52nd GST Council Meeting

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Confidential


Agenda for
52nd GST Council Meeting
07th October, 2023

Volume-I





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Agenda for 52nd GSTCM Volume 1
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GST Council Secretariat New Delhi
5th Floor, Tower-II, Jeevan Bharti Building, New Delhi
25th September, 2023

OFFICE MEMORANDUM
Subject: Notice for the 52nd Meeting of the GST Council scheduled to be held on 7th
October, 2023.

The undersigned is directed to refer to the subject stated above and to convey that the 52nd
Meeting of the GST Council will be held on 7th October, 2023 at Delhi. The schedule of the
Meeting is as follows:
• Saturday, 7th October, 2023 : 10:00 A.M. onwards
2. In addition, an Officers' Meeting will be held on 6th October, 2023 at
NDMC Convention Centre, Sansad Marg, New Delhi as per the following schedule:
• Friday, 6th October, 2023 : 02:30 P.M. onwards
3. The agenda items and other details for the 52nd Meeting of the GST Council will be
communicated in due course of time.

4. Kindly convey the invitation to the Hon’ble Member of the GST Council to attend the 52nd
Meeting of the GST Council.

Sd/-
(Sanjay Malhotra)
Secretary to the Govt. of India and ex-officio Secretary to the GST Council
Tel: 011 23092653

Copy to:
1. PS to the Hon’ble Minister of Finance, Government of India, North Block, New Delhi with
the request to brief Hon’ble Minister about the above said meeting.
2. PS to the Hon’ble Minister of State (Finance), Government of India, North Block, New
Delhi with the request to brief Hon’ble Minister about the above said meeting.
3. The Chief Secretaries of all the State Governments, Union Territories of Delhi, Puducherry
and Jammu and Kashmir with the request to intimate the Minister in charge of
Finance/Taxation or any other Minister nominated by the State Government as a Member of
the GST Council about the above said meeting.
4. Chairman, CBIC, North Block, New Delhi, as a permanent invitee to the proceeding of the
Council.
5. CEO, GST Network
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TABLE OF CONTENTS
Sl. No. Agenda Item Page No.
Confirmation of Minutes of GST Council Meetings:
i. 50th GST Council Meeting held on 11th July, 2023 7-177
ii. 51st GST Council Meeting held on 2nd August,2023 178-219
Ratification of the Notifications, Circulars and Orders issued by the GST Council
and decisions of GST Implementation Committee for the information of the
Council
220-242
Issues recommended by the Law Committee for the consideration of the GST
Council
i. Alignment of provisions of the CGST Act, 2017 with the provisions of
the Tribunal Reforms Act, 2021 in respect of Appointment of President
and Member of the proposed GST Appellate Tribunals.
243-245
ii. Seeking clarity on various issues
A. Regarding taxability of personal guarantee offered by directors to
the bank against the credit limits/loans being sanctioned to the
company.
246-250
B. Regarding taxability of corporate guarantee provided for related
persons including corporate guarantee provided by holding company
to its subsidiary company.
250-257
iii. Providing a special procedure for condonation of delay in filing of
appeals against demand orders passed until 31st March, 2023.
258-262
iv. Law amendment w.r.t. ISD as recommended by the GST Council in its
50th meeting
263-267
v. Clarification regarding restoration of provisionally attached property 268-272
vi. Clarification on various issues related to Place of Supply 273-282
vii. Agenda Note for issuance of clarification relating to export of services-
condition (iv) of the Section 2 (6) of the IGST Act 2017
283-288
viii. Amendment in Central Goods and Services Tax Rules, 2017 and GST
REG/PCT – FORM(s)
A. Incorporation of ‘One Person Company’ in FORM GST REG 01 i.e.
Application for Registration
289-290
B. Application for Enrolment as Goods and Services Tax Practitioner-
Amendment in FORM GST PCT-01
291-293
C. Application for cancellation of TCS and TDS registration-
Enhancement in Form GST REG-08 format for having options for
294-296
1.
2.
3.
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cancellation of registration against the request made by the TDS and
TCS registered persons
D. Amendment in rule 142 (3) of CGST Rules with respect to FORM
GST DRC-05
297-297
E. Amendment in FORM GSTR-8 to include late fee 298-302
ix. Clarification on the scope of the refund on account of inverted duty
structure in respect of supplies of certain construction services
303-308
Recommendations of the Fitment Committee for the consideration of the GST
Council
a) Recommendations made by the Fitment Committee for making changes in
GST rates or for issuing clarifications in relation to goods – Annexure-I
309-314
b) Issues where no change has been proposed by the Fitment Committee in
relation to goods – Annexure-II
315-319
c) Issues deferred by the Fitment Committee for further examination in relation
to goods – Annexure-III
320-323
d) Recommendations made by the Fitment Committee for making changes in
GST rates or for issuing clarifications in relation to services – Annexure-IV
324-339
e) Issues where no change has been proposed by the Fitment Committee in
relation to services – Annexure-V
340-350
f) Issues deferred by the Fitment Committee for further examination in relation
to services – Annexure-VI
351-387
Performance Report of Competition Commission of India (CCI) for
1st quarter of the F.Y 2023-24 along with Performance Reports of State Level
Screening Committee (SLSC), Standing Committee (SC) and Directorate
General of Anti-Profiteering (DGAP).
388-389
4.
(Part- I)
5.
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Discussion on Agenda Items
Agenda Item 1: Confirmation of the Minutes of the GST Council Meetings

Agenda Item 1(i): Confirmation of the Minutes of the 50th GST Council Meeting held on 11th
July, 2023
The 50th meeting of the GST Council was held on 11th July, 2023 under the Chairpersonship of
the Hon’ble Union Finance Minister, Smt. Nirmala Sitharaman at Vigyan Bhawan, New Delhi. The list
of Hon’ble Members of the Council who attended the meeting is at Annexure-1. The list of the officers
of the Centre, States, Union Territories with legislature, GST Council Secretariat and GSTN who
attended the meeting is at Annexure-2.
1.2 The following agenda items were listed for discussion in the 50th meeting of the GST Council:

TABLE OF CONTENTS
Sl. No. Agenda Item
1. Confirmation of Minutes of 49th GST Council Meeting held on 18th February, 2023
2. Ratification of the Notifications, Circulars and Orders issued by the GST Council and
decisions of GST Implementation Committee for the information of the Council
3.
Issues recommended by the Law Committee for the consideration of the GST
Council
i. Rules Amendment in accordance with the recommendations made by Group
of Ministers (GoM) on implementation of E-way bill requirement for
movement of Gold/ Precious stones under chapter 71.
ii. Capacity based taxation and Special Composition Scheme in certain Sectors
in GST.
iii. Clarification on charging of interest under section 50(3) of the CGST Act,
2017, in cases of wrong availment of IGST credit and reversal thereof
iv. Issues pertaining to interpretation of Section 10 of IGST Act, 2017
v. Clarification with respect to applicability of e-invoice w.r.t. supplies made
by a registered person to Government Departments or establishment/
Government agencies / local authorities/ PSUs registered solely for the
purpose of TDS
vi. Clarification on refund related issues
vii. Clarification to deal with difference in Input Tax Credit (ITC) availed in
FORM GSTR-3B as compared to that detailed in FORM GSTR-2A for the
period 01.04.2019 to 31.12.2021
viii. Mechanism to deal with differences in ITC between GSTR-2B and GSTR-
3B, along with draft rules and proposed FORM DRC-01C for implementing
the same
ix. Procedure for Recovery of Tax and Interest in terms of Rule 88C(3)
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x. Annual Returns for FY 2022-23
xi. Amendment in CGST Rules, 2017 regarding registration
xi(a) Pilot Project for biometric-based Aadhaar authentication of
registration applicants in Puducherry
xii. Clarification on TCS liability under Sec 52 of the CGST Act, 2017, in case
of multiple E-commerce Operators (ECOs) in one transaction
xiii. Clarification on availability of ITC in respect of warranty replacement of
parts and repair services during warranty period
xiv. Amendments in CGST Rules consequent to amendment in CGST Act vide
Finance Act 2023
xv. Goods and Services Tax Appellate Tribunal (Appointment and Conditions
of Service of President and Members) Rules, 2019
xvi. Seeking clarity on taxability of share capital held in subsidiary company by
the parent company
xvii. Amendment in CGST Rules, 2017
xviii. Proposal to provide a special procedure to file appeal against the orders
passed in accordance with the Circular No. 182/14/2022-GST, dated
10.11.2022, pursuant to the directions issued by the Hon’ble Supreme Court
in the Union of India v/s Filco Trade Centre Pvt. Ltd.
xix. Issues pertaining to ISD mechanism and taxability of services provided by
one distinct person to another distinct person
4.
Recommendations of the Fitment Committee for the consideration of the GST
Council
a) Recommendations made by the Fitment Committee for making changes in GST
rates or for issuing clarifications in relation to goods – Annexure-I
b) Issues where no change has been proposed by the Fitment Committee in relation
to goods – Annexure-II
c) Issues deferred by the Fitment Committee for further examination in relation to
goods – Annexure-III
d) Recommendations made by the Fitment Committee for making changes in GST
rates or for issuing clarifications in relation to services – Annexure-IV
e) Issues where no change has been proposed by the Fitment Committee in relation
to services – Annexure-V
f) Issues deferred by the Fitment Committee for further examination in relation to
services – Annexure-VI
g) Recommendations of Fitment Committee on positive list of services to be
specified in Sr. No. 3/3A of Notification No. 12/2017-CT(R)) dated 28.06.201
5. Second Report of the Group of Ministers (GoM) on Casinos, Race Courses and
Online Gaming
6.
Recommendations of the 18th & 19th IT Grievance Redressal Committee for
approval/decision of the GST Council
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1.3 The Secretary to the GST Council, welcomed all the Hon’ble Members of the Council and
participating officers to the landmark 50th meeting of the GST Council.
1.4 The Secretary on behalf of the Council welcomed the following incoming Hon’ble Members to
the 50th Meeting of the GST Council-
a. Ms. Atishi Marlena, Finance Minister, Delhi
b. Shri Krishna Byre Gowda, Minister for Revenue Department, Karnataka
c. Sh. Sudhir Mungantiwar, Hon’ble Minister of Forests, Maharashtra
d. Shri A. T. Mondal, Cabinet Minister, Community and Rural Development,
Power and Taxation Departments, Meghalaya
e. Shri K. G. Kenye, Minister for Power and Parliament Affairs, Nagaland
f. Shri Bikram Keshari Arukha, Minister for Finance, Odisha
g. Shri Thangam Thennarasu, Minister for Finance and Human Resource
Management, Tamil Nadu
a. Decisions/recommendations of the 18th meeting of the ITGRC
b. Decisions/recommendations of the 19th meeting of the ITGRC
7. Scheme of budgetary support under GST regime in lieu of earlier excise duty
exemption schemes to eligible manufacturing units under different Industrial
Promotion Schemes of the Government of India
8. Ad-hoc Exemptions Orders issued under Section 25(2) of the Customs Act, 1962 to
be placed before the GST Council for information.
9. Report of 3rd Meeting of the Group of Ministers (GoM) on GST System Reforms
10. Proposal for creation of State Co-ordination Committee comprising of the GST
authorities from the State and the Central Tax Administrations
11. Implementation of GSTAT consequent to passing of Finance Act, 2023
11.
(Addendum)
Addendum to Annexure-A of the Agenda item 11
12. Performance Report of Competition Commission of India (CCI) for month of
December, 2022 and 4th quarter of the F.Y 2022-23 along with Performance Reports
of State Level Screening Committee (SLSC), Standing Committee (SC) and
Directorate General of Anti-Profiteering (DGAP) for 3rd quarter and 4th quarter of
the F.Y 2022-23.
13 Request for extension of due dates for filing GSTR-7, GSTR-1 & GSTR-3B for the
months of April, May and June 2023 and extension of Amnesty Schemes in the State
of Manipur
14. Review of revenue position under Goods and Services Tax
15. Any other agenda with the permission of the Chair
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1.5 The Secretary informed the Council that a short film titled ‘GST Council: 50 steps towards
a journey’ has been prepared by GST Council Secretariat in collaboration with Directorate General of
Taxpayer Services, CBIC. The film was screened with the permission of the Hon’ble Chairperson. The
Secretary informed that the film has been prepared in Hindi, English and various regional languages.
1.6 Further, the first set of a special postal cover and customized my stamp designed by the GST
Council Secretariat through Department of Posts was presented by Smt. Manju Kumar, Chief Post
Master General (CPMG), Delhi to the Hon’ble Chairperson of the GST Council to mark the occasion.
All Hon’ble Members joined the release ceremony. The Secretary thanked the CPMG, Delhi and her
team.
1.7 The Secretary stated that a GoM on Casinos, Race Courses and Online Gaming was formed to
examine the issue of valuation of services and related aspects with Sh. Conrad Sangma, Hon’ble Chief
Minister, Meghalaya as Convenor and Hon’ble Members from Maharashtra, West Bengal, Gujarat,
Goa, Tamil Nadu, Uttar Pradesh and Telangana as Members. The GoM had submitted its 2nd report
which was being placed before the Council for deliberations. He thanked all the Hon’ble Members of
this GoM for their valuable recommendations.

1.8 The Secretary further stated that the GoM on GST System Reforms had submitted the report of
its third meeting which was being placed before the Council for deliberations. He thanked the Hon’ble
Convenor of this GoM from Maharashtra and other Hon’ble Members of this GoM from Haryana,
Delhi, Assam, Andhra Pradesh, Odisha, Tamil Nadu and Chhattisgarh.

1.9 The Secretary informed the Council that a National Coordination Meeting was held on 24th
April, 2023 with the officers from Center, States, Union Territories, GST Council Secretariat and GSTN
wherein various issues on greater coordination on GST administration and sharing of best practices by
both Center and states were discussed. The agenda of this meeting involved greater use of technology
for GST compliance and tackling tax evasion. One of the outcomes of this meeting was All India drive
against fake registrations from 16th May, 2023 to 15th July, 2023. The coordinated effort from both
Central and State GST administrations had yielded excellent results. He appreciated the outstanding
efforts and excellent performance of both the State and Central GST officers.

1.10 The Secretary also appreciated the efforts of the State and Central GST administrations in
revenue augmentation as the revenue in first quarter of 2023-24 was 12 % higher than the revenue in
same period for 2022-23.

1.11 The Secretary informed that the agenda for the 50th meeting of the GST Council was discussed
in detail during the Officers Meeting a day before which would help immensely in steering the agenda
today.

