Changes in GSTR 3B – Explained

 

Vide Notification 14/2022 Central Tax (Rates) dated 5th July 2022, various changes have been made in the format of GSTR-3B return. Vide Circular No. 170/02/2022-GST dated 6th July 2022, the various changes in GSTR-3B have been explained. The changes can broadly be classified under three heads.

•   Changes relating to supplies through E-commerce operators.

As per Section 9 (5) of the CGST Act (and the corresponding provisions under the SGST Acts, IGST Act, UTGST Act), for certain notified supplies made through E-commerce operators, the tax has to be paid by the E-commerce operator and not by the actual suppliers. The following services are notified under Section 9 (5).

• Transportation of passengers by radio taxi, motor cab, maxi cab, motor cycle, omni bus or any other motor vehicle.
• Hotel accommodation (except where the Hotel is registered)
• Housekeeping, plumbing and carpentry.
• Supply of food.

Vide Circular No. 167/23/2021 Dt. 17.12.2021 it was clarified as to how, the turnover, for which the E-commerce operator is liable to pay tax have to be shown in the returns filed by the supplier and the E-commerce operator. Now, separate Table has been added for this purpose in GSTR -3B.

The E-commerce operator, who pays tax for such supplies under Section 9(5) shall indicate the value in the newly introduced Table 3.1.1 (i) of GSTR-3B. The Supplier shall indicate the value, for which tax is paid by E-Commerce operator under Section 9 (5) in the newly introduced Table 3.1.1 (ii) of GSTR-3B.

As a consequence, the clarification issued vide Circular No. 167/23/2021 Dt. 17.12.201, requiring the supplier to show such value in Table 3.1(c) and requiring the E-commerce operator to show this value in Table 3.1 (d) is being superseded by this amendment.

The changes in the form are highlighted in red below

Table 3.1 Detail of Outward Supplies and Inward supplies liable to reverse charges

Nature of Supplies	Total Taxable Value	Integrated Tax	Central tax	State Tax	Cess
1	2	3	4	5	6
(a) Outward taxable supplies (other than zero rated, nil rated and exempted)
(b) Outward taxable supplies (zero rated)
(c) Other outward supplies, (Nil rated, exempted)	Comment : Taxable supplies made through ecommerce operator, where the E-com operator is liable to pay tax, will not be shown here by the supplier anymore. It will be shown under Table 3.1.1(ii) inserted below.
(d) Inward supplies (liable to reverse charge (other than those covered in 3.1.1)	Comment : The E-com operator shall not indicate the value on which he is liable to pay tax under Section 9 (5) in this column. It will be shown under Table 3.1.1 (i) inserted below.
(e) Non GST outward supplies

3.1.1 Details of supplies notified under sub-section (5) of Section 9 of the Central Goods and Services Tax Act, 2017 and corresponding provisions in Integrated Goods and Services Tax Act/Union territories Goods and Services Tax Act/State Goods and Services Tax Act

Nature of Supplies	Total Taxable Value	Integrated Tax	Central tax	State Tax	Cess
1	2	3	4	5	6
(i) Taxable supplies on which electronic commerce operator pays tax under sub-section (5) of section 9 [to be furnished by the electronic commerce operator]	Comment : This has to be filled by the E-com operator, who is liable to pay tax under section 9(5).
(ii) Taxable supplies made by the registered person through electronic commerce operator, on which electronic commerce operator is required to pay tax under sub-section (5)              of              section              9 [to be furnished by the registered person making supplies through electronic commerce operator]	Comment : The supplier has to show the value of supplies made through E-Com operators, where the E-com operator is liable to pay tax.

• Changes relating to reporting of inter-state supplies.

Under Table 3.2, the details of inter-state supplies made to unregistered persons, composition tax payers and UIN holders have to be reported place of supply wise. Now this requirement is extended to the E-commerce operator who is liable to pay tax under Section 9 (5).

Table 3.2 Out of the supplies shown in 3.1 (a) and 3.1.1(i) above, details of inter-State supplies made to unregistered persons, composition taxable persons and UIN holders

	Place of Supply (State/UT)	Total Taxable Value	Amount of Integrated Tax
1	2	3	4
Supplies made to Unregistered Persons	Comment: This information would be auto populated from GSTR 1. This table has to be filled up by E-com operators who are liable to pay tax under Section 9 (5) also.
Supplies made to Composition Taxable Persons
Supplies made to UIN Holders

• Changes relating to ITC

Presently, Table 4A of GSTR-3B contains the details of various ITC being claimed. Table 4B contains details of various reversals. Table 4C, i.e. the difference between 4A and 4B would be the Net ITC, that would be carried forward to Electronic Credit Ledger.

