ANALYSIS OF BENEFICIAL AMENDMENTS IN GST IN BUDGET 2024

In July 2024, the finance minister Mrs Nirmala Sitharaman, presented the first budget of the new Government. As far as the GST proposals are concerned, they were largely brought in to implement the recommendations given by the GST Council at its 53rd meeting held recently.

- Gaurav Kenkre

CA Gaurav Kenkre is a CA in practice for the last 11 years. He is a regular speaker at various professional organizations, trade bodies, MNCs and Government bodies. He also writes regularly in local as well as national publications. Besides this he holds various positions in bodies such as ICAI, GCCI, College bodies, Rotary etc.

In July 2024, the finance minister Mrs Nirmala Sitharaman, presented the first budget of the new Government. As far as the GST proposals are concerned, they were largely brought in to implement the recommendations given by the GST Council at its 53rd meeting held recently. This article envisages to critically analyse two of the proposals made in the budget, which are of paramount importance to taxpayers, since they offer substantial relief in very vexed issues.

It is important to note that at this time, the budget proposals are only proposals, and need to be passed by both houses, and need to receive the President's assent, before they become enforceable in law.

1. Insertion of Sec 16(5) in the CGST Act 2017

Trade at large has been deeply affected by the provisions of Sec 16(4) of the CGST Act. The section said that, taxpayers can avail input tax credit for any particular financial year, only upto 30th November succeeding the financial year. Thus, for Financial Year 2023-24 for egs, the last date for claiming GST input credit was 30-11-2024. This itself, was an extended date i.e. the earlier date was effectively 20th October. So, for the initial years i.e. for FY 2017-18, FY 2018-19, FY 2019-20, the time limit expired on 20th October after the respective year. Only for FY 2017-18 the date was extended till 31.3.2019 with some conditions.

Due to this, there were several cases of taxpayers having their input tax credit being disallowed, for not having claimed it within the above timelines.