1.12 The Secretary sought the permission of the chair to begin deliberations on each agenda item.
2. Agenda Item 1: Confirmation of the Minutes of the 49th Meeting of the GST Council
2.1 The first agenda item pertained to confirmation of the minutes of the 49th Meeting of the GST
Council which was held on 18th February, 2023 at New Delhi. The Secretary stated that the minutes
were circulated to all Hon’ble Members and suggestions were received from States of Haryana and
Tamil Nadu. The minutes of the 49th meeting of the GST Council after incorporating the changes
suggested by the States were placed before the Council for confirmation.
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2.2 The Hon’ble Member from Tamil Nadu stated that the suggestions made by the former Finance
Minister of Tamil Nadu during the last meeting have not been incorporated. In regard to selection of
Technical Members for GSTAT Benches, the States should be taken into account keeping in view the
spirit of federalism. The State Search-cum-Selection Committee should be empowered to select both
the Judicial Members and Technical Members of the State Bench. The present system will pose a
herculean task for the Centre. The Secretary clarified that the agenda item was discussed in detail, and
it was agreed that a draft would be prepared by the Secretariat and circulated. The Chairperson was
authorized to take a final view. The minutes have been recorded accordingly. Action was also taken
accordingly – a draft law was prepared, it was circulated, comments received and incorporated and then
approval of the Chairperson taken. The final draft Act has also been circulated to States, based on which
they have taken actions such as passing the State Act. The Hon’ble Member from the State of Tamil
Nadu reiterated that the State Search-cum-Selection Committee should be empowered for selection of
both the Judicial Members and Technical Members of the State Bench. The Secretary stated that the
same would be recorded. He requested that minutes be approved.

Decision: The Council adopted the Minutes of the 49th meeting of the GST Council.
3. Agenda item 2: Ratification of the Notifications, Circulars and Orders issued by the GST
Council and decisions of GST Implementation Committee for the information of the Council
3.1 The Secretary took up the next agenda pertaining to the Ratification of the Notifications,
Circulars and Orders issued by the GST Council and decisions of GST Implementation Committee for
the information of the Council (Page 92-104 of the agenda). He stated that this agenda was discussed
in the officers meeting held yesterday and there was consensus. He requested the Council to ratify the
Notifications, Circulars and Orders issued by the GST Council and take note of the decisions of the
GST Implementation Committee (GIC).

Decision: The Council ratified the Notifications, Circulars and Orders issued by the GST Council
and took note of the decisions of GST Implementation Committee.
4. Agenda Item 3: Issues recommended by the Law Committee for the consideration of the GST
Council
4.1 The Secretary took up the next Agenda for the consideration of the GST Council. He informed
that these agendas were discussed in the Officers’ Meeting held on 10th July, 2023 and there was an
agreement among the all officers on most of the issues. Then, the Principal Commissioner, GST Policy
Wing made the detailed presentation (attached as Annexure-3) giving overview of the
recommendations made by the Law Committee, as well as the gist of the discussions held in the
Officers’ meeting on 10th July 2023.
Agenda Item 3(i): Rules Amendment in accordance with the recommendations made by Group
of Ministers (GoM) on implementation of E-way bill requirement for movement of Gold/ Precious
stones under Chapter 71
4.2 Pr. Commissioner, GST Policy informed that the as per the recommendation of GoM regarding
amendment in Rules for implementation of E-Way Bill requirement for movement of Gold/Precious
stones, Law Committee has recommended insertion of Rule 138F in the CGST Rules 2017 as well as
in SGST Rules, 2017 for those States who want to mandate the requirement of e-way bill for intra-state
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Movement of gold and precious stones under Chapter 71 as specified at Sl. No. 4 and 5 of the Annexure
appended to sub rule 14 of Rule 138. He also mentioned that this was agreed to in the Officers’ meeting.
Decision: The Council agreed with the recommendations of the Law Committee along with the
proposed amendments in CGST Rules, 2017 and in concerned SGST Rules, 2017.
Agenda Item 3(ii): Capacity based taxation and Special Composition Scheme in certain Sectors
in GST
4.3 Pr. Commissioner, GST Policy informed that for implementation of the recommendations made
by GoM on Capacity based taxation and Special Composition Scheme in certain Sectors, Law
Committee has proposed to notify special procedure under section 148 of the CGST Act, 2017 to be
followed by the manufacturers of commodities recommended by GoM for registration of the machines,
maintenance of records of inputs and production, and submission of special monthly statement. Law
Committee has also recommended insertion of Section 122A in CGST Act, 2017 to provide for penalty
for non-declaration of machines by such manufacturers.
4.4 Law Committee further recommended that the amendment made to Section 16 of IGST Act,
2017 through the Section 123 of the Finance Act, 2021 may be notified for restricting the IGST Refund
route in respect of certain supplies or suppliers for exports. Further, tobacco, pan masala and similar
items (as recommended by GoM) and mentha oil may be notified under section 16(4) of IGST Act,
2017 as the goods, on the export of which IGST refund route will not be available.
4.5 He also mentioned that this was discussed in Officers’ meeting and was agreed to. Officers also
suggested 01.10.2023 as the date from which the provisions of Section 123 of the Finance Act, 2021
may be brought into effect.
Decision: The Council agreed with the recommendations of the Law Committee detailed along
with the proposed notification and amendments in CGST Act, 2017 and IGST Act, 2017 and
recommended to bring the provisions of Section 123 of the Finance Act, 2021 into effect from
01.10.2023.
Agenda Item 3(iii) Clarification on charging of interest under section 50(3) of the CGST Act,
2017, in cases of wrong availment of IGST credit and reversal thereof
4.6 Pr. Commissioner, GST Policy informed that Law Committee has proposed a circular to clarify
that in the cases where IGST credit has been wrongly availed and subsequently reversed on a certain
date, there will not be any interest liability under Section 50(3) of the CGST Act, if during the time
period starting from such availment and upto such reversal, the balance Input Tax Credit in the
electronic credit ledger of IGST, CGST and SGST taken together, has not fallen below the amount of
such wrongly availed credit. However, if the balance of the electronic credit ledger in IGST, SGST and
CGST taken together falls below such wrongly availed IGST credit, then it would amount to utilisation
of the wrongly availed IGST credit and will attract interest as per section 50(3) of the CGST Act read
with Section 20 of the IGST Act and Rule 88B(3) of the CGST Rules. Law Committee has proposed to
clarify the same through a circular.
Decision: The Council agreed with the recommendations of the Law Committee as detailed in the
agenda along with the proposed Circular.

