Government has India has come out with several relief measures for saving people and economy from the wrath of this pandemic COVID-19. It is only a strong leader as our Hon’ble Prime Minister who can take such strong measures which are required for the survival of our nation and its people.
Yet, there are certain provisions which might have missed the attention of the administrators are there were bigger issues to be addressed. The following are suggestions which are crucial from the perspective of GST statutes for these turbulent times and which would provide requisite relief for those in action.
While many relaxations can wait, yet, certain procedural and exemptions important for this period need immediate attention. The author has summarised some suggestions for consideration as under:
Exemption to Supplies for quarantine and quarantined:
- Supplies of all medicines and equipment to hospitals be exempted provided a certificate from such Hospital is obtained.
- Specific exemption to COVID testing and treatment kits.
- Supplies made for establishment of hospitals including movable assets for COVID 19 should be exempted.
- Exemptions may be given to hotels who are giving rooms to persons who are under home quarantine.
Exemption to certain supplies which are result of force majeure:
- Exemption may be given from non levy of GST on amounts forfeited by suppliers on cancellation of contracts as they are already strained by such cancellations.
- Similar exemption for recipients who forfeit amount during this period on account of non performance by Suppliers of the contracts. (similar exemption is already available to Government)
- Any waiver between parties should not be seen as a supply for eg. Reduction of rent to ensure continuation of renting of premises by recipient etc.
- Amount received from Insurance Companies by Company for any kind of loss during this period may be exempted.
Relaxation of Valuation provisions:
- All LDs, penalties, interest etc levied during this period should not considered as consideration under Section 15 of CGST Act, 2017. Interest paid by recipient for amounts outstanding between 15.2.2020 till 30.09.2020 for non payment of consideration should not be considered as consideration.
- Any post supply discounts offered for supplies made during 15.2.2020 till 30.06.2020 should be allowed for issuance of credit notes as value negotiations would definitely come when things would normalise. Credit notes for such cases should be allowed under Section 34 of CGST Act.
- Any bad debt for non receipt of payment in respect of supplies made post 1.1.2020 till 30.09.2020 on account of contract cancellation or insolvency of recipient, GST can be reversed by the supplier on such supply.
Relaxation of ITC provisions:
- Relief from reversal of ITC for non payment for more than 180 days as many recepients are not able to make payment to vendors in normal course.
Relaxation of procedural provisions:
- E Way bill: Exemption may be given to suppliers of essential supplies (goods which are taxable) and being supplied during this period to consumers from e way bill.
