MM TAX CLUB

Gross GST collection in April 2022 is all time high, Rs 25,000 crore more than the next highest collection of Rs. 1,42,095 crore, just last month

The gross GST revenue collected in the month of April, 2022 is Rs 1,67,540 crore of which CGST is Rs  33,159 crore, SGST is Rs  41,793 crore, IGST is Rs  81,939 crore (including Rs  36,705 crore collected on import of goods) and cess is Rs  10,649 crore (including Rs  857 crore collected on import of goods).

The gross GST collection in April 2022 is all time high, Rs 25,000 crore more than the next highest collection of Rs. 1,42,095 crore, just last month.

The government has settled Rs 33,423 crore to CGST and Rs 26962 crore to SGST from IGST. The total revenue of Centre and the States in the month of April 2022 after regular settlement is Rs 66,582 crore for CGST and Rs 68,755 crore for the SGST.

The revenues for the month of April 2022 are 20% higher than the GST revenues in the same month last year. During the month, revenues from import of goods was 30% higher and the revenues from domestic transaction (including import of services) are 17% higher than the revenues from these sources during the same month last year.

For the first time gross GST collection has crossed Rs 1.5 lakh crore mark. Total number of e-way bills generated in the month of March 2022 was 7.7 crore, which is 13% higher than 6.8 crore e-way bills generated in the month of February 2022, which reflects recovery of business activity at faster pace.

Month of April 2022 saw the highest ever tax collection in a single day on 20th April 2022 and highest collection during an hour, during 4 PM to 5PM on that day. On 20th April 2022, Rs  57,847 crore was paid through 9.58 lakh transactions and during 4-5 PM, almost Rs  8,000 crore was paid through 88,000 transactions. The highest single day payment last year (on the same date) was Rs  48,000 crore through 7.22 lakh transactions and highest one hour collection (2-3PM on the same date last year) was Rs  6,400 crore through 65,000 transactions.

During April 2022, 1.06 crore GST returns in GSTR-3B were filed, of which 97 lakh pertained to the month of March 2022, as compared to total 92 lakh returns filed during April 2021. Similarly, during April 2022, 1.05 crore statements of invoices issued in GSTR-1 were filed. Till end of the month, the filing percentage for GSTR-3B in April 2022 was 84.7% as compared to 78.3% in April 2021 and the filing percentage for GSTR-1 in April 2022 was 83.11% as compared to 73.9% in April 2021.

This shows clear improvement in the compliance behaviour, which has been a result of various measures taken by the tax administration to nudge taxpayers to file returns timely, to making compliance easier and smoother and strict enforcement action taken against errant taxpayers identified based on data analytics and artificial intelligence.

The chart below shows trends in monthly gross GST revenues during the current year. The table shows the state-wise figures of GST collected in each State during the month of April 2022 as compared to April 2021.

State-wise growth of GST Revenues during April 2022

Background: Since FY 2019-20, composition taxpayers has to pay the liability through Form GST CMP-08 on quarterly basis while return in Form GSTR-4 is required to be filed on annual basis after end of a financial year.

Reason of Negative Liability in GSTR-4: The liability of the complete year is required to be declared in GSTR-4 under applicable tax rates. Taxpayers should fill up table 6 of GSTR-4 mandatorily. In case, there is no liability, the said table may be filled up with ‘0’ value. If no liability is declared in table 6, it is presumed that no liability is required to be paid, even though, taxpayer may have paid the liability through Form GST CMP-08. In such cases, liability paid through GST CMP-08 becomes excess tax paid and moves to Negative Liability Statement for utilization of same for subsequent tax period’s liability.

What the taxpayer did wrongly: Liability paid through Form GST CMP-08 is auto-populated in table 5 of the GSTR-4 for convenience of the taxpayers. Taxpayers who do not fill up table 6 of GSTR-4 i.e. no liability is declared, even though, taxpayer may have paid the liability through Form GST CMP-08; since the ‘Tax payable’ in GSTR-4 is computed after reducing the liability declared in GST CMP-08 which is auto-populated in table 5. Thus, if nothing is declared in table 6, then the negative liability entry appears in GSTR-4.

Debit of the negative liability – In the past, lot of tickets were received on the Helpdesk for reducing the negative liability from the Negative Liability Statement and the same was being done. For convenience of the taxpayers, the amounts available in negative liability statement have been debited for all taxpayers. It has been noticed that some taxpayers had utilised the amount available in negative liability statement for paying the liability to file statement in Form GST CMP-08 or GSTR-4 of subsequent financial year. In such cases, the amount utilised out of negative liability statement has been debited in the cash ledger. Though, such liability should have been paid by depositing the amount through challan but in some cases the amount had not been deposited by the taxpayers. The taxpayer who have deposited the amount in cash ledger, the debited amount has been adjusted whereas in case the amount of liability has not been deposited through challan, the balance in cash ledger becomes negative. In such cases, the taxpayers are advised to deposit the past liability through challan of equal amount urgently.

The details of the debit so made have been communicated to all such taxpayers through emails available on the portal. In case, the liability had been paid through adding in the next years’ liability, the same can be claimed as refund through application in Form GST RFD-01.

DRI crackdown on drug smuggling syndicates results in seizure of more than 3,300 kg of Heroin, 320 kg of Cocaine and 230 kg of Hashish between January and December 2021

Acting on intelligence jointly developed by DRI and ATS Gujarat, a container is being examined by DRI at Pipavav port, Gujarat in the presence of officers of ATS, Gujarat. The said container having gross weight of 9,760 kg was declared to contain ‘thread’. On a detailed examination on 28.04.2022, out of 100 jumbo bags, four suspicious bags having a total weight of 395 kg, containing threads showed the presence of opiate derivative/Heroin in the field testing done by the regional Forensic Science Laboratory.