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Agenda Item 3(iv) issues pertaining to interpretation of Section 10 of IGST Act, 2017
4.7 Pr. Commissioner, GST Policy informed that agenda pertains to clarification regarding the
interpretation of Section 10 of the IGST Act for determining the Place of Supply (PoS) in case of goods
purchased Over-the-Counter in one State and thereafter transported to another State by the recipient.
The issue was discussed in the 37th GST Council Meeting but it was referred back to Law Committee
for further deliberation. The Law Committee, after obtaining the opinion of the States, has proposed an
amendment in Section 10 of IGST Act for supplies made to unregistered persons, broadly considering
the destination-based principle. The recommendation was agreed to in the officer’s meeting.
4.8 The Hon’ble Member from Tamil Nadu suggested that place of supply should be place of
supplier citing examples of migrant workers and others who come to the State to purchase something
and if they mention the address from where they are coming, then revenue will go to that State where
these migrant workers and tourists come from, and hence their State would be deprived of the Revenue.
4.9 The Secretary mentioned that decision has to be taken by the Council. Migration happens either
way and people travel in and out of the States. There are disputes about PoS in such over-the-counter
supplies. He also informed that the issue came up especially with regard to automobile sector in which
residents of a State may travel to another State to take advantage of lower registration charges and road
tax, which vary from State to State. To resolve this issue, Law Committee has recommended a new
formulation where the unregistered consumers could declare their address on the tax invoice, which
would determine the PoS for the said supply. In cases of in-migration, the State may gain but in out-
migration it would lose. It is a zero-sum gain. Other than for major goods like automobiles, consumers
will not mention their address. So, overall, the losses and gains would not be substantial.
4.10 The Hon’ble Member from Himachal Pradesh thanked the Chairperson stating that the said
amendment would benefit smaller States which have very limited resources and that consumer State
would get the revenue as per the principle of destination-based taxation.
Decision: The Council agreed with the recommendations of the Law Committee along with
proposed amendments.
Agenda Item 3(v) Clarification with respect to applicability of e-invoice w.r.t supplies made by a
registered person to Government Departments or establishment/ Government agencies / local
authorities/ PSUs registered solely for the purpose of TDS.
4.11 Pr. Commissioner, GST Policy informed that Law Committee has recommended to clarify
through a circular that e-invoicing would be required in all such supplies made by the registered persons,
whose turnover exceeds the prescribed threshold for generating e-invoices under Rule 48(4) of the
CGST Rules, to the Government Departments or establishment/ Government agencies / local
authorities/ PSUs who are registered solely for the purpose of tax deduction at Source under section 51
of the CGST Act, 2017. He added that this was agreed to in the Officers’ meeting.
Decision: The Council agreed with the recommendations of the Law Committee along with
proposed circular for clarification.
Agenda Item 3(vi) Clarification on refund related issues
4.12 Pr. Commissioner, GST Policy further stated that the next agenda is regarding clarification on
various refund related issues.
4.13 Issue no 1: Refund of accumulated input tax credit (ITC) under Section 54(3) on the basis of
that available as per FORM GSTR 2B.
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4.14 Pr. Commissioner, GST Policy informed that since the availment of ITC has now been linked
with FORM GSTR-2B w.e.f. 01.01.2022, Law Committee has recommended that the availability of
refund under Section 54(3) of the CGST Act also needs to be restricted to those invoices which are
reflected in FORM GSTR-2B for the concerned or earlier tax periods and on which ITC is available to
the applicant. Corresponding amendments have been proposed in the Circular No 135/05/2020-GST
dated 31.03.2020 and Circular No.139/09/2020-GST dated 10.06.2020 which would be applicable for
refund claims for the tax period January, 2022 onwards.
Decision: The Council agreed with the recommendations of the Law Committee for issuing the
said clarification.
4.15 Issue No 2: Requirement of the undertaking in FORM RFD 01 inserted vide Circular No.
125/44/2019- GST dated 18.11.2019
4.16 Pr. Commissioner, GST Policy informed that Law Committee has recommended that in view of
the omission of Section 42 of the CGST Act, amendment in Section 41 of the CGST Act and omission
of Form GSTR-2 and GSTR-3 from the CGST Rules, 2017, para 7 of the Circular No 125/44/2019
dated 18.11.2019 and its Annexure A are required to be modified to omit the references to the said
Section and Rules.
Decision: The Council agreed with the recommendations of the Law Committee for making
necessary modifications in the above circular and the Annexure A to the said circular.
4.17 Issue No3: Clarification regarding determination of value of adjusted total turnover in the
formula under Rule 89(4)-
4.18 Pr. Commissioner, GST Policy informed that Law Committee has recommended to clarify
through the circular that consequent to the Explanation having been inserted in sub -rule (4) of rule 89
of the CGST Rules vide Notification No. 14/2022-CT dated 5.7.2022, the value of goods exports to be
included in the calculation of the adjusted Total turnover shall be the same as per the said explanation.
Decision: The Council agreed with the recommendations of the Law Committee, along with the
Circular.
4.19 Issue No 4: Clarification on the scope and computation of the refund on account of inverted
duty structure as provided in sub-section (3) of section 54 and in rule 89 (5) of the CGST Rules, 2017:
4.20 Pr. Commissioner, GST Policy informed that Law Committee has recommended that
clarification be given regarding refund of accumulated input tax credit in cases of inverted duty structure
in respect of items like fertilizers, where subsidy is given by the government. Law Committee has
recommended that refund will be available in all such cases as long as there is some inversion of tax
rate irrespective of the fact that accumulation of input tax credit may also be on account of taxable value
of output supply being lower than the value of inputs because of subsidy. Law Committee also
recommended that refund be calculated as per the formula prescribed under rule 89(5) of CGST Rules,
2017.
4.21 The Hon’ble Member from Karnataka stated that he had reservations on the recommendation of
Law Committee on account of Law and adverse Revenue implications in the State. He further informed
that matter is under litigation between their State and concerned companies. He insisted that since the
matter is sub-judice, it would not be advisable to take the decision at this stage. He therefore suggested
that Council may await the order of the Court on the issue as it would have huge revenue implication
of around Rs 300-500 Crore for the State. However, if the Council strongly felt that a decision needs to
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be taken on the issue, then the law could be required to be amended and it may not be clarified by
issuance of a circular.
4.22 The Secretary suggested that the Council may either refer the matter back to Law Committee or
it could be approved so that all authorities actually take a uniform view. He reiterated that it is only a
recommendation for the Council to decide but things should not be kept pending for clarification.
4.23 The Hon’ble Chairperson, sought the opinion of the house on the suggestions made by Revenue
Secretary
4.24 The Hon’ble Minister of Karnataka agreed to the proposition suggested by the Revenue
Secretary.
4.25 The Hon’ble Member from Uttar Pradesh questioned the wisdom of taking a decision on a matter
that is already sub-judice. Revenue Secretary informed that though the matter is sub-judice but since it
is not stayed, the issue could be decided.
4.26 The Hon’ble Member from Goa mentioned that if the Council waits for the Court orders, then
the matter would remain pending. He requested that the issue needs to be clarified at the earliest and
therefore, may be referred back to the Law Committee.
4.27 The Hon’ble Member from Chhattisgarh did not agree to the recommendation of Law
Committee and stressed that Law Committee should be advised to follow the spirit of legislature and
not recommend anything contrary to the provisions of the Act.
4.28 The Hon’ble Member from Meghalaya stated that the reason of litigation is due to lack of clarity
in the Law and therefore, Council should not wait for the decision of the Court. He added that the
Council should interpret the law and if needed, the Act should be amended for bringing more clarity.
He further agreed to the concern raised by Hon’ble Member from Goa.
4.29 The Hon’ble Chairperson directed that in all such cases, where there is lack of clarity in the law,
the Law Committee should come up with clarificatory note in time to avoid matter going to the Courts.
Decision: The Council agreed that the issue may be referred back to the Law Committee for re-
examination of the same based on the provisions of the law, and after taking inputs from State of
Karnataka also.
4.30 Issue No 5: Clarification in respect of admissibility of refund where an exporter applies for
refund subsequent to compliance of the provisions of sub-rule (1) of rule 96A.
4.31 Pr. Commissioner, GST Policy explained that the issue pertains to giving the benefit of zero
rating in cases where the goods are actually exported or the payment is realised in case of export of
services, even if it is beyond the time frame prescribed under rule 96A(1) (a) or 96A(1)(b) of CGST
Rules. Law Committee has recommended to clarify through the circular that in such cases, subsequent
to the export of goods or realisation of payment in case of export of services, as the case may be, the
said exporters would be entitled to refund of the tax paid earlier. The refund may be claimed under
“excess payment of tax” and till that functionality is available on the portal, it may be under the category
“Any Other”. However, no refund of interest would be given in such cases.
Decision: The Council agreed with the recommendations of the Law Committee along with
proposed circular as detailed in the agenda.
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Agenda Item 3(vii): Clarification to deal with difference in Input Tax Credit (ITC) availed in
FORM GSTR-3B as compared to that detailed in FORM GSTR-2A for the period 01.04.2019 to
31.12.2022.
4.32 Pr. Commissioner, GST Policy informed that guidelines were issued on manner of reconciliation
of the difference in ITC availed in FORM GSTR-3B as compared to that detailed in FORM GSTR-2A
for the period 2017-18 and 2018-2019 consequent to the decision of the Council in the 48th GST Council
Meeting. However, after that, representations have been received for clarification to deal with the
difference in ITC availed in FORM GSTR-3B as compared to that detailed in FORM GSTR-2A for the
period 01.04.2019 to 31.12.2021. Since rule 36(4) of the CGST rules allowed additional credit to the
tune of 20%, 10% and 5% of the eligible credit available in GSTR-2A during the period 9.10.19 to
31.12.19, 1.1.20 to 31.12.20 and 1.1.21 to 31.12.21 respectively, subject to payment of tax by the
supplier, therefore, the guidelines are proposed by the Law Committee to be issued for manner of
verification and reconciliation of the difference in ITC for the period 01.04.2019 to 31.12.2021 also.
The guidelines recommended by the Law Committee in form of a circular were agreed to in the Officers’
Meeting.
Decision: The Council agreed with the recommendations of the Law Committee along with
proposed circular as detailed in the agenda.
Agenda Item 3(viii): Mechanism to deal with differences in ITC between GSTR-2B and GSTR-
3B, along with draft rules and proposed FORM DRC-01C for implementing the same.
4.33 Pr. Commissioner, GST Policy informed that a mechanism is being devised which would allow
system-based intimation to the taxpayer about the excess availment of ITC in FORM GSTR-3B vis-a-
vis that reported in FORM GSTR-2B, above a particular threshold and with provision for self-
compliance on the portal by the said taxpayer. Accordingly, certain amendments in Rules and Forms
are required for devising such mechanism. He further, informed that Law Committee has recommended
that Rule 88D may be inserted in the CGST Rules to give a system-based intimation to the registered
person in those case where difference between the ITC availed as per Form GSTR-3B and that available
as per Form GSTR-2B exceeds such amount and such percentage as may be recommended by the
Council. In such cases, the registered person shall be directed to pay an amount equal to the said excess
amount of ITC availed along with interest or to give a reasonable explanation and if neither of these is
done, then the amount can be demanded under Section 73 or section 74. Further, a new clause (e) has
been recommended to be inserted in sub-rule 59(6) of CGST Rules to block subsequent GSTR-1 or IFF,
unless the said amount has been paid or the requisite explanation has been furnished.
4.34 Law Committee has also recommended to insert a new FORM GST DRC-01C in CGST Rules
as required under sub-rule (1) of the proposed rule 88D.
4.35 Law Committee further recommended that to begin with, such intimation may be given in those
cases to the concerned registered person under proposed rule 88D where the difference between the
input tax credit availed in FORM GSTR-3B & that available as per FORM GSTR-2B is more than 20%
as well as more than Rs. 25 lakhs.
4.36 Pr. Commissioner added that this was discussed in Officers’ meeting and was agreed to.
4.37 The Hon’ble Member from Tamil Nadu suggested that only one criteria of more than Rs 25 lakh
should be adopted. Revenue Secretary clarified that it is only the beginning and based on the
experience, the threshold could be changed or reduced at later stage. Otherwise, it may cause massive
disruption in the business.
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The Council agreed with the recommendations of the Law Committee along with proposed rule
and proposed FORM DRC-01C.
Agenda Item 3(ix): Procedure for Recovery of Tax and Interest in terms of Rule 88C(3).
4.38 Pr. Commissioner, GST Policy informed that in cases where the output tax liability reported in
Form GSTR-1 exceeds the output tax liability reported in GSTR-3B and has been communicated to
the taxpayer but the amount has either not been paid fully/partially or satisfactory explanation of the
difference has not been not given by the taxpayer, or where interest has not been paid by the
taxpayer, then, a procedure has been recommended by the Law Committee in those cases for creation
of the liability in Electronic Liability Ledger and for recovery of this differential amount by insertion
of new rule 142B and a new Form DRC-01D. He added that in the Officers’ meeting, officer from the
State of Gujarat proposed that words “or interest” may be inserted in proposed sub-rule (3) of rule 142B
after the words “tax”, which was agreed to by the Officers.
Decision: The Council agreed with the recommendations of the Law Committee, with the
amendment proposed by the State of Gujarat, along with proposed rules.
Agenda Item 3(x): Annual Returns for FY 2022-23
4.39 Pr. Commissioner, GST Policy informed that for filing Annual Return for FY 2022-23, last date
of filing is 31.12.2023 and accordingly, FORM GSTR-9 and FORM GSTR-9C for FY 2022-23 need to
be notified. Law Committee recommended that the relaxations provided in FY 2021-22 in respect of
various tables of FORM GSTR-9 and FORM GSTR-9C may be continued for FY 2022-23. Law
Committee also recommended to insert separate rows for the newly introduced tax rate of 6% (for brick
kilns) in table 9, 11 and Pt. V of FORM GSTR-9C. Law Committee further recommended that the filing
of annual return (in FORM GSTR-9/9A) for the FY 2022-23 may be exempted for taxpayers having
aggregate annual turnover upto two crore rupees, as per the relaxation extended in previous FYs.
Decision: The Council agreed with the recommendations of the Law Committee, along with draft
notification detailed in the agenda note.
Agenda 3 (xi)- Amendment in CGST Rules, 2017 regarding registration
4.40 Pr. Commissioner, GST Policy informed that the next agenda 3(xi) is regarding the amendments
in CGST Rules 2017 pertaining to registration. He stated that a significant number of cases have been
detected where unscrupulous elements have misutilized the facility of registration to take fake
registration. He mentioned that Law Committee deliberated on the issue and has recommend
amendments in various provisions of CGST Rules to strengthen the registration process in GST.
4.41 Amendment in rule 10A: Law Committee has proposed that rule 10A of CGST Rules may be
amended to provide that the details of bank account may be required to be furnished within 30 days of
the grant of the registration or before filing of statement of outwards supply under section 37 of CGST
Act in FORM GSTR-1/ IFF, whichever is earlier.
4.42 Amendment to sub-rule (2A) of rule 21A: Further, Law Committee has proposed that
amendment be made in Rule 21A(2A) to provide for system based suspension of the registration in
respect of such registered persons who do not furnish details of valid bank account under rule 10A of
CGST Rules within the time period prescribed in the said rule. It has also been recommended to provide
for automatic revocation of suspension in such cases upon compliance with provisions of rule 10A.
4.43 Amendment to sub-rule (6) of rule 59: Law Committee has further recommended that clause
(e) may be inserted in sub-rule (6) of rule 59 to provide that in cases where a registered person has not
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furnished details of a valid bank account under rule 10A as per provisions of rule 10A, the said
registered person may not be allowed to furnish the details of outward supplies in FORM GSTR-1 or
using IFF.
4.44 Amendment in CGST Rules regarding physical verification of business premises: The Law
Committee also deliberated that the physical verification of business premises needs strengthening in
high risk cases. The Law Committee recommended that the requirement of the presence of the applicant
for physical verification of business premises may be done away with Further, Law Committee also
recommended to make a provision in rule 25 for physical verification in high-risk cases even where
Aadhaar has been authenticated. For this purpose, Rule 9(1) and Rule 25 may be amended as proposed
in the Agenda.
4.45 Pr. Commissioner added that this was discussed in Officers’ meeting and was agreed to.
Decision: The Council agreed with the said recommendations of the Law Committee.
Agenda 3 xi(a)- Pilot Project for biometric-based Aadhaar authentication of registration
applicants in Puducherry.
4.46 Pr. Commissioner, GST Policy informed that the agenda 3 xi(a) is also related to agenda 3(xi)
pertaining to registration. He stated that Council had already agreed to have a biometric based Aadhaar
authentication in high risk cases and pilot was approved for State of Gujarat. Puducherry has also
requested to have a pilot for the same implemented in Puducherry. In this regard, approval is needed
for issuing the following notifications:
i. The State of Puducherry will need to substitute rule 8(4A) of Puducherry SGST Rules on the
lines of corresponding substitution of Rule 8(4A) of CGST Rules vide notification no.
04/2023-Central Tax dated 31.03.2023;
ii. Further, the State of Puducherry will also need to amend rule 8(5) and rule 9 of Puducherry
SGST Rules on the lines of corresponding amendments in CGST rules notified vide
notification no. 26/2022- CT dated 26.12.2022;
iii. The Central government will be required to further amend Notification No. 27/2022-CT dated
26.12.2022 for specifying that the proviso to rule 8(4A) will apply to the State of Puducherry
as well.
4.47 Further, it was proposed that the Council may authorize the Chairperson to extend the said pilot
project, if required, in other States and/ or Union territories which may be willing to conduct pilot for
biometric authentication of Aadhaar for high-risk registration applicants.
4.48 The Hon’ble Member from Andhra Pradesh stated that they are also interested in taking up this
pilot project, which was agreed. The Revenue Secretary agreed to the same.
4.49 Pr. Commissioner, GST Policy stated that amendments in rule 8(5), rule 9(1) and rule 9(2) of
CGST Rules 2017 have been notified by the Centre and State of Gujarat, but other States are also
required to notify the same so that mandatory physical verification can be conducted in high-risk
category identified by the Common portal, despite having Aadhaar authenticated.
4.50 He added that this was discussed in Officers’ meeting and was agreed to.
Decision: The Council agreed with the said recommendations made in the agenda as also to the
request of Andhra Pradesh to include it in the pilot for biometric Aadhar based authentication.
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Agenda 3 (xii)- Clarification on TCS liability under Sec 52 of the CGST Act, 2017, in case of
multiple E-commerce Operators (ECOs) in one transaction
4.51 Pr. Commissioner, GST Policy informed that the agenda 3(xii) is a circular for clarification
regarding TCS liability in the cases involving multiple electronic commerce operator, especially in the
case of Open Network Digital Commerce platform. The Law Committee recommended that it may be
clarified through a circular that in a situation where multiple ECOs are involved in a single transaction
through ECO platform, the compliances under section 52 of CGST Act, including collection of TCS, is
to be done by the supplier-side ECO who finally releases the payment to the supplier for a particular
supply made by the said supplier through him.
4.52 He also added that an in-principle approval was granted by GST Council in 47th meeting inter
alia for waiver of requirement of mandatory registration under section 24(ix) of CGST Act for person
making intra-state taxable supply of goods through ECOs, subject to certain conditions. In order to
implement the same, issuance of notifications under section 23(2) and section 148 of CGST Act, 2017
has also been recommended by the Council in its 48th meeting. As per the recommendations of the
Council, the same is to be implemented w.e.f. 01.10.2023. However, it is felt that the said draft
notification also needs to cover the situations involving model of multiple ECOs in a single supply of
goods through ECO platform. Law Committee recommended that the said draft notification, as
approved by the Council, may be amended further to provide for situations involving multiple ECOs,
as suggested in Annexure B to the agenda.
Decision: The Council agreed with the said recommendations of the Law Committee, along with
the circular and notification.
Agenda 3 (xiii)- Clarification on availability of ITC in respect of warranty replacement of parts
and repair services during warranty period.
4.53 Pr. Commissioner, GST Policy informed that the agenda is regarding a clarification in respect
of those cases where the manufacturer provides warranty replacement or repair services for some items
during the warranty period without any additional consideration. Issues were raised whether in these
cases, the supply of replacement parts is liable to tax or not or whether ITC is required to be reversed
or not. Therefore, a clarification has been recommended by the Law Committee in form of a circular to
cover various scenarios.
Decision: The Council agreed with the recommendation of the Law Committee to issue the
clarificatory circular.
Agenda 3 (xiv)- Amendments in CGST Rules consequent to amendment in CGST Act vide
Finance Act 2023
4.54 Pr. Commissioner, GST Policy Wing informed that this agenda is regarding amendment to
CGST Rules subsequent to amendment in CGST Act carried out through Finance Act, 2023.
4.55 Rule corresponding to the Explanation to section 17(3) of CGST Act, 2017: The Law
Committee recommended that the activities or transactions of paragraph 8(a) of Schedule III of CGST
Act, the value of which shall not be excluded from exempt supply as per amended Explanation to sub-
section (3) of section 17 of CGST Act, 2017, need to be prescribed by amending CGST Rules, 2017 by
way of Insertion of Explanation 3 to rule 43 of the CGST rules.
4.56 Amendment to rule 162 of CGST Rules 2017: Subsection (2) of section 138 of CGST Act,
2017 provides for prescribing the amount for compounding various offences under CGST Act through
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CGST Rules, 2017. Therefore, Law Committee has recommended that sub-rule 3A may be inserted in
rule 162 of CGST Rules to prescribe compounding amount for various offences.
Consent Based Sharing of Information
4.57 To implement the provisions of the newly inserted section 158A of CGST Act, rules need to be
framed and implemented. The Law Committee has recommended insertion of new Rule 163 in CGST
Rules, 2017 for the purpose of consent-based sharing of data available on the common portal with other
systems.
4.58 The Law Committee has also recommended that account aggregators may be notified as the
systems with which information may be shared by the common portal based on consent under Section
158A of the CGST Act, 2017. The draft notification under section 158A of CGST Act in this regard is
enclosed as Annexure-II with the agenda note.
4.59 Pr. Commissioner, GST Policy further mentioned that Council needs to fix the date on which
provisions of Finance Act, 2023 pertaining to GST will come into effect. He informed that the issue
was deliberated in the Officers’ meeting and it was suggested that 01.08.2023 may be fixed as the date
on which provisions of the Finance Act, 2023 pertaining to GST Appellate Tribunal may be notified by
the Centre at least, so that the work for setting up of Tribunals can be initiated at the earliest. Further, it
was suggested in Officers’ meeting that all other provisions of the Finance Act, 2023 may be notified
with effect from 01.10.2023.
Decision: The Council agreed with the said recommendation of the Law Committee, along with
the suggestions made in Officers’ meeting regarding date from which provisions of Finance Act,
2023 will come into effect.
Agenda 3 (xv)- Goods and Services Tax Appellate Tribunal (Appointment and Conditions of
Service of President and Members) Rules, 2019.
4.60 Pr. Commissioner, GST Policy informed that Agenda 3 (xv) is regarding Goods and Services
Tax Appellate Tribunal (Appointment and Conditions of Service of President and Members) Rules,
2019. He informed that the draft rules as recommended by Law Committee are detailed in the agenda.
He added that the issue was deliberated in detail in Officers’ meeting, wherein officer from State of
Maharashtra suggested that in sub rule 5 of proposed rule 3 of the said Rules, the word “as well as
adjudicating” may be replaced by the word “and” and that Sr. No. 9 of Annexure-I of the said Rules
may be deleted. The same was agreed by the Officers.
Decision: The Council agreed with the said recommendation of the Law Committee, along with
the amendments suggested in the Officers’ meeting.
Agenda 3 (xvi)- Seeking clarity on taxability of share capital held in subsidiary company by the
parent company.
4.61 Pr. Commissioner, GST Policy stated that the Agenda is about clarity on the issue of taxability
of share capital held in subsidiary company by the parent company. but the Law committee deliberated
on the issue and has recommended to clarify through a circular that mere holding of the shares of
subsidiary company by the holding company cannot be treated as supply of services by the holding
company to the subsidiary company and cannot be taxed under GST accordingly.
4.62 The Hon’ble Members from Karnataka and Chhattisgarh requested to explain the proposal in
greater detail.
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4.63 Pr. Commissioner, GST Policy informed that the issue is regarding clarification as to whether
holding of shares in a subsidiary company by the parent companies to be treated as supply of service
under GST or not. Field formation are raising demand that the share capital held in subsidiary companies
are covered under SAC code 997171 and accordingly leviable to GST. As securities are neither treated
as goods nor treated as services, mere holding of shares of subsidiary company by the holding company
cannot be treated as supply of services. However, there may be independent supply of other services by
holding company to subsidiary company like providing a bank guarantee, etc.
4.64 The Hon’ble Member from Karnataka agreed to the recommendation. However, he felt that Law
Committee should examine the issue of taxability of other activities/ services by holding company for
subsidiary company. He further suggested that the circular may mention that ‘other advantages or
services will be looked into separately”.
4.65 The Hon’ble Members from Meghalaya and Uttar Pradesh stated that the proposal of the Law
Committee is only clarifying that the mere holding of securities of a subsidiary company by holding
company cannot be treated as supply of services and there is no ambiguity in it, and therefore, there is
no need for any amendment in the said proposed circular.
4.66 The Hon’ble Chairperson concluded the discussion by advising that while the issue of other
advantages and services may be looked into separately, mentioning the same in the circular may lead
to further litigation.
Decision: The Council agreed with the said recommendation of the Law Committee along with
the circular. Law Committee will further examine the issue w.r.t. other advantages and services
provided by companies to its subsidiaries.
Agenda 3 (xvii)- Amendment in CGST Rules, 2017
4.67 Pr. Commissioner, GST Policy stated that the Agenda is about various amendments in CGST
Rules. He added that that a number of these amendments are just procedural in nature for alignment
with various provisions requiring change or omission.
4.68 Following amendments in CGST Rules have been proposed as detailed in the Agenda:
1. Omission of clause (c) of Explanation (1) to Rule 43: This is an amendment consequential to
lapsing of an exemption.
2. Amendment in proviso to rule 46(f): Law Committee has recommended that proviso to rule
46(f) of CGST Rules may be amended to provide that the tax invoice may contain the name of
the State of the recipient only and the name and address of the recipient along with its PIN code
may not be mandatory to be declared on the tax invoice.
3. Amendment in Rule 64 and FORM GSTR-5A: Law Committee has recommended
amendment in rule 64 and in FORM GSTR-5A so as to also include details of supplies made
by the OIDAR service provider located outside India to registered persons other than non-
taxable online recipient in India in his return for tracking of payment of tax on RCM basis by
registered taxpayers.
4. Amendment in rule 89(1): Law Committee recommended to align the wording of the third
proviso of rule 89(1) with the Section 49(6) so that the casual taxpayer can file his refund claim
for the balance remaining out of the advance tax paid which is in the nature of excess balance
in electronic cash ledger only and which can be claimed as refund after filing of the last return.
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5. Amendment in Rule 89(2)(k) to include refund of interest and other amounts as per the Section
54(8) in case of refund of excess payment of tax.
6. Omission of 1st and 2nd proviso to sub-rule (2) of rule 96 as they do not serve any purpose
after the amendments in CGST Act.
7. Amendment in rule 108 and rule 109 of CGST Rules to provide a facility for filing appeal
manually in certain specified circumstances.
8. Amendment in FORM GSTR-3A for providing for notice for non-filing of Annual Return in
FORM GSTR-9 or FORM GSTR9A.
4.69 Pr. Commissioner mentioned that the issue was deliberated in detail in Officers’ meeting,
wherein officer from State of Maharashtra suggested that in respect of amendment in rule 108 and 109
of CGST Rules, the words “or due to non-availability of the facility” may be deleted from the proposed
provisos to rule 108(1) and 109(1). The same was agreed by the Officers.
4.70 The Hon’ble Member from Telangana mentioned that after the bifurcation of the State, because
of wrong mention of place of supply, tax has been credited to other States. He gave the example of
ICICI, in which Maharashtra has been wrongly credited Rs. 80 Crore. Therefore, some mechanism
needs to be built to correct it. In 47th GST Council meeting, assurance was given to constitute a
Committee of officers to resolve the issue and the same may be done. He also suggested that on wrong
credit, adjustment should be made subsequently.
4.71 The Hon’ble Chairperson stated that because there was a decision taken in the 47th council
meeting on the concern raised by Telangana, the officer’s committee must table a report to the Council
in the next meeting, highlighting challenges, possibility or impossibility of the implementation of the
issue raised by Telangana.
Decision: The Council agreed with the said recommendation of the Law Committee, along with
the amendment suggested in the Officers’ meeting. Moreover, the issue raised by the Member,
Telangana regarding wrong credit may be looked into as decided in the 47th GST Council meeting.
Agenda 3 (xviii)-Proposal to provide a special procedure to file appeal against the orders passed
in accordance with the Circular No. 182/14/2022-GST, dated 10.11.2022, pursuant to the
directions issued by the Hon’ble Supreme Court in the Union of India v/s Filco Trade Centre Pvt.
Ltd.
4.72 Pr. Commissioner, GST Policy stated that the agenda is regarding a special procedure to be
provided in cases where Tran-1 and Tran 2 claims were filed in pursuance of direction given by Hon’ble
Supreme Court during two months’ window of 01.10.2022 to 30.11.2022. The Law Committee
recommended to provide a special procedure under Section 148 of CGST Act for filing of appeals
manually against the orders passed in accordance with Circular No. 182/14/2022-GST. A draft
notification providing the special procedure to be followed by a person desirous of filing an appeal
against an order passed by the proper officer in accordance with Circular No. 182/14/2022-GST which
was issued pursuant to the directions issued by the Hon’ble Supreme Court in the Union of India v/s
Filco Trade Centre Pvt. Ltd., SLP(C) No.32709-32710/2018 has been formulated by the Law
Committee and is detailed in the agenda.
Decision: The Council agreed with the said recommendation of the Law Committee.

