FAQs – Application of provisions of CGST Act to IGST Act – ( Section No 20 ) (Similar provisions are there in UTGST Act vide Section 21)
Q 1. What are the provisions of CGST Act, which have been made applicable to IGST Act by S.20 of IGST Act?
Ans. The following provisions of CGST Act shall mutatis mutandis apply, so far as they may be applicable to IGST Act;
(i) scope of supply;
(ii) composite supply and mixed supply;
(iii) time and value of supply;
(iv) input tax credit;
(vi) tax invoice, credit and debit notes;
(vii) accounts and records;
(viii) returns, other than late fee;
(ix) payment of tax;
(x) tax deduction at source;
(xi) collection of tax at source;
(xv) inspection, search, seizure and arrest;
(xvi) demands and recovery;
(xvii) liability to pay in certain cases;
(xviii) advance ruling;
(xix) appeals and revision;
(xx) presumption as to documents;
(xxi) offences and penalties;
(xxii) job work;
(xxiii) electronic commerce;
(xxiv) transitional provisions; and
(xxv) miscellaneous provisions including the provisions relating to the imposition of interest and penalty,
Q 2. What are the provisions of CGST Act, which shall apply to IGST Act, but with changes?
Ans. The following provision of CGST Act shall apply to IGST act, not identically but with the following changes;
1. In case of tax deducted at source, the deductor shall deduct tax at the rate of two per cent. from the payment made or credited to the supplier (instead of one percent under CGST Act):
2. In case of tax collected at source, the operator shall collect tax at such rate not exceeding two per cent, as may be notified on the recommendations of the Council, of the net value of taxable supplies: (instead of one percent under CGST Act):
3. The value of a supply shall include any taxes, duties, cesses, fees and charges levied under any law for the time being in force under CGST Act (to be read as IGST Act, in the context of IGST Act), and the Goods and Services Tax (Compensation to States) Act, if charged separately by the supplier
4. In a case where penalty is leviable under the Central Goods and Services Tax Act and the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, the penalty leviable under this Act shall be the sum total of the said penalties (i.e. sum total of penalties under CGST and SGST).
Import of Service made on after IGST Act has come into effect (Section No 21)
Q 3. If services are imported after the commencement of IGST Act, would such service be liable to IGST, though the transaction has been initiated under service tax law (i.e. before the commencement of IGST Act)?
Ans. Yes. If a service is imported on or after the day IGST has come into force, then such service shall be liable to IGST, regardless of the fact whether the transaction(s) for such import of services had been initiated before IGST has come into force (i.e. when service tax law was in force)
Q 4. When is a supply of service transaction deemed to be initiated before the commencement of IGST Act?
Ans. A transaction of supply of service is deemed to have been initiated before the day IGST comes into existence, if either:
1. The invoice relating to such supply or
2. Payment, either in full or in part, has been received or made before IGST Act has come into existence.
Q 5. In the above circumstance, then should tax be paid twice, once under service tax law and secondly under IGST Act?
Ans. No. If service tax on such import of services has already been paid in full under the service tax law, then IGST shall not be payable again at the time of actual import of such service.
Q 6. What if tax is paid only in part under service tax law and part of the tax becomes payable under IGST law?
Ans. In certain cases, part of the consideration for import of service is paid in advance or part of the consideration is paid according to milestone completion method under service tax law. Service tax would not have been paid on the balance consideration since either service would not have been completed or part of the consideration remains payable on the day service tax law is rescinded. In such cases, IGST would be payable on the balance portion of service supplied/ consideration paid under the IGST regime.
Power to make Rules (Section No 22)
(Similar provisions are there in UTGST Act vide Section 22)
Q 7. Which Section provides the Central Government with the power to make Rules for IGST
Ans. S. 22 of IGST provides the Central Government with the power to make Rules for the purpose of IGST Act.
Q 8. What are the matters on which the Central Government may make Rules under IGST
Ans. The Central Government may make rules for all or any of the matters which under IGST Act, it is required to prescribe or in respect of which provisions are to be made by way of rules.
Q 9. Can the Central Government make rules with retrospective effect?
Ans. The Government has been given the power to make rules with retrospective effect, from a date, not earlier that the date on which the provisions of the Act, under which the Rules are made have come into force.
Q 10. Does government have the power to prescribe penalty amount in the Rules? Can penalty be prescribed when the Rules are given retrospective effect?
Ans. Yes. The government has the power to enact provisions in the rules stating that contravention thereof would be liable to penalty. However the penalty amount has been restricted to Rs. 10,000/-.
Power of Board to make Regulations (Section No 23) – (Similar provisions are there in UTGST Act vide Section 23)
Q 11. Who can make rules?
Ans. The Central Board of Excise & Customs has been delegated with the power to make Regulations.
Q 12. What are the conditions subject to which the Regulations may be made by the Board?
