on IEC or GSTIN of the exporter as the case may be, to withhold IGST refunds has been developed for officers of DGARM. An option to revoke the said alert has also been made available to DGARM officers. Further, instructions have also been issued by DG _ Systems vide F. No. DGSYS/APP/ICES/GEN/41/2022 dated 29.09.2022 to the Customs field formations regarding the procedure to be followed by them in respect of IGST refunds withheld due to DGARM alerts on risky exporters.

4. DGARM on the basis of data analysis and risk parameters, would identify the exporters where verification of credentials of the exporter, including the availment of ITC by the exporter, is considered essential before grant of refund. DGARM would then place an all-India alert on such exporter on Indian Customs EDI system along with the reasons for putting the said alert. Once an alert is placed on an exporter, the IGST refunds of such exporters would be withheld and the data in respect of Shipping Bills filed by such exporter, for which IGST Scroll could not be generated due to DGARM alert, along with the reasons thereof would be transmitted to GSTN through ICEGATE for generation of refund claims in FORM GST RFD-01 in terms of provisions of sub-rule (5A) of rule 96. Besides, the past cases where the exporter was identified as risky, which could not be processed due to pending verification or due to receipt of negative report, would also be transmitted to GSTN through ICEGATE for generation of refund claims in FORM GST RFD-O1 in terms of provisions of sub-rule (5A) of rule 96.

5. Such refund claims will be made available to the jurisdictional proper officer on back-office system under the category “Any other (GST paid on export of goods)” with the remarks “Refund of IGST paid on export of goods (Refund not processed by ICEGATE)”. Further, the risk parameters, on basis of which the exporter has been identified as risky by DGARM, would be shared with the jurisdictional tax officers along with the system generated refund claim in FORM GST RFD-01. In cases where the verification report in respect of the exporter has already been submitted to DGARM by the jurisdictional CGST authorities, the details of the same would also be shared with the jurisdictional proper officer, along with the said system generated refund claim in FORM GST RFD-01. Transmission of such IGST refunds to the jurisdictional proper officers, withheld on account of identification of exporter as risky by DGARM, is being initiated on the portal.

6. On receipt of such refunds, the jurisdictional proper officer shall immediately process such refund claims in a manner similar to other RFD-01 refunds filed under the provisions of rule 89 of the CGST Rules, 2017.

i. However, it may be noted that as these refund claims have been generated by the system on the basis of Shipping Bills/ Bills of Export filed by the exporter, these claims would be auto-acknowledged by the system and no Deficiency Memo in Form GST RFD-03 can be issued against such system generated Form GST RFD-01 refund claims.

8. The proper officer shall ascertain the genuineness of the exporter & verify the correctness of availment and utilisation of ITC by the exporter and exercise due diligence in processing the said refund claims to safeguard interest of revenue. The proper officer may conduct the physical verification of places of business of the exporter, if required, to ensure that the exporter is existing at his declared place of business and is functional/active.

9. The proper officer shall pass a detailed speaking order in respect of the refund claim and shall duly upload the same along with the refund sanction order in Form GST RFD-06 on the portal in terms of Instruction No. 03/2022-GST dated 14.06.2022. The officer will also follow the timelines for processing of the refund claim in terms of provisions of sub-section (7) of section 54 of the CGST Act. It is needless to mention that the procedure of review and post-audit as prescribed in para 2.2 of Instruction No. 03/2022-GST dated 14.06.2022 will also be applicable to such refund claims.

10. In cases where the detailed investigation of the exporter or his suppliers is required to be conducted to verify the genuineness and correctness of ITC availed by the exporter, the matter may be examined, if required, for resorting to provisions of sub-section (11) of section 54 of the CGST Act, 2017 for withholding of the refund.

11. Further, the proper officer would also be required to provide feedback on the common portal while issuing refund sanction order in FORM GST RFD-06 as with recommendation as to whether the alert against the said taxpayer need to be continued or whether the same can be removed. The functionality for the same would be available on the system in due course.