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Agenda 3 (xix)- Issues pertaining to ISD mechanism and taxability of services provided by one
distinct person to another distinct person.
4.73 Pr. Commissioner, GST Policy stated the agenda concerns the ISD mechanism and taxability of
services between distinct persons. This issue was earlier deliberated by the GST Council and was
referred back to the Law Committee for further examination.
4.74 He informed that there are two aspects for consideration- regarding the common input services
procured from third parties and the internally generated services. The Law Committee proposed to issue
a circular to clarify the issue in respect of both of such cases.
4.75 The Law Committee took a view that there is no intent in the present provision of CGST Act to
make ISD mechanism mandatory, and accordingly, it may be clarified through a circular that it is not
mandatory to follow ISD procedure laid down in Section 20 of CGST Act read with rule 39 of the
Central Goods and Services Tax Rules, 2017 for distribution of ITC in respect of input services procured
by HO from a third party but attributable to both HO and BO or exclusively to one or more BOs and
that such credit can also be passed on by HO by issuing tax invoices under section 31 of CGST Act to
the concerned BOs. In cases, where HO wants to distribute credit through ISD mechanism, it shall be
required to get itself registered mandatorily as per provisions of section 24(viii) of CGST Act. Further,
it may also be clarified that HO can distribute the ITC to a BO through ISD mechanism or can issue
invoice under section 31 to a BO in respect of an input services received from a third party only if the
said services are being supplied to the concerned BO.
4.76 For prospective periods: Law Committee took a view that ISD procedure, as laid down in
Section 20 of CGST Act read with rule 39 of the CGST Rules, may be made mandatory prospectively
for distribution of ITC in respect of input services procured by Head Office (HO) from a third party but
attributable to both HO and Branch Office (BO) or exclusively to one or more BOs. Further, ITC on
account of input services received from a third party, where such input services are liable to tax on
reverse charge basis, should also be required to be distributed through ISD route. This will require
amendment in law which the Law Committee may formulate in due course.
4.77 For internally generated services: Law Committee recommended to clarify through the
Circular that in cases where full input tax credit is available to the recipient, the value of such supply of
services declared in the invoice by HO to BOs may be deemed as open market value, irrespective of the
fact whether cost of any particular component of such services, like employee cost etc., has not been
included in the value of the services in the invoice, or not. It may be further clarified that in cases where
full input tax credit is available to the recipient if the invoice is not issued with respect to any internally
generated services by the HO to the BO, the value of such services may be deemed to be declared as
Nil by HO to BO, and may be deemed as open market value in terms of second proviso to rule 28 of
CGST Rules.
4.78 Pr. Commissioner, GST Policy also stated that the Law Committee could not make any
recommendation for taxability and valuation of internally generated services in cases where full input
tax credit is not available to the recipient.
4.79 He mentioned that the issue was deliberated in detail in the Officers’ meeting. The officers
agreed with all the recommendations made by the Law Committee. However, in the Officers’ meeting,
discussions were also held on the issue of taxability of internally generated services in cases where full
input tax credit was not available to the recipient. He mentioned that it was broadly discussed in the
Officers’ meeting to clarify in the circular that in respect of internally generated services, the cost of
salary of employees involved in providing the said services, may not be required to be mandatorily
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included while computing the taxable value of the supply of such services, in cases where full input tax
credit is not available to the recipient. He sought approval of the Council for incorporation of the
suggestion made in Officers’ meeting in the draft circular recommended by the Law Committee.
4.80 The Hon’ble Member from Karnataka suggested that Law Committee may also consider the
possibility of allowing taxpayers to apportion costs of supplies according to their discretion without
making it overly burdensome. The aim is to facilitate compliance and avoid the need for meticulous
breakdown and apportionment of every cost. He also added that there is a need for caution as this is
liable for different interpretations and may give rise to disputes.
Decision: The Council agreed with the said recommendation of the Law Committee, along with
the suggestion made in the Officers’ meeting regarding taxability of internally generated services
in cases where full input tax credit was not available to the recipient.
5. Agenda item 4: Recommendations of the Fitment Committee for the consideration of the GST
Council

5.1 The Secretary introduced the agenda item relating to the recommendations of the Fitment
Committee. These recommendations had been given in six (06) Annexures, the first three related to
Goods and the other three related to Services. The first Annexure listed issues relating to goods where
tax rate changes or clarifications were recommended; the second Annexure listed items related to Goods
where no tax rate changes were recommended and the third Annexure listed items related to Goods
where the issues were deferred by the Fitment Committee for further examination. The fourth Annexure
listed the recommendations for making changes in GST rates or for issuing clarifications in relation to
Services; the fifth Annexure listed the services where no tax rate changes were being recommended and
the sixth Annexure where the issues were deferred by the Fitment Committee for further examination
in relation to services.
5.2 The Secretary then asked the Joint Secretary, TRU, DoR to take the Council through the brief
presentation on the recommendations of the Fitment Committee.
5.3 JS, TRU stated that a total of 35 issues in respect of goods were examined. Out of these, on 14
issues, recommendations were made for tax rate changes or issuance of clarifications, on 17 issues no
tax rate change or status-quo was recommended and on 4 issues, the Fitment Committee has
recommended deferring the issues for further examination. She further stated that a total of 16 issues in
respect of services were examined, out of which, on 7 issues recommendations were made for tax rate
changes or clarifications, on 3 issues, no tax rate changes or status-quo was recommended and on 6
issues the Fitment Committee had recommended deferring the issues for further examination. The
presentation made by JS, TRU is attached as Annexure-4.
5.4 JS, TRU started with the agenda items pertaining to goods where change in rates or issuance of
clarification (14 issues) had been recommended by the Fitment Committee (Annexure-I).
5.5 The first issue pertained to tax rate change on uncooked/unfried snack pellets manufactured
through extrusion process where the Fitment Committee recommended to reduce GST to 5% on
uncooked/unfried extruded products by whatever name called. Fitment Committee also recommended
to regularize for past period on ‘as is where is’ basis due to genuine doubts. She further informed that
the said issue was also discussed in detail in the Officer’s Meeting on 10.07.2023 and no objections
were raised.
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Decision: The Council agreed with the recommendation of the Fitment Committee to reduce the
tax rate on uncooked/unfried snack pellets manufactured through extrusion process by whatever
name called from 18% to 5% and regularize the issue for the past period on ‘as is where is’ basis.
5.6 The Hon’ble Member from Delhi thanked the Council for the decision.
5.7 JS, TRU then presented the second issue pertaining to Fish Soluble Paste where Fitment
Committee recommended that since the final product fish meal attracts 5%, there appears to be merit in
the argument that by waste generated as a by-product during the process of manufacture of fishmeal
should not attract 18% and recommended to reduce GST rate on Fish Soluble Paste (2309) to
5%. Fitment Committee also recommended to regularize the matter for the past period on “as is basis”
in view of genuine interpretational issues.
5.8 The Hon’ble Member from Goa thanked the Council for reducing the tax rate on Fish Soluble
Paste. He further cited the judgment of Hon’ble High Court of Madras in the case of Jenefa India vs
GOI and informed that only the taxpayers of State of Tamil Nadu are getting benefit of exemption on
Fish meal while the taxpayers of rest of the States are paying 18%. He added that the exchequer is
incurring substantial loss of revenue because of this anomaly and requested GST Council to ensure a
uniform levy. He also requested that the practice in the State of Karnataka may also be rechecked in
this regard.
5.9 The Hon’ble Member from Tamil Nadu stated that if there is something by which exchequer is
incurring loss of revenue then the State of Tamil Nadu will collect all the information about it and
definitely act accordingly.
5.10 It was informed by JS, TRU that an appeal has been preferred against the said judgement.
Hon’ble Member from Chattisgarh enquired whether a stay has been obtained and if not, then whether
the option of exemption was still being exercised.
5.11 The Hon’ble Chairperson sought a report on the entire issue within a week’s time.
5.12 The Hon’ble Member from Goa thanked the Council for considering this issue.
Decision: The Council agreed with the recommendation of the Fitment Committee to reduce the
tax rate on Fish Soluble Paste from 18% to 5% and regularize the issue for the past period on ‘as
is where is’ basis.

