Sixth Amendment to CGST Rules, 2019 – Key Compliance Updates

Notification No.: 49/2019 – Central Tax
Date of Notification: 9th October 2019
Relevant Sections and Rules:

• Central GST Act, 2017:
  • Section 164 – Power to make rules
  • Section 31(3)(a) – Tax invoice for supplies
  • Section 40 – First return
  • Section 73 & 74 – Determination of tax
  • Section 39 – Monthly returns
  • Section 37 – Outward supplies
  • Section 38 – Inward supplies
  • Section 44 – Annual return
• CGST Rules, 2017 (Amendments):
  • Rule 21A – Suspension of registration
  • Rule 36(4) – ITC restriction to 20% of matched invoices
  • Rule 61(5) – GSTR-3B substitution
  • Rule 83A(6)(i) – Practitioner exam
  • Rule 91 – Refund procedure
  • Rule 97 – Consumer Welfare Fund usage
  • Rule 117 – TRAN-1 deadline extended
  • Rule 142 – Pre-SCN communication (DRC-01A form inserted)

Summary of Notification

1. Clarification on Registration Suspension (Rule 21A):
   A registered person under suspension cannot issue tax invoices or charge GST. If suspension is revoked, Section 31(3)(a) and Section 40 procedures will apply retrospectively to supplies made during the suspended period.
2. Input Tax Credit Restriction (Rule 36(4)):
   ITC can now be claimed only up to 20% of the eligible credit available in GSTR-2A (uploaded by suppliers). Any excess unmatched ITC will not be eligible.
3. GSTR-3B Formalised as Main Return (Rule 61(5)):
   Substituted retrospectively w.e.f. 1st July 2017:
   GSTR-3B shall be the prescribed return in lieu of GSTR-3 when GSTR-1 and GSTR-2 due dates are extended. GSTR-3 need not be filed in such cases.
4. GST Practitioner Exam Relaxation (Rule 83A):
   GST practitioners under Rule 83(1)(b) must pass the exam within the period specified under the second proviso to Rule 83(3).
5. Refund Disbursement Clarity (Rule 91):
   From 24th Sept 2019, refund shall be processed on the basis of a consolidated payment advice, and disbursed by the Central Government.
6. Consumer Welfare Fund Allocation (Rule 97):
   50% of the Fund amount credited each year will be allocated for GST publicity/awareness, subject to a minimum of ₹25 crore per year for Department of Consumer Affairs.
7. TRAN-1 Deadline Extended (Rule 117):

• TRAN-1 filing date extended from 31st March 2019 to 31st December 2019
• TRAN-2 declaration for stock extended from 30th April 2019 to 31st January 2020

8. Pre-SCN Communication Introduced (Rule 142 – DRC-01A):
   Before issuing SCNs under Section 73(1) or 74(1), proper officers must first intimate tax liability via DRC-01A:

• Part A: For officer’s tax/penalty estimation
• Part B: For taxpayer’s submission or partial payment response

This enables voluntary compliance and prevents litigation.

Source: Notification No.: 49/2019 – Central Tax