12. GSTN shall transmit the data regarding the outcome of processing of refund by the proper officer, along with the feedback received from the proper officer on the requirement of removal or continuation of alert, to DGARM for necessary action for removal or continuation of alert.

13; The Zonal Principal Chief Commissioners/ Chief Commissioners are requested to closely monitor the progress of disposal of such transmitted refund claims to ensure that due verification has been conducted before sanction and the refunds have been processed in a timely manner.

14. In view of the above, the SOPs dated 23.01.2020 and 20.05.2020 prescribing the procedure to be followed for verification of the risky exporters and their suppliers, are hereby superseded.

15. Difficulty, if any, in implementation of these instructions may please be brought to the notice of the Board.

Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman chaired the pre-budget consultation meetings for Budget 2023-24 held in virtual mode from 21st to 28th November, 2022. The pre-budget meeting were concluded here today.

More than 110 invitees representing 7 stakeholder groups participated in 8 meetings scheduled during this period. The stakeholder groups include representatives and experts from Agriculture and Agro Processing Industry; Industry, Infrastructure & Climate Change; Financial Sector and Capital Markets; Services and Trade; Social Sector; Trade Unions and Labour Organisations and Economists.

Union Ministers of State for Finance Shri Pankaj Chaudhary and Dr. Bhagwat Kishanrao Karad, Finance Secretary Shri T.V. Somanathan; Secretary, DEA, Shri Ajay Seth; Chief Economic Advisor, Dr. V. Anantha Nageswaran; Secretary, DIPAM, Shri Tuhin Kanta Pandey; Secretary, Financial Services, Shri Vivek Joshi; Secretary, Corporate Affairs, Shri Manoj Govil; OSD, Revenue, Shri Sanjay Malhotra, and senior officers from Ministry of Finance were also present during the meetings. Secretaries of other Ministries/Departments concerned participated through online mode.

The representatives of the stakeholder groups made a number of suggestions for the forthcoming budget that included mechanism for green certification to help MSMEs , urban employment guarantee programme to boost employment generation in urban areas, rationalisation of income tax, creation of innovation clusters, schemes for  improving domestic supply chains,  reduction of taxes on electric vehicle, introduction of EV policy,  measures to promote India as a hub for Green Hydrogen, Social Sector Entrepreneurship Fund for Social Impact Companies, Training and Accreditation of Care Economy Workers, portable social benefit for children, National Regulatory Authority for Water and Sanitation, coverage of unorganised workers under ESIC, continuation of Public Capex, fiscal consolidation and lower customs duties, among others.

The Finance Minister thanked the participants for sharing their valuable suggestions and assured that suggestions would be carefully considered while preparing the Budget 2023-24.

Press Release dated 26/11/2022

ED has provisionally attached 40% Share of the Hotel Project (1,40,000 Sq.Ft. FSI Space) with in the Commercial Centre, “Garden’s Galleria”, Noida . The attached asset was owned by Unitech M/s Ranchero Services Limited, Cyprus which is a benami overseas company of Chandras, Promoter of Unitech Group and the value of attached asset ₹ 65.32 Crore.

Investigation by ED revealed that Unitech Group had invested the Proceeds of Crime to the tune of USD 8 Million through a benami company M/s Ranchero Services Limited, Cyprus into Unitech Hotels Private Limited in the year 2007-2008. Investigation revealed that M/s Ranchero Services Limited, Cyprus is owned by Chandra’s and was being managed through an overseas trust on their behalf.

During the course of investigation ED has arrested five individuals namely Sanjay Chandra, Ajay Chandra, Ramesh Chandra, Preeti Chandra and Rajesh Malik. Till now, 2 Prosecution complaints have been filed by the ED and cognizance of the same have been taken by the Hon’ble PMLA Court. Vide 16 Provisional attachment orders including the current attachment, various domestic and overseas assets having total value of ₹ 1132.55 crore have been attached. The attachment includes the attachment of assets of Carnoustie Group, Shivalik Group, Trikar Group and the assets of Shell, Benami & personal companies of Chandras etc. Total proceeds of crime of more than Rs. 6500 Crore has been detected till now in this case.

Further investigation is in process.