5.13 JS, TRU then presented the third issue pertaining to IGST exemption on the cancer medicine
Dinutuximab (Quarziba) used for treatment of Neuroblastoma when imported for personal use. She
stated that during the officers’ meeting on 10.07.2023, one of the suggestions was to check from the
Ministry of Health and Family Welfare whether the said medicine is manufactured in India and that it
has been informed by the Ministry of Health and Family Welfare that it is not approved for manufacture
in India and the country’s needs are met by import.
Decision: The Council agreed with the recommendation of the Fitment Committee to exempt
IGST on Dinutuximab (Quarziba) when imported for personal use.
5.14 JS, TRU then presented the fourth issue pertaining to medicines and Food for Special Medical
Purposes (FSMP) used in the treatment of rare diseases and informed that the Fitment Committee
recommended to exempt IGST on such medicines used in the treatment of rare diseases enlisted under
the National Policy for Rare Diseases (NPRD), 2021 which are imported for personal use subject to the
existing conditions and when imported by Centre of Excellence or any person or institution on
recommendation of any of the listed Centre of Excellence. She also informed the Council that post
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Budget 2023-24, Basic Customs Duty (BCD) exemption has been given to drugs and Food for Special
Medical Purposes (FSMP) when imported for personal use for treatment of rare diseases enlisted in the
National Policy for Rare Diseases, 2021. The BCD exemption currently available for drugs used in
treatment of rare diseases imported by Centres of Excellence for Rare Diseases or any person or
institution on recommendation of any of the listed Centre of Excellence was also expanded to include
Food for Special Medical Purposes (FSMP)

Decision: The Council agreed with the recommendation of the Fitment Committee to exempt the
IGST on medicines and Food for Special Medical Purposes (FSMP) used in the treatment of rare
diseases enlisted under the National Policy for Rare Diseases (NPRD),2021 which are imported
for personal use subject to existing conditions and when imported by Centres of Excellence or
any person or institution on recommendation of any of the listed Centre of Excellence.

5.15 JS, TRU then presented the fifth agenda pertaining to issuance of clarification about GST rate
on Trauma, Spine and Arthroplasty implants falling under heading 9021, for the period prior to the
18.07.2022. She informed that earlier there were two entries @ 5% and 12% for similar goods under
9021, which was causing confusion. On the recommendations of 47th meeting of the GST Council, a
GST rate of 5% was fixed on all goods falling under heading 9021 w.e.f. 18.07.2022.
5.16 Fitment Committee recommended to regularize the matter for the period prior to 18.07.2022 on
“as is basis” provided tax had been paid @5% or 12% in view of genuine interpretational issues.
Decision: The Council agreed with the recommendation of the Fitment Committee w.r.t. rate on
Trauma, Spine and Arthroplasty implants.

5.17 JS, TRU presented the sixth issue pertaining to request for clarification on raw cotton supplied
by agriculturists to cooperatives. Fitment Committee recommended to clarify that supply of raw cotton,
including kala cotton, from agriculturists to cooperatives is a taxable supply and attracts 5% GST under
reverse charge mechanism since cooperatives are registered persons, and also recommended to
regularize for the past periods on “as is basis” in view of genuine doubts regarding taxability. She also
informed the Council that in the officers’ meeting no objections were raised on the recommendations
of the Fitment Committee on this issue.
Decision: The Council agreed with the recommendations of the Fitment Committee w.r.t. raw
cotton.
5.18 JS, TRU then presented the seventh issue pertaining to consequential changes after the new
Foreign Trade Policy coming into force. She stated that the Foreign Trade Policy 2023 came into force
with effect from 1st April, 2023 and that the changes mostly involved updating the references of relevant
paragraphs in various Customs and IGST notifications. Fitment Committee recommended for
consequential changes to be carried out in notifications which would be mostly technical in nature.
Decision: The Council agreed with the recommendation of the Fitment Committee w.r.t changes
in view of the new FTP.

5.19 JS, TRU then presented the eighth issue pertaining to the issue clarification of applicable GST
rate - on imitation zari thread to avoid ambiguity prevailing on the applicable rate of GST on such
goods. Fitment Committee recommended to reduce GST rate to 5% on imitation zari thread or yarn
known by any name in trade parlance and further recommended that the issue may regularized for the
past period on “as is where is” basis.
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Decision: The Council agreed with the recommendation of the Fitment Committee w.r.t. imitation
zari thread or yarn known by any name in trade parlance.

5.20 JS, TRU then presented the ninth issue pertaining to LD Slag where Fitment Committee
recommended to reduce the tax rate from 18% to 5% considering that consumption of LD slag needs to
be encouraged for better utilization of this waste and protection of environment and to bring parity with
Blast Furnace Slag (BFS) and Fly Ash. JS, TRU stated that LD slag is a by- product of steel industry.
She further informed that in the Officers meeting, officers from Orissa and Punjab had pointed out that
the issue had also been discussed in 48th meeting of the GST Council wherein the recommendation for
reduction of rate was not agreed to since ITC would be available to cement manufacturers. It was
explained that LD slag is not preferred by the cement industry due to excess lime content and for uptake
in cement industry they have to do further processing. Karnataka had also clarified that other by
products of steel already attract 5% and therefore on grounds of parity the rate might be considered for
reduction. On other by products too the rate was reduced on grounds of environmental concerns.
5. 21 Hon’ble Member from Maharashtra pointed out that if there is no offtake, the issue of taxing at
18% has no meaning.
5.22 The Hon’ble Member from Orissa stated that the pre-GST incidence of tax on LD slag was
17.5% (12.5% central excise and 5% VAT). Present rate of 18% in line with pre GST tax incidence. He
stated that the Fitment Committee had recommended status quo earlier which is in line with the decision
taken by the Council to tax essential commodities at 5% and that other for other items the tax rate should
be kept at 18%, and therefore this recommendation of the Fitment Committee is at variance with that
adopted in 45th GSTCM. The Hon’ble Member from Odisha requested that the issue be referred back
to the Fitment Committee and Odisha may be invited to give its views on the same.
5.23 The Hon’ble Member from Delhi enquired about the quantum of LD slag produced in the
country versus the offtake, because the decision would be taken on that basis.
5.24 JS TRU stated that for 10 MT of steel production, 1.8 MT LD slag is produced, and since the
National Steel Policy envisages 300 million tonnes of steel production by 2030, India will produce 99
million tonnes of BF slag and 54 MT of LD slag, that while steel industry will consume significant
amount of BF slag, there would be few takers for LD slag at high GST rate, and dumping of LD slag
will result in environmental hazard. She stated that the offtake is now 25%.
5.25 The Hon’ble Member from Karnataka stated that dis-incentivizing the usage of LD slag by
keeping the GST rate at 18% would not be in the interest of the environment. He stated that if cement
manufacturers use LD slag, whether the tax rate was 5% or 18%, benefit of ITC would be available to
them and hence there would be no loss to the exchequer. Now, since the rate is at 18%, the road making
industry is dis-incentivized from using LD slag. By lowering the rate to 5% if we can encourage some
end usage of this product, it would be in the larger social and environmental interest.
5.26 The Hon’ble Member from Kerala stated that while there is a revenue angle, for example Odisha
was producing LD slag and therefore their revenues might be affected, the environmental angle was
equally an issue. So if the usage was in the cement industry, it might be okay but while promoting usage
of LD slag in roads, environmental issue needs to be kept in mind. He further stated that in Kerala LD
slag was not being used in construction of roads as they do not have steel industry but considering the
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fact that 100 MT of LD slag was going to be produced in the future, whether it will create some other
environmental issue if used in roads needs to be kept in mind.
5.27 The Hon’ble Chairperson stated that argument was to reduce the rate to incentivize the use of
LD slag which would result in collateral benefits of be reducing the harmful effects of dumping this
waste product.
5.28 The Hon’ble Member from Telangana stated that they were able to use 100% of fly ash produced
in their State for bricks and for use in highway construction and no hazards were reported.
5.29 The Hon’ble Member from UP agreed to the levy of 5% GST on LD slag. Based on discussions,
Hon’ble Member from Odisha also agreed to the levy of 5% GST on LD slag.
Decision: The Council agreed with the recommendation of the Fitment Committee w.r.t. LD slag.
5.30 JS, TRU presented the tenth issue pertaining to amend the exemption notification No.50/2017-
Customs dated 30.06.2017. Fitment Committee recommended to update list 34 in Notification 50/2017-
Customs so as to include RBL Bank and ICBC Bank and update list 34 as per the updated Appendix
4B of FTP-2023 subject to confirmation from DGEP and DGFT.
Decision: The Council agreed with the recommendation of the Fitment Committee to include RBL
Bank and ICBC Bank.
5.31 JS, TRU presented the eleventh issue pertaining to applicability of compensation cess on utility
vehicles such as MUV/XUV /MPV with length more than 4000 mm, engine capacity more than 1500
cc and ground clearance of 170 mm and above. She stated that during the discussion in the 48th meeting
of GST Council held in December, 2022 on agenda item relating to issuance of clarification on
compensation cess leviable on SUVs, Hon’ble Member from Haryana had suggested that compensation
cess on other utility vehicles such as MUV might also be deliberated upon. The Council directed the
Fitment Committee to examine the same. She stated that earlier, based on the recommendation of the
21st GST Council, a higher rate of compensation cess of 22% was notified on “Sports Utility Vehicles
(SUVs) (of length more than 4-metre, engine capacity more than 1500 cc and ground clearance 170
mm)”. Fitment Committee has now recommended to amend the entry to include all utility vehicles by
whatever name called provided they met the parameters of length greater than 4000 mm, engine
capacity more than 1500 cc and ground clearance of 170 mm& above and further recommended to
insert an explanation to clarify for the purposes of the said notification entry that “Ground Clearance”
in entry 52B means Ground Clearance in un-laden condition.
5.32 Secretary, Haryana stated that around 40% of the SUVs are still falling under the 20% Cess slab
and due to laden height condition, 2% Cess is being lost which amounts to a great loss of the revenue.
He further added that there is a difference in the way the ground clearance is being calculated as per
BIS standard and Fitment Committee recommendation and suggested to fix the cess at 22% for all
SUVs.
5.33 JS, TRU informed that the State of Haryana had raised the issue in the meeting of the Fitment
Committee. She stated that the suggestion to merge the entries 52A and 52B of Notification No.1/2017-
Compensation Cess (rate) into one category to make Compensation Cess rate uniform at 22% would be
taken up in the next Fitment Committee. She stated that this particular clarification as recommended by
the Fitment Committee would cover some models of vehicles. More data is required to analyze the
revenue impact of merging 20% and 22% cess slabs, as suggested by the State of Haryana.
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5.34 The Hon’ble Chairperson requested Haryana to provide additional data to the Fitment
Committee and for now the recommendation of the Fitment Committee may be accepted.
Decision: The Council agreed with the recommendation of the Fitment Committee and
accordingly agreed to amend the entry 52B in the compensation cess notification to include all
utility vehicles by whatever name called provided they meet the parameters of length exceeding
4000 mm, engine capacity exceeding 1500 cc and having ground clearance of 170 mm & above
and to clarify by way of inserting an explanation that ‘ground clearance’ means ground clearance
in unladen condition.
5.35 JS, TRU then presented the twelfth issue pertaining to Compensation Cess rate on Pan Masala
chewing tobacco etc. JS, TRU informed that the levy of compensation cess on these products was
converted from ad valorem tax to specific tax based levy linked to retail sale price (RSP) on such
products to implement the recommendations made by the GST Council in its 49th meeting. She stated
that they have been receiving representations about the challenges in determining the rate of
compensation cess in cases where it is not legally required to declare the RSP. The Fitment Committee
has therefore recommended to notify that the earlier ad valorem rate as was applicable on 31st March,
2023 for such goods by amending the said Notification in cases where it is not legally required to declare
RSP.
5.36 The Hon’ble Chairperson asked Hon’ble Member from Uttar Pradesh if he is in agreement with
the recommendations of the Fitment Committee as the particular issue was raised by State of Uttar
Pradesh.
5.37 The Hon’ble Member from Uttar Pradesh stated in the affirmative.
5.38 The Hon’ble Member from Karnataka inquired about the value difference between the
calculation of ad-valorem rate and a weighted average of the RSP.
5.39 JS, TRU informed that there is no difference in the rate as the ad valorem rates were converted
to specific rates based the recommendations of the GoM.
5.40 Hon’ble Member from Karnataka expressed his apprehension that if there was a significant rate
difference, it might create an arbitrage and provide an incentive to move from RSP based levy to an ad
valorem rate.
5.41 The Secretary mentioned that there may be a difference and that is why in order to plug revenue
leakages, the GoM had recommended the levy of cess on pan masala, chewing tobacco etc. be based on
RSP instead of the earlier ad valorem based levy. He stated that there was a possibility that the whole
value chain may not be captured for revenue purposes if we revert to the earlier system, but where there
is no legal requirement to have a RSP, there is no other option other than go for ad valorem rate.
5.42 He stated that the concerns raised by Hon’ble Member from Karnataka could only be addressed
by enforcement measures. The Hon’ble Member from Karnataka suggested that the ad-valorem levy
could be made equal to the weighted RSP to prevent arbitrage.