It appeared that the drug syndicate used this unique modus operandi in which threads were soaked in a solution containing narcotic drug – heroin which were then dried, made into bales and packed in bags. These bags were shipped along with other bags having bales of normal threads so that it would go unnoticed by the authorities. The modus operandi in this case would have required the extraction of Heroin mixed in the threads. Examination and seizure proceedings by DRI under the provisions of the NDPS Act, 1985 are continuing.

The year 2021 has witnessed substantial seizures of drugs like Heroin, Cocaine, Hashish and psychotropic substances and precursors like Methamphetamine and Pseudoephedrine by the DRI. More than 3,300 kg of Heroin, 320 kg of Cocaine and 230 kg of Hashish were seized between January and December 2021. In addition, 170 kg of Pseudoephedrine and 67 kg of Methamphetamine were seized during this period.

Since January 2022, sustained efforts have yielded substantial results. Apart from the record seizures of 3,000 kg Heroin from a consignment of Talc in September 2021 at Mundra Port and 205 kg of Heroin from a consignment of Gypsum in April 2022 at Kandla Port, officers of DRI in two cases, booked in quick succession in February and March, 2022, seized Heroin from cargo containers at the container depot at Tughlakabad, New Delhi. In the first case 34.7 kg Heroin was seized from four containers declared to contain Rock Salt and in the second case 2.4 kg Heroin was seized in the form of sediment from a consignment of Pomegranate juice.

Syndicates have also tried to push narcotics like Yaba and Heroin from the Indo-Myanmar border and Hashish from the Indo-Nepal border, into India through the land borders. DRI officers have also intercepted such consignments from these borders, sometimes ingeniously concealed inside vehicles. DRI in one instance in February, 2022 seized one Lakh Yaba (Methamphetamine) tablets and affected multiple seizures of Heroin in North-East India, smuggled into India from Myanmar.

With easing of restrictions and opening of International Air travel after the restrictions imposed due to the Covid-19 pandemic were lifted, the numbers of air passengers arriving into India have increased. In the last two months, DRI has booked multiple cases of seizure of Heroin concealed in baggage and in the form of pills swallowed by body carriers. In one such major case, DRI seized 16 kg of Heroin in March 2022 concealed in the baggage of three passengers, who had arrived at Kolkata airport.

Multiple cases including seizure of 4.4 kg, 5.9 kg and 8.4 kg of Heroin in three separate seizures at Ahmedabad, seizure of 2.2 kg, 1.7 kg and 2.25 kg Heroin in the form of ingested capsules in three different seizures at New Delhi, seizure of 3.2 kg Heroin at Hyderabad and seizure of 4 kg and 7.9 kg Heroin in two different cases at Chennai have been affected by the DRI in the recent past. In the last two months, DRI has also booked three cases involving seizure of 3.7 kg of Cocaine in the form of ingested capsules from passengers arriving into India. Apart from these, a number of cases have been booked by the Airport Customs based on specific inputs provided by the DRI including seizure of about 17.90 Kg Heroin at IGI Airport on 10.04.2022 which was being carried by a serving officer of the Kenyan administration.

Air passengers have increasingly tried different ways and means to deceive DRI officers, including laminating the Heroin finely into their baggage which are almost invisible to the naked eye. Ingenious concealment methods like use of shampoos and food items to conceal the Heroin have also been observed. The most challenging cases are the ones where Air passengers are used as the body carriers, who ingest laminated pills of contraband, to smuggle them into India which not only require high level of intelligence work to precisely identify such carriers, but partly due to the inherent risks to the life of the carrier.

Updation of UDINs at e-filing Portal

Presently, various instances of invalidation of UDINs at the e-filing portal of Income Tax Dept. are being reported. The members are advised to try again to update those UDINs which have been invalidated earlier at the e-filing portal of Income Tax Dept. now.

Members are hereby advised to kindly update all the pending UDINs at the e-filing portal immediately.

Instruction No. 4/2022-Customs dated 27th April, 2022

Implementation of Notification No. 28/2021-Customs dated 24th April, 2021

Reference is invited to notification No. 28/2021-Customs dated 24th April, 2021 that sought to exempt customs duty and health cess on import of oxygen, oxygen related equipment and COVID-19 vaccines, up to 30th September, 2021.

2. S. No. 11 of notification No. 28/2021-Customs dated 24th April, 2021 provided exemption from the whole of customs duty and health cess to the parts of specified medical oxygen related equipment provided that importers follow the procedure set out in Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 (IGCR).

3. Certain references have now been received stating that in audits and verification, the issue of non-observance of conditions of IGCR is being raised.

4. In this context, it is stated that owing to the peculiar circumstance of the COVID-19 wave, parts of medical oxygen related equipment were imported on emergency requirement and at times are said to have been assembled at the premises of hospital or other establishments. Considering the medical national emergency faced by the nation, these very exceptional circumstances may have led to the importers not being able to adhere to certain procedural aspects of the IGCR. Considering the circumstances in which such imports were undertaken, the benefit of the exemption notification may not be denied, merely on the issue of not observing the procedure, provided that the goods so imported have been put to the intended use, i.e., in the manufacture of specified equipment related to the production, transportation, distribution or storage of Oxygen, which if required, is verifiable from invoices and other documents showing supply of such manufactured goods by the importer.

5. These instructions would apply only in respect to the imports made under the notification No. 28/2021-Customs dated 24th April, 2021 owing to the peculiar circumstances of the Covid-19 pandemic.