The effect of various changes made in this regard are explained below.

Credits which are blocked under Section 17 (5) shall also be included in Table 4A. They have to be separately reversed under Table 4B (1). Earlier, blocked credit under Section 17 (5) would not form part of Table 4A and would be shown only in Table 4D (1). Now, even such blocked credits under Section 17 (5) shall be included in Table 4A and reversed through Table 4B (1). In other words, the practice of excluding blocked credit and claiming only eligible ITC in Table 4A can no longer be followed.

Similarly, the Banking companies and Financial Institutions, who opt to avail 50 % ITC under Rule 38, shall show the entire ITC in Table 4A and show the 50 % reversal in Table 4B (1).

In Table 4 B (2), all other reversals, other than what is covered in 4B (1) have to be shown.

Table 4D has been amended. In Table 4D (1), the credits reclaimed in different situations have to be shown. For example, if payment to the supplier is not made within 180 days, the credit has to be reversed through Table 4B (2). As and when payments are made to the supplier, the reclaimed credit has to be shown in Table 4D (1). As this amount shown in Table 4D (1) would not automatically get credited in the Electronic Credit Ledger, such reclaimed credit has to be shown in Table 4A (5) also.

Other circumstances in which such reclaim of credit would arise are, (i) inward supply is reflecting in GSTR 2B and hence included in Table 4A, but the goods and services have not yet been received; and (ii) inward supply is reflecting in GSTR 2B and hence included in Table 4A, but the supplier has not paid the taxes. These ineligible ITCs have to be reversed through Table 4B (2), As and when these ITC become eligible, they have to be shown in table 4D (1) and also in Table 4A (5).

In the newly introduced Table 4D (2), the details of credit which are not eligible due to lapse of time under Section 16 (4) and ineligible credits (CGST and SGST) on account of place of supply being different State have to be shown. These details would not form part of Table 4A.

The following example may be seen.

S.No	Details for July 2022	IGST	CGST	SGST
1	ITC in import of goods	100000	-	-
2	ITC on import of Services	50000	-	-
3	ITC on inward supplies under RCM	-	25000	25000
4	ITC on inward supplies from ISD	50000	-	-
5	ITC on other supplies as per GSTR 2B	200000	150000	150000
6	Ineligible ITC under Section 17(5) (reflected in GSTR 2B)	50000	-	-
7	Reversal under Rule 42 and 43	75500	52000	52000
8	Reversal of ITC on account of non- payment to suppliers within 180 days	-	500	500
9	Ineligible ITC on account of limitation of time period as delineated under Section 16(4) (i.e. ITC pertaining to FY 20-21, reflected in GSTR 2B of July 2022)	-	10000	10000

The above information have to be reported in Table 4 as below.

Details	Integrated Tax	Central Tax	State/ UT Tax	Cess
1	2	3	4	5
(A) ITC Available (whether in full or part)
(1) Import of goods	100000
(2) Import of services	50000
(3) Inward supplies liable to reverse charge (other than 1 & 2 above)		25000	25000
(4) Inward supplies from ISD	50000
(5) All other ITC	200000	150000	150000
(B) ITC Reversed
(1) As per rules 42 & 43 of CGST Rules As per rules 38, 42 and 43 of CGST Rules and sub-section (5) of section 17	50000+75500	52000	52000
(2) Others		500	500
(C) Net ITC Available (A) – (B)
(D) Ineligible ITC Other Details
(1) As per section 17(5) ITC reclaimed which was reversed under Table 4(B)(2) in earlier tax period	Blocked credit will not be disclosed here. It has to be first shown in all other ITC [4(A)(5)] and then reversed in Table 4(B)(1)
(2) Others Ineligible ITC under section 16(4) and ITC restricted due to Place of Supply provisions		10000	10000

Another crucial question is whether the new formats would be available for filing June 2022 GSTR 3 B itself or only from July 2022 GSTR 3 B?

- Shri G. Natarajan, Advocate, G N Law Associates