Decision: The Council agreed with the above recommendation of the Fitment Committee w.r.t.
compensation cess rate on tobacco products.
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5.43 JS, TRU presented the thirteenth issue pertaining to desiccated coconut for the period
01.07.2017 to 27.07.2017. She stated that prior to 27.07.17 there was no specific entry for Desiccated
Coconut and the taxpayers assumed that it was exempt. Representations had been received requesting
to regularize the intervening period between issue of original notification and issue of corrigendum to
notification 1/2017-CT(R) dated 27.7.2017 prescribing 12% GST rate. Fitment Committee
recommended to regularize the period 01.07.2017 to 27.07.2017 on “as is where is” basis on account
of genuine interpretational issues.
Decision: The Council agreed with the recommendation of the Fitment Committee
w.r.t. desiccated coconut.
5.44 JS, TRU presented the fourteenth issue pertaining to Areca Leaf plates and cups. She stated cups
and plates made of areca leaf are already exempt. Fitment Committee had examined it and suggested
that no action is required on the representation received but during the officers’ meeting it was clarified
that the request was not for exemption but for regularizing the period prior to the exemption i.e. prior
to 1.10.2019, on “as is basis” and the same was discussed in the officers’ meeting and therefore,
recommended for its regularization.
Decision: The Council agreed with the recommendation w.r.t. areca leaf plates and cups.

5.45 JS, TRU then presented the agenda pertaining to goods (17 issues) where no changes or status
quo had been recommended by the Fitment Committee (Annexure-II).
5.46 She presented the first issue i.e, reduction of GST rate on Agro-based biomass pellets from 5%
to Nil. She informed that Ministry of Power has requested for reduction of GST rate to Nil on solid bio-
fuel pellets / Biomass briquettes or pellets on the basis that they have a mandate to use 5% for coal
firing and also promote its uptake. She further stated that Fitment Committee had recommended status
quo which was placed before the GST Council in 37th and 47th GST Council Meeting, and the GST
Council did not recommend further reduction in rate to Nil. She said that Gujarat had suggested
regularizing the issue relating to GST on biomass briquettes for the period from 1.7.2017 to 12.10.2017.
5.47 The Hon’ble Member from Punjab suggested that GST rate on Agro based biomass pellets may
be reduced to Nil keeping in mind the environment issues as pollution is a huge problem in north India
and many NGOs and Courts are also involved.
5.48 The Secretary noted that only Punjab appeared to be in favour of reducing the rate to Nil.
5.49 The Hon’ble Member from Uttar Pradesh informed that this issue is already discussed in earlier
GST Council Meeting and Fitment Committee has also not recommended the same.
5.50 The Secretary informed that this product goes into the exempt sector that is production of
electricity and therefore, exempting this would mean a loss of revenue to the government.
5.51 The Hon’ble Member from Delhi inquired about the quantum involved.
5.52 JS, TRU informed that as per Ministry of Power, demand of Agro-based biomass pellets has
increased upto 1 lakh MT per day. However, the present capacity is 7000 to 8000 MT, so the request is
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to increase its uptake. She further informed that since this product is primarily used in the electricity
sector, it will amount to zero rating supply which is usually for export.
5.53 The Hon’ble Member of Delhi said that issue is similar to the LD slag issue and it is an
environmental issue and suggested reducing the tax rate from 5% to Nil to increase the off take.
5.54 JS, TRU informed that there is a difference between LD slag and Agro-based biomass pellets
where the first one is part of the GST chain while the latter one becomes a zero rated supply and goes
out of the GST chain.
5.55 The Hon’ble Chairperson appreciated the point about environmental concerns but stated that
zero rating is meant for exports as taxes are not exported. She stated that rate for LD slag was not being
brought to zero and the recommendation was to tax it at 5%. Here also the tax rate suggested is 5%.
5.56 The Hon’ble Member from Punjab requested that issue may be referred back the issue to Fitment
Committee.
5.57 The Hon’ble Chairperson appreciated the view of Member from Delhi and reiterated that zero
rating supply is for exports. She informed that Fitment Committee suggested for 5% GST Rate for LD
slag not Zero. Here too environment concerns a taken into account and the tax rate is being
recommended to be fixed at 5%.
5.58 The Hon’ble Member from Uttar Pradesh stated that there has been no change in circumstances
since the decision of the GST Council and therefore, the issue should not have been reopened.
5.59 JS TRU explained that based on VIP references/Ministry reference issues get reopened.
5.60 The Secretary suggested that an issue which is approved in the recent past should not be brought
back to the Council until there are new facts or changed circumstances. He sought permission of the
Chair and the approval of the Council to reply to such references about the decision taken and not bring
the issue over and over again before the Council unless the material change in circumstances is brought
on record. Chairperson agreed to the same.

Decision: The Council agreed with the recommendation of the Fitment Committee to maintain
status quo on the rate and regularize the issue relating to biomass briquettes for the period
1.7.2017 to 12.10.2017 on “as is basis”.

5.61 JS, TRU then presented the second issue regarding request for increase in GST rate of De-Oiled
Rice Bran from Nil to 5%. She informed that recommendation had been received from the Department
of Food and Public Distribution to impose 5% GST Rate on DORB. She informed that prior to the 25th
Council Meeting Rice Bran (HS 2302) for use as feed was at Nil and for other uses was at 5%. The
GST Council in its 25th Meeting held on 18.01.2018, decided to levy 5% GST on Rice Bran, irrespective
of end use, and Nil GST on De-Oiled Rice Bran. This was notified w.e.f. 25.01.2018. The interim report
of GoM on rate rationalization also did not recommend bringing all goods under chapter 23 to 5% GST
Rate and hence Fitment Committee recommended for status-quo.

Decision: The Council agreed with the recommendation of the Fitment Committee to maintain
status quo w.r.t. De-Oiled Rice Bran.
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5.62 JS, TRU then presented the third issue pertaining to products falling under any chapter, prepared
or manufactured by the inmates of Kerala Prison and Correctional Services Department. She informed
that recommendation was received for Nil GST Rate. Fitment Committee recommended for status-quo.
5.63 The Hon’ble Member from Andhra Pradesh suggested that Council needs to look at the issue
from different perspective and at such correctional facilities instead of hard labour now training on
vocational skills is being imparted. Mostly three kinds of products are being supplied: cloth, bakery
products and furniture/steel products and the amount in question is also very little. He stated that the
request has been turned down on the apprehension that there might be revenue leakages. He requested
that the exemption might be considered that the sale happens only through a few central prisons, each
State having 4-5 such prisons. He requested to exclude such products from GST bearing in mind that
these products need to be competitive in the market and that the inmates need to be imparted some skill
so as to enable them to eke out their livelihood after leaving prison and keep themselves occupied while
serving their time in jail.
5.64 State of Kerala supported the view of Andhra Pradesh.
5.65 The Hon’ble Member from Maharashtra was of the view that there were other ways to support
such goods such as making mandatory procurement of such goods by Government departments and did
not support tax concession.
Decision: The Council agreed with the recommendation of the Fitment Committee to maintain
status quo w.r.t. proposal pertaining to Kerala Prison and correctional Services Department.
5.66 JS, TRU stated that the next issue pertained to bio-fertilizers and other such organic inputs and
the issue of rate reduction on the same had already been examined in the 31st,39th, 45th and 47th Council
meetings but the Council did not recommend any change in the rates of bio-fertilizers and other such
organic inputs. The Fitment Committee recommended maintaining status quo. The Secretary then
requested for the comments of the Hon’ble Members of the Council on the recommendations put forth
by the Fitment Committee on the issues pertaining to GST rate reduction on Sungudi Saree; upfront
exemption from payment of IGST and refund mechanism to be done away with for IAEA; GST rate
reduction for Av gas; machinery used in Sericulture Industry and automatic reeling machinery; all
Sports goods & fitness products and Mega Power Projects. All agreed to the same.
Decision: The Council agreed with the recommendations of the Fitment Committee to maintain
status quo w.r.t. agenda as detailed in para 5.65 above.
5.67 The Secretary then requested for the comments of the Hon’ble Members of the Council on the
recommendations put forth by the Fitment Committee on the issues of Apple Carton Boxes. The
Hon’ble Member from Himachal Pradesh requested that corrugated boxes of specified dimensions can
be put in the lower tax bracket. He informed that 90% of the apple carton boxes used in the State of
Himachal Pradesh have capacity from 10 Kg to 20 Kg which have specific dimensions different from
the industrial packages and requested to reconsider the issue as the growers are being affected in small
horticulture States like Himachal Pradesh and reduce the GST rate from 18% to 12%. He informed that
in the last Council meeting, Maharashtra had come out in support of the issue.
5.68 Jammu and Kashmir informed that mostly corrugated boxes are being used in Jammu and
Kashmir which was earlier taxed at 12% but for the sake of uniformity the tax rate was increased to
18%. He requested to reduce the GST rate on corrugated boxes to 12%.
5.69 The Secretary noted that this item had been deliberated earlier multiple times and had come up
for discussion in the last meeting and stated that this will be difficult to administer as the same boxes
could be put to multiple uses. The Hon’ble Member from Maharashtra stated that the boxes were going
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to be used for various items and therefore, if tax rate is to be reduced, the reduction has to be given
irrespective of end use. Therefore, it is not feasible to reduce the tax rate in this case.
5.70 Hon’ble Member from Gujarat stated that industrial products could also be packed in such boxes.
5.71 Hon’ble Member from Himachal Pradesh requested to reduce the GST rate on carton boxes
from 18% to 12%.
5.72 The Hon’ble Member from Uttar Pradesh suggested to maintain the status quo on this issue.
5.73 Considering the aspect of usage of such boxes in agro-industry, the Hon’ble Chairperson
referred it back to the Fitment Committee for re-examination after obtaining the views of the States of
Jammu Kashmir and Himachal Pradesh.
Decision: The Council referred back the issue of GST on carton boxes to the Fitment Committee
for re-examination.

5.74 The Secretary then presented the issue of GST rate and compensation cess rate reduction for
two wheelers and four wheeler Flexi Fuel Vehicles and sought the comments of the Hon’ble Members
of the Council, if any.
Decision: The Council agreed with the recommendations of the Fitment Committee w.r.t. flexi
fuel vehicles to maintain status quo.

5.75 The Secretary then presented the issues pertaining to GST rate reduction in agricultural products;
utensils made of brass; Heavy feedstock, Vacuum Gas Oil, reformates, etc.; all bakery products
manufactured and sold by MSME and sought the comments of the Hon’ble Members of the Council, if
any.
Decision: The Council agreed with the recommendations of the Fitment Committee w.r.t. agenda
as detailed in para 5.74 above to maintain status quo.
5.76 The Secretary then presented the agenda pertaining to the goods (4 issues) where fitment has
deferred the issues for further examination (Annexure-III).
5.77 On the issue of Millet based products, the Hon’ble Member from Delhi suggested that the
decision on the Millet based products may be taken at an early date as this is the International year of
Millets as declared by the Government of India and secondly, increasingly it is part of nutrition supplied
by most of the Anganwadis and thirdly, it is a very healthy food option.
5.78 The Secretary assured that a decision on this would be taken as early as possible.
5.79 The Hon’ble Member from Karnataka supported the view of Delhi and informed that lifestyle
diseases are on the rise due to imbalanced diets and millets are a healthier alternative also they use little
water and consume very little chemical fertilizers so their environmental footprint is very minimal too.
Millets are climate resilient crops and highly nutritious as they are naturally fortified. He requested for
a positive and early decision on this as this was the International Year of Millets and Government of
India has already taken other decisions to promote the use of millets.
5.80 The Secretary directed the Fitment Committee to come up with their recommendations
expeditiously.
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5.81 The Hon’ble Member from Uttar Pradesh stated that the tax rate related to steel scrap and
Millet based products needs to be decided on an urgent basis. JS, TRU informed the Council that a
sub-committee has been constituted by the Fitment Committee to deliberate upon the issue pertaining
to steel scrap. JS, TRU further informed that the agenda related to steel scrap and millet based products
would be taken up in the upcoming Council meeting. The Secretary informed that the issue pertaining
to steel scrap and millets would be taken up and brought before the Council in the upcoming meeting.
5.82 JS, TRU introduced the next Agenda item 4(d) where recommendations were made by the
Fitment Committee for making changes in GST rates or for issuing clarifications in relation to services
(Annexure IV). She stated that the first issue was related to exempting GST on satellite launch services
provided by private organizations and that satellite launch services by ISRO, Antrix Corporation Ltd.
and New Space India Limited are already exempt from GST. The Fitment Committee recommended
that exemption may be extended to satellite launch services provided by private organizations with a
view to provide level playing field and encourage start-ups.
Decision: The Council agreed with the recommendations of the Fitment Committee to exempt
GST on satellite launch services provided by private organizations.

5.83 Joint Secretary, TRU informed that the second issue listed at Sr. No. 2 of Annexure IV related
to rectification in item at Sl. No. 3(ie) of notification No. 11/2017-CTR which continued to have
reference to some of the housing schemes etc. figuring under erstwhile sl. No. 3(iv), (v) and (vi) of
the said notification in order to take care of the real estate projects which commenced prior to
01.04.2019. The items at sl. No. 3(iv), (v) and (vi) of the above notification were omitted vide
notification No. 03/2022-CTR dated 13.07.2022. The Fitment Committee recommended that the
anomaly be rectified by inserting suitable explanation to effect that the item at sl. No. 3(ie) of the said
notification refers to sub-items of the item (iv),(v) and (vi) of the notification as they existed in
notification prior to their omission vide notification No. 03/2022-CTR dated 13.07.2022.
Decision: The Council agreed with the recommendations of the Fitment Committee w.r.t.
insertion of an explanation at Sl. No. 3(ie) of notification No. 11/2017-CTR