Ans. The Regulations made by the Central Board of Excise & Customs must be consistent not only with the GST Act but also the Rules notified by the Central Government.
Laying of Rules, Regulations and Notification before the Parliament (Section No 24)
(Similar provisions are there in UTGST Act vide Section 24)
Q 13. Whether the Rules and Regulations promulgated by the Central Government and Board respectively must be laid before the Parliament?
Ans. Yes. Every rule made by the Government, every regulation made by the Board and every notification issued by the Government under this Act, shall be laid, as soon as may be after it is made or issued, before each House of Parliament.
Q 14. When and for what period should the Rules, Regulations and Notification be laid before the Parliament?
Ans. The Rules, Regulations and Notification must be laid before the Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions.
Q 15. What if the Parliament makes modification/ annuls the Rules, Regulations and Notifications so laid?
Ans. If, before the expiry of the aforesaid period, both Houses agree in making any modification in the rule or regulation or in the notification, or both Houses agree that the rule or regulation or the notification should not be made, the rule or regulation or notification, shall thereafter have effect only in such modified form or be of no effect.
Q 16. What would be the sanctity of anything done/ omitted to be done on the basis of Rules, Regulations or Notifications, which are subsequently modified/ annulled by the Parliament
Ans: The modification or annulment made by the Parliament shall be without prejudice to the validity of anything previously done under that rule or regulation or notification, as the case may be.
Removal of Difficulties (Section No 25)
(Similar provisions are there in UTGST Act vide Section 26)
Q 17. What is the way out, if any difficulty arises in giving effect to the provisions of the Act?
Ans. If any difficulty arises in giving effect to any provisions of this Act, the Central Government may, on the recommendations of the Council, by a general or a special order published in the Official Gazette, make such provisions, which are consistent with the provisions of the Act, the rules and regulations, as may be necessary or expedient for the purpose of removing the said difficulty.
Q 18. Is there any time limit for the Central Government to issue the General Order/ Special Order to remove the difficulty?
Ans. The Central Government has the power to issue General Order/ Special Order to remove the difficulty arising while giving effect to the provisions of this Act, within a period of three years from the date of commencement of the CGST Act.
Q 19. Should the General/ Special Order so passed by the Central Government be laid before the Parliament?
Ans. Yes. Every General/ Special order shall be laid, as soon as may be, after it is made, before each House of Parliament.
Miscellaneous (Section 20 to 25)
Q 1. What provisions of CGST have been made applicable to IGST?
(a) All provisions
(b) Only a few provisions
(c) The provisions of CGST Act as would be applicable to IGST has not been mentioned
(d) The exact provisions of CGST Act as would be applicable to IGST have not been enumerated. However a list of items have been mentioned, whose corresponding provisions under CGST would apply to IGST Act.
Ans. (d) The exact provisions of CGST Act as would be applicable to IGST have not been enumerated. However a list of items have been mentioned, whose corresponding provisions under CGST would apply to IGST Act.
Q 2. What would the TDS and TCS rates be under IGST?
(a) TDS and TCS provisions not applicable to IGST since no such provisions have been incorporated under IGST Act
(b) At the rates mentioned in CGST Act
(c) At the rate equal to CGST Act + SGST Act
(d) At double the rate mentioned in CGST Act
Ans. (d) At double the rate mentioned in CGST Act
Q 3. When is a service transaction deemed to have been initiated before commencement of IGST Act?
(a) When invoice relating to such supply has been received or made before IGST has come into existence
(b) Payment is made/ received either in part or full before IGST has come into existence
(c) Both of the Above
(d) None of the Above
(e) Any one of the Above
Ans. (e) Any one of the Above
Q 4. Is IGST payable on services imported after the appointed day, though service tax has actually been paid under service tax regime?
(b) Yes. Pay and avail the credit paid of IGST under reverse charge on full value
(c) Yes. If tax has been paid partially under service tax regime and part of the service/ consideration paid has not suffered service tax under service tax regime
Ans. (c) Yes. If tax has been paid partially under service tax regime and part of the service/ consideration paid has not suffered service tax under service tax regime
Q 5. Can government make retrospective rules?
(a) Yes. But cannot impose penalty for contravention of rules for retrospective period
(b) Yes and also can impose penalty for contravention of rules for retrospective period
Ans. (a) Yes. But cannot impose penalty for contravention of rules for retrospective period
Q 6. What is the effect if the parliament annuls the rules/ notifications issued by
(a) It is as good as no rules/ notifications were issued by the government
(b) The rules/ notifications issued by the government would be effective for the period from the date of issue till the date they were annulled by the parliament
(c) There would be no sanctity for the action taken by the department/ assessee on the basis of rules/ notification for the period from the date of issue till the date of annulment.
(d) The action taken by the department/ assessee from the period of issue of rules/ notification till date of annulment would be valid.
(e) (a) and (c)
(f) (b) and (d)
Ans. (f) – (b) and (d)
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