5.84 The Secretary informed the Council that the third issue listed at Sr. No. 3 of Annexure IV related
to omission of clause (h) of explanation to the entry at Sl. No. 24 (i) of the notification No. 11/2017
CTR. On the recommendation of GST Council in its 47th meeting, exemption entry at sl. No. 53A of
the notification No. 12/2017 CTR dated 28.06.2017 which covered “services by way of fumigation in a
warehouse of agricultural produce” was omitted vide notification No. 04/2022-CTR dated 13.07. 2022.
However, a parallel entry at clause (h) of explanation to the entry at Sl. No. 24 (i) of the notification
No. 11/2017 CTR dated 28.06.2017 for the same service had not been omitted. Fitment Committee
recommended that the same may be omitted.
Decision: The Council agreed with the recommendations of the Fitment Committee w.r.t.
omission of an entry at clause (h) of explanation to the entry at Sl. No. 24 (i) of the notification
No. 11/2017 CTR dated 28.06.2017.
5.85 The Secretary informed the Council that agenda Item listed at Sr. No. (4)(a) of Annexure IV
related to exercise of option by Goods Transport Agencies (GTAs) to pay GST under Forward Charge
Mechanism (FCM). Fitment Committee recommended that the requirement to exercise option to pay
GST under forward charge every year may be done away with and it may be provided in the notification
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that GTAs who have exercised option to be under FCM during a particular Financial Year shall be
deemed to have exercised it for the next and future Financial Years unless they file a declaration that
they want to revert to Reverse Charge Mechanism (RCM).
5.86 The Secretary further informed the Council that for agenda Item listed at Sr. No. (4)(b) of
Annexure IV, GSTN has requested that a start date for filing of option by GTA may be provided for
subsequent Financial Years; otherwise the default date for exercise of option for a Financial Year shall
be 1st April of the preceding Financial Year. Having start date for exercise of option for a Financial
Year as 1st April of the preceding Financial Year is not desirable as this may give rise to false
impression to the GTAs that they have exercised option for the current financial year. Fitment
Committee recommended that the start date may be prescribed as 1st January of the preceding Financial
Year. Fitment Committee also recommended that the last date for filing the option may be changed
from 15th March to 31st March of preceding Financial Year.
5.87 JS, TRU stated that agenda Item listed at Sr. No. (5) of Annexure IV related to amendment to
be made to notification No. 8/2017-ITR and notification No. 10/2017-ITR to remove redundant
provisions pursuant to amendments in Finance Act, 2023 subsequent to Hon’ble Supreme Court
judgement in Mohit Minerals case in 2022. Fitment Committee recommended that the provisions
which were introduced to provide level playing field to Indian Shipping Lines have lost relevance and
thus needs to be amended/deleted. The proposed amendments/deletions shall be synchronized with
Section 162 of Finance Act, 2023 which is to come into effect from a date to be notified.
5.88 JS TRU stated that agenda Item listed at (6) of Annexure IV pertained to clarification for the
services supplied by a director of a company/body corporate to the company/body corporate in his
private or personal capacity. Fitment Committee recommended to clarify by way of the circular that
the services supplied by a director of a company or body corporate in private or personal capacity
such as services by way of renting of immovable property to the said company or body corporate are
not taxable under Reverse Charge Mechanism (RCM) under notification No. 13/2017-CTR (Sl. No.
6) dated 28.06.2017The said entry covers only those services supplied by a director of company or
body corporate, which are supplied by him as or in the capacity of director of that company or body
corporate and shall be taxable under RCM in the hands of the company or body corporate.
Decision: The Council agreed with the recommendations of the Fitment Committee as detailed
in agenda items listed at Sr. No. (4)(a), (4)(b), (5) and (6) of Annexure IV.

5.89 The Secretary stated that the last issue listed at Sr. No. 7 of Annexure IV pertains to issuance
of clarification that supply of food and beverages in cinema halls is taxable as restaurant service and
leviable to GST at 5%. Fitment Committee recommended that a clarification may be issued by way of
a circular that food or beverages served in a cinema hall is taxable as restaurant service as long as (a)
they are supplied by way of or as part of a service and (b) supplied independently of the cinema
exhibition service. Where the sale of cinema ticket and supply of food and beverages are clubbed
together, and such bundled supply satisfies the test of composite supply, the entire supply will attract
GST at the rate applicable to service of exhibition of cinema, the principal supply.
Decision: The Council agreed with the recommendations of the Fitment Committee for issuance
of clarification with respect to supply of food and beverages in cinema halls.
5.90 The Secretary informed the Council that on 3 issues, no changes have been proposed by the
Fitment Committee in relation to services (Annexure V): IGST exemption on purchase of aircraft and
aircraft lease payment, GST exemption on services by the way of granting affiliation to schools by
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Central Board of Secondary Education (CBSE) for conduct of secondary stage examinations in
schools and on digital news subscription.
Decision: The Council agreed with the recommendations of the Fitment Committee as detailed
in Annexure-V of agenda.
5.91 The Secretary informed the Council that the Fitment Committee deferred following 6 issues
(Annexure VI) related to clarification on
i. whether the service by way of hostel accommodation, service apartments/ hotels booked for
longer period were service of renting of residential dwelling for use as residence and
exempted as per entry number 12 of the notification no. 12/2017-CT(R) dated 28.06.2017
ii. exemption from GST to services provided by District Mineral Foundations,
iii. whether reimbursement of electricity charges received by the Real estate companies, malls,
airport operators etc. from their lessees/occupants were exempt from GST,
iv. whether ITC of other business verticals could be used to discharge GST on outward liability
in respect of restaurant service,
v. whether job work activity towards processing of “Barley” into “Malted Barley” attracts GST
@ 5% and in case it was held that GST @18% is leviable, to regularize for past on ‘as is
basis’, and
vi. whether uniform GST rate of 5% was to be applied on Business Correspondent services
provided in both rural/urban areas.
5.92 The Secretary called upon the Fitment Committee to bring the deferred agenda items to the
Council for a decision in the next meeting.
5.93 The Secretary then introduced the agenda item on positive list of services to be specified in Sl.
No. 3/3A of Notification No. 12/2017-CT (R) dated 28.06.2017 which was deferred in the 48th Council
Meeting held on 17.12.2022. The Secretary informed the Council that the agenda item was deliberated
in the officers meeting and it was suggested by one of the States that this agenda item should be taken
up. Officers from the States of Punjab and Bihar had requested to defer this agenda item. The Secretary
stated that the Council could take a call on whether to discuss or defer the agenda item. He further
stated that there exists an ambiguity around the phrase ‘in relation to’ and one of the suggestions
received was to delete this phrase from the entries in notification no. 12/2017 related to pure services
and Composite supplies provided to Central Government, State Government or Local Authority. The
Hon’ble Chairperson opened the floor for discussion in case the States wished to deliberate upon the
agenda or the States might put forth their views during the Fitment Committee meetings in case of
deferment.
5.94 The Hon’ble Member from Delhi expressed her desire to discuss the agenda and the issues
emanating from it as Delhi had some concerns regarding the same. The Hon’ble member from
Karnataka seconded it and stated that the proposition to remove the phrase “in relation to” put forth
by the Secretary to the Council might be deliberated upon to see if any consensus could be built on
striking out the phrase “in relation to” from Entry Nos 3 and 3A and the agenda item passed in the
meeting itself in case there were no other issues.
5.95 The Hon’ble member from Karnataka stated that in cities like Bangalore and Delhi, there were
specialized agencies which delivered municipal services. Therefore, services like garbage collection,
water supply, etc. attract GST @ 18% which was not in public interest at all. Therefore, if the Council
agreed to remove the phrase “in relation to” from Entry No. 3 and 3A that would resolve the issue for
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the State of Karnataka. Any other issue, if pointed out by any other State may be deliberated upon in
Fitment Committee meetings post deferment of the agenda item.
5.96 The Hon’ble Chairperson sought the opinion of other Hon’ble Members on the suggestion of
Hon’ble Member from Karnataka. In case, the issue related to removal of phrase “in relation to” was
the only issue and consensus was built in the Council, the Council might agree to pass the agenda by
incorporating the decision of the Council. In case of any substantial issues, the agenda item might be
deferred.
5.97 The Hon’ble Chairperson sought comments from Hon’ble Members of the Council whether
they agreed to the proposition of Hon’ble Member from Karnataka. The Hon’ble Member from Tamil
Nadu concurred with the views of Hon’ble Member from Karnataka suggesting for removal of the
phrase “in relation to” from the relevant entry. However, he objected to the actions of pruning of the
list for which tax exemption was available by giving a positive list. He cited that it leads to extra
financial burden for local bodies and State Government. Further, the Hon’ble Member from Punjab
sought some more time to study the list comprehensively and once again requested the Chair to defer
the agenda item to be taken up in the next Council Meeting.
5.98 Considering the views of the States of Punjab and Bihar, the Chairperson proposed to defer
the agenda item. The Secretary stated that it would be brought before the Council for a decision in the
next meeting of the Council.
Decision: The Council agreed to defer the agenda item.
6. Agenda Item 5: Second Report of the Group of Ministers (GoM) on Casinos, Race Courses and
Online Gaming
6.1 Joint Secretary, TRU presented a Factsheet on Horseracing, Online Gaming and Casino which
has been annexed as Annexure-5. The Factsheet encapsulates the factual status, revenue, legal position,
present practice and the issues for information and decision of the GST Council.
6.2 Sh. Conrad Sangma, the Honorable Chief Minister from Meghalaya and the Convener of the
Group of Ministers (GoM) on Casinos, Race Courses and Online Gaming, apprised the Council that
two reports had been submitted so far. However, in the second and final report the views remained
inconclusive due to complexity of issue and the different views expressed by the participating States
and hence stated that the GoM has recommended Council to take the decision.
6.3 In his address, he provided a contextual background of both reports and threw light on the initial
understanding of actionable claim except lottery, betting, and gambling, which were exempted from
Goods and Services Tax (GST). It was assumed that these activities which were under the purview of
discussion of GoM fell within the domain of lottery, betting, or gambling. Nonetheless, after engaging
with stakeholders, further clarity was gained, leading to the submission of the second report. It became
apparent during the discussions that a lack of clarity persists regarding the differentiation between
games of skill and games of chance. Games of chance fall under the category of betting and gambling,
whereas games of skill do not. The absence of clear legislative provisions pertaining to the classification
of games based on skill or chance compounds this issue and therefore depends on different Court
judgements to define game of skill or game of chance. Moreover, he highlighted that the Ministry of
Information Technology (MEITY) is actively working on formulating rules and classification of online
gaming. Until such classification is established and comprehensive rules are framed, it was suggested
that the Council may consider deferring any decision in this regard, as premature actions may adversely
affect stakeholders turning the attention to the matter of casinos. The Honorable Minister expressed his
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opinion that a highest tax rate of 28% should be levied on the Gross Gaming Revenue (GGR), calculated
at the table level rather than on individual transactions. This approach is in line with international
practices, as tracking each and every transaction of an individual may prove to be arduous. Sikkim and
Goa are the only two States having these casinos and both suggested that rate of 28% should be levied
on the Gross Gaming Revenue (GGR).
6.4 Furthermore, he added that the GoM engaged in an extensive discussion on whether Horse
racing classifies as game of skill or chance and should be treated as a separate category or encompassed
within the realm of betting and gambling. It was opined that there is no distinct classification for games
of skill, and they should be considered as part of the broader betting and gambling category. The
Hon’ble Supreme Court in Dr. K.R. Lakshmanan case held that Horse Racing is a game of skill
however, there is no legislative provision for mandating it as game of skill. There are also many cases
which were bought out by West Bengal during the GoM meeting and these cases are related to lottery
but horse racing was mentioned in those cases. Accordingly, a tax rate of 28% on the full face value
was recommended by GoM for such games.
6.5 The Convenor of the GoM acknowledged that despite multiple deliberations and expert
opinions, the main challenge lies in the fact that the GoM addresses three different games compounded
by the inherent ambiguity in existing legislation regarding whether these are games of skill or
chance. Hence, ambiguity has been left to be resolved by the Courts which complicate the matter more.
Moreover, the report highlights the dual nature of this issue, where economic growth and job creation
stand in contrast to the adverse social impact on the youth. Achieving a delicate balance between these
competing interests necessitates a phased approach to tackle this issue.
6.6 He stated that in conclusion, the GoM Report underscores the complexity of the subject matter,
urging careful consideration and a comprehensive approach by all the States to address the concerns
and interests of all stakeholders.
6.7 The Hon’ble Member from Gujarat concurred with the viewpoint of convenor and
acknowledged that the decision at hand on Casinos predominantly affects two States. The Minister
highlighted that a team from the Group of Ministers (GoM) had visited the affected areas and in their
opinion, the value should be calculated on the Gross Gaming Revenue (GGR).
6.8 The Hon’ble Member from Tamil Nadu expressed the view that the State had already issued a
notification prohibiting online gambling and online games of chance. The Minister suggested that the
same could be true for some other States also. As online gambling and online games of chances are
banned in Tamil Nadu, any decision by GST Council should conform with such State
legislation. Regarding horse racing, the Minister proposed that if it is deemed a game of skill, a tax of
28% should be levied on the GGR value. Conversely, if it is classified as a game of chance, the full
value at a tax rate of 28% should be considered. There should be a mechanism to receive and segregate
the money. The receipt money should be directly deposited into operator account and an escrow separate
account should be there to hold the prize money for eventual payout.
6.9 The Hon’ble Member from Maharashtra adopted a resolute stance, emphasizing the urgent need
to reach a long-awaited decision on the meeting day. The Minister recommended that online gaming,
casinos, and horse racing be incorporated into entry 6 of Schedule III of the Central Goods and Services
Tax (CGST) Act, 2017 alongside lottery, gambling, and betting as taxable actionable claim. The
Minister stated that delving into the specifics of what constitutes a game of skill or chance is
unnecessary as the law should be straightforward, easy and simple. The interpretation of games of skill
and chance is subjective within the realm of law which would create confusion on tax point of view. In
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addition, the Minister asserted that activities detrimental to social well-being should not be encouraged
or promoted.
6.10 The Hon’ble Member representing Uttar Pradesh expressed the urgency of taking the decision.
He conveyed that two reports have been compiled so far. First report was submitted with the consensus
of all States. However, after submission of first report in the Council Meeting, the perspective on the
matter changed. Uttar Pradesh maintained a steadfast view that a tax of 28% should be levied on the
full-face value. The Minister also highlighted the absence of a mechanism for calculating Gross Gaming
Revenue (GGR) and that it would generate negligible tax revenue. He also asserted that any game
involving monetary transactions should be categorized as a game of chance rather than a game of skill.
Moreover, he informed the Council that international jurisdictions also impose multiple taxes in
addition to GGR. Furthermore, he expressed his belief that Horse Racing is not a game of skill, but
rather a game of chance, given that individuals predominantly place bets on it without adequate
knowledge or through guesswork. Consequently, he advocated for taxing all such games at the highest
tax rate based on their full-face value.
6.11 The Hon’ble Member from Goa disagreed with the views of the other States and emphasized the
significance of the matter for their State. He likened the evaluation of different categories of games to
the act of comparing apples and oranges. He apprised the Council of the necessity to follow
internationally accepted best practices that would prevent the closure of industry. He suggested that the
Goods and Services Tax (GST) should be imposed based on GGR. He added that during the preparation
of the second report, experts evaluated the matter from various perspectives and varied opinions from
stakeholders were also sought which is the main reason for the lack of a firm recommendation from the
Group of Ministers (GoM) and the report remaining inconclusive. Furthermore, he asserted that this
subject is still evolving over time. He further proposed that the cardinal principle of GST is to align the
pre-GST tax regime with the present one. He informed the Council that Goa previously levied a
maximum entertainment tax of 15% on Casino industry and it was never 28% or not even 18%.
6.12 The Hon’ble Member from Goa highlighted the heavy dependence of Goa's economy on tourism
sector, particularly the Casino industry. He raised the issue of the revenue implications for the State if
the decision led to the closure of the Casino industry strongly emphasizing the financial impact of such
closure of casinos on the State. He also requested that if the consensus could not be reached on taxing
the Casino industry based on GGR, a new Group of Ministers should be constituted including
stakeholders as members. He cautioned that without proper regulation, the industry would not cease to
exist but rather shift to a grey platform resulting in more adverse consequences. He further added that
there is a new norm coming for 30% TDS apart from 28% of GST and resulting in 58% of total tax in
case of winner. Lastly, he appealed for the tax rate to align with the pre-GST regime and be set at 28%
based on GGR and requested the Council to decide in favour of Goa and Sikkim due to their dependency
on Casino industry.
6.13 The Hon’ble Member from West Bengal expressed agreement with the stance of Minister of
Uttar Pradesh and proposed that the tax rate should be set at the highest level on the full-face value. She
further recommended for amending the Schedule to include Online Gaming, Casinos, and Horse Racing
in the entry of actionable claim.
6.14 The Hon'ble Convenor of GoM stated that there is no dispute regarding the tax slab, as all States
agree to tax it at the highest rate of 28%. The only point of contention revolves around the valuation.
Furthermore, he explained that the change in perspective from the 1st report occurred due to a major
dispute regarding the definition of an actionable claim. Initially, the stance was that all games had a
genesis in betting or gambling. However, it later became apparent that these games also involve an
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element of skill, which became a subject of legal controversy and this is the reason that the definition
must be amended.
6.15 The Hon'ble Union Finance Minister responded that the Hon'ble Courts can decide them to be a
game of skill or chance. However, the key question is whether the government can impose taxes on
unregulated activities. She provided an example of crypto assets which are not regulated but are still
subject to taxation and no Court has challenged this. She further added that these games involve value
creation, whether with or without skill. She also stated that the governments have the right to tax that
value and there is no legal conflict in doing so. It may be game of skill or game of chance and debate
may be going on but tax should be imposed on these activities. She clarified that the Ministry of
Electronics and Information Technology (MEITY) is in the process of formulating technical regulations
related to online gaming. MEITY is working on regulatory framework in that domain. These types of
regulations do not affect the GST Council and do not infringe upon its sovereign right to impose tax.
6.16 The Hon'ble Member from Uttar Pradesh reiterated his earlier views and stated that the main
purpose of going to Goa is tourism for beaches, environment and only few tourists go to casino. If a
person is ready to lose money in casino, he must be ready to pay taxes for the welfare schemes.
6.17 The Hon’ble Member from Maharashtra expressed the opinion that tax should be charged on
the full- face value and it is up to the Council to decide whether it should be set at 18% or 28%. Before
calculating tax, a suitable abatement in face value may be given. Secondly, he firmly stated that online
gaming and racecourse are not games of skill on the part of person betting, and they should be taxed on
their full value. He further added that the operators who are engaged in these activities are of high
economic status and they should be treated accordingly.
6.18 The Hon’ble Member from Karnataka supported the views of Uttar Pradesh and Maharashtra.
He argued against delving into the question of whether a game is based on skill or chance and stated
that there are many court judgments deciding whether an activity is a game of skill or chance. The
sovereign has the power to tax regardless of the nature of game. He highlighted that while the GST
Council is primarily a body to take decisions on tax, it has also kept in mind the moral and social factors
since its inception like imposing environmental cess, cess on sin goods and luxury goods based on moral
principles. The tax on tobacco, luxury cars, and other items had sometimes exceeded their
manufacturing value taking into account social principles. He suggested that gambling and betting have
always been considered undesirable activities in our country and our taxation should be aligned with
these social policies. He stated that all these three activities fall under the same legal category and
granting the casino an exception tax on gross gaming revenue (GGR) based mechanism could lead to
legal disputes in future. He advocated for maintaining a uniform law for all three activities. In addition,
he supported views of Tamil Nadu and pointed out that online gaming has had a negative impact on the
youth, becoming an addiction for them. He expressed the view that no concession should be given to
these activities and these should be taxed at the highest rate. He stated that he did not oppose the idea
of treating casinos separately, but uniformity would be preferable. He also mentioned that the Karnataka
Government has been taxing race courses based on their gross value under the respective Acts since the
beginning and litigation had only arisen in recent years even though tax was previously paid on the
gross value only.
6.19 The Hon’ble Member from Kerala raised concerns about the impact of taxing on the basis of
GGR mechanism on lotteries as it could lead to litigation. He stated that this approach would also affect
the taxation of lotteries which are currently taxed at the full value of 28%. The Lottery Associations
have already made representations to tax @ 28% based on GGR.
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6.20 The Hon’ble Member from Gujarat noted that the initial consensus in the Group of Ministers
(GoM) was to impose the highest tax rate of 28% on all three activities. He expressed the need for a
conclusive decision in the meeting as the matter has been dragged on without reaching a resolution.
6.21 The Hon’ble Member from Uttarakhand agreed with the proposal to tax all activities at the
highest rate of 28%.
6.22 The Hon’ble Member from Delhi suggested that all three activities should be addressed
separately. Since the States of Goa and Sikkim are the only ones directly affected by casinos, their
situation should not hinder a decision on other sectors. She emphasized that the online gaming sector is
rapidly growing and requires a decision. Furthermore, she stated that in the case of casinos, all States
had a strong opinion but the affected States should have a greater say. She recommended that taxation
based on the GGR mechanism would involve complex calculations and proposed that the full-face value
should be taxed.
6.23 The Hon'ble Member from Nagaland stated that the Goods and Services Tax (GST) should not
be considered as a form of charity but rather as a means to generate tax revenue for the nation. The
Hon'ble member drew attention to the fact that gambling which encompasses these activities are bet
based on either skill or chance, with the ultimate intention of earning money. It was suggested that tax
should be levied on the full value of these activities without any exemptions as they are profit-oriented
sectors.
6.24 The Hon'ble Member from Sikkim expressed agreement with the comprehensive and
informative report presented by the Convenor, Group of Ministers (GoM). The Hon'ble Member
informed the Council that the State of Sikkim aligns itself with the view put forward by Goa as
documented in annexure on page 16 of Agenda No. 5. It was proposed that a GST rate of 28% be
imposed based on the Gross Gaming Revenue (GGR) mechanism as this was tried and tested valuation
method. Then he apprised the Council that prior to the implementation of GST, Sikkim taxed Casinos
at the rate of 10% on the GGR value. Furthermore, he stated that presently, 28% GST rate is being
charged and if the valuation method is altered, it would have a severe blow to the casino industry.
6.25 The Hon'ble Member then highlighted the distinction between these three activities despite their
apparent similarities as mentioned in 2nd report of GoM. Specifically, the Hon'ble Member underscored
that the unique feature of a casino is that each chip purchased by a player does not represent an
actionable claim. It was opined that imposing GST on the full-face value of all chips purchased in a
casino would be unjustifiable. The Council was informed that the annual revenue generated by the State
of Sikkim from these activities amounts to approximately Rs. 20 crores which is a substantial sum for
a small State like Sikkim where option of generating revenue is very limited. Casino industry is not
bound to any season and it brings people throughout the year. He further requested the Council for
separate rule for casino to levy of GST at the rate of 28 % on GGR. Regarding online gaming, it was
suggested that an effective method for computing the value of the supply of online gaming may be
determined by an inter-ministerial task force dedicated to this matter.
6.26 The Hon'ble Member from Chhattisgarh expressed agreement with the views presented by Uttar
Pradesh. He highlighted the adverse impact of these activities on our society. He further emphasized
the urgency of resolving this matter. It was recommended that a 28% GST rate be levied on the full
value of these activities regardless of whether they involve game of chance or skill.
6.27 The Hon'ble Member from Arunachal Pradesh seconded the views of Uttar Pradesh and
Meghalaya. He quoted example of Las Vegas and Macau which have no other attraction and where
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people go to play casino only whereas Goa is not only meant for casino and therefore, the rate of tax
does not affect tourism sector of Goa.
6.28 The Hon'ble Member from Andhra Pradesh stressed the importance of considering the specific
issues related to each State, keeping in mind the federal nature of the country and one nation one tax. It
was stated that larger States have ample resources to generate revenue whereas smaller States are often
at a disadvantage. The Hon'ble Member agreed with the views of Delhi and suggested that States like
Goa and Sikkim should have some degree of flexibility in raising revenue in absence of other source of
revenue.
6.29 The Hon'ble Member from Meghalaya reiterated that the procedures involved in each game are
distinct therefore they should be taxed based on their individual intricacies. It was proposed that a single
formula for calculation, could not be justified for every game. Additionally, the Hon'ble Member
recommended making appropriate amendments to the law in accordance with the decisions reached in
the Council to avoid any legal disputes.
6.30 The Revenue Secretary clarified that an amendment to the law is necessary as online gaming
companies have argued in various courts that online gaming is an actionable claim but is not a taxable
actionable claim in Schedule III of the Central Goods and Services Tax (CGST) Act. They contend that
it is a game of skill and does not involve any element of gambling or betting. The Council was informed
that the GGR is typically only 10-15% resulting in an effective tax rate of 1-3%. The Secretary strongly
put across that even food items are taxed at a rate of 5% which is the lowest slab rate. Therefore, clarity
must be brought through legislative amendments. It was mentioned that the draft amendments have
been prepared carefully in consultation with the Additional Solicitor General of India. Furthermore, it
was stated that the law should not be subject to interpretation regarding whether the activities are games
of skill or chance. With regards to the issue of retrospectivity, the Secretary stated that claims for
retrospective tax would continue but there would be no matter of dispute with regard to prospective
implementation. Finally, it was emphasized that the Council is a taxing body and not a regulatory
authority. So, Council should not be concerned with whether these activities are prohibited or regulated.
6.31 It was observed that all States are in agreement regarding the necessity of amending the law to
provide clarity on these issues. The decision on whether this amendment should be addressed in the
Law and Fitment Committee or brought back to the Council was left to the Council's discretion with
the aim of expediting the process. The Secretary suggested that the amendment may be brought through
ordinance or through legislature in next session so that Revenue could be collected on these activities
as soon as possible.
6.32 Thereafter, the Hon'ble Chairperson sought confirmation of the Council members on all three
issues (i) the issue of amending the law to include Casino, Race Course, and Online Gaming in Entry 6
of Schedule III of the CGST Act, 2017 alongside Lottery, Betting, and Gambling. This inclusion would
help avoid any interpretational confusion. She clarified that the exemption previously granted for GST
on actionable claims except for Lottery, Betting, and Gambling in Entry 6, would now be amended so
as to remove any confusion, to exclude Online Gaming and Horse Racing from exemption which would
be subject to GST without any exemption, (ii) the rate of tax and (iii) the value for supply.
6.33 The Hon'ble Member from Meghalaya expressed his agreement for the amendment deeming it
necessary and suggesting that the first report of the GoM (Group of Ministers) would suffice after such
amendments. The Revenue Secretary then informed the Council that a few more amendments would be
worked out by the Law Committee and circulated to the respective States for amendments in their State
GST Act subject to the Council's approval.
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6.34 The Hon'ble Member from Karnataka proposed to include an explanation in Entry 6 to
incorporate these games rather than amending the entire entry. Similarly, the Hon'ble Member from
Tamil Nadu suggested that the final draft of the amendment should be shared with all States. In
response, the Revenue Secretary stated that States like Tamil Nadu and Karnataka who wished to be
involved, could be included in the Law Committee to ensure a concurrent decision.
6.35 Taking into consideration the concern raised by Tamil Nadu, the Hon'ble Chairperson sought
the Council's wisdom on whether if any State has a law banning certain activities like Online Gaming
and the Council deems fit to tax that activity then would the amendment contradict the State Law. The
Revenue Secretary clarified that even currently, the Council imposes taxes on Gambling and Betting,
despite them being banned in certain States. He explained that the Council could only decide the
taxability of activity and the States regulate these activities. The Hon'ble Member from Karnataka and
Kerala agreed with the explanation given by Revenue Secretary.
6.36 The Revenue Secretary then requested the Council to decide the tax rate and valuation method
for these activities. He stated that uniformity in taxation for these activities was preferred, however
during consultations with the ASG (Additional Solicitor General), he indicated that differential
treatment could also be considered. He further mentioned that there was consensus among all States to
tax Online Gaming and Race Courses at 28% GST on their full value. The only remaining issue was
that of Casinos to be decided upon.
6.37 The Hon’ble Chairperson urged the Council to focus on executing and implementing the law on
these activities requesting practical and executable solutions rather than idealistic opinions.
6.38 Hon'ble Member from Goa and Sikkim strongly advocated for differential taxation of Casinos
based on the Gross Gaming Revenue (GGR) mechanism.
6.39 However, the Hon’ble Chairperson informed the Council that a consensus had been reached
among the States to tax Online Gaming and Race Courses at 28% on the full-face value. She requested
the Council to decide on the request made by the States of Goa and Sikkim to treat Casinos differently
and tax them based on the GGR mechanism.
6.40 The Hon'ble Member from Chhattisgarh, Kerala, and Karnataka expressed their opinion that the
principle of law should not be different for Casinos compared to other activities as it could have far-
reaching effects on other services. The Hon'ble Member from Karnataka suggested that the principle of
law should be the same for all activities and taxed on face value while the tax rate could vary. The
Hon'ble Member from Maharashtra also agreed with this view and proposed taxing Casinos at 28%
initially with the possibility of providing an abatement.
6.41 The Hon’ble Member from Nagaland stated that if casino was pan India and same rate would
not prevail, then it could have repercussion. As casino is specific to only two States i.e. Goa and Sikkim
thus exceptions could be made. Casino is lifeline for these two States and it would have huge impact
on their revenue.
6.42 The Hon'ble Member from Andhra Pradesh expressed the belief that only the States of Goa and
Sikkim would be affected by this taxation policy and it would benefit them in some way. He suggested
that there would be no harm in treating Casinos differently or applying a different tax rate compared to
other activities.
6.43 The Hon'ble Member from Meghalaya suggested that since Betting and Gambling were already
included in Entry 6 giving different treatment to Casinos would create confusion. He proposed that
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either the two States could tax Casinos outside the GST regime or the definition of full face-value could
be worked upon to suit the affected States.
6.44 The Hon'ble Member from Goa requested that Casinos can be taxed based on the GGR
mechanism and suggested that the Council could review this decision if it does not work out as expected.
6.45 Addressing the concerns raised by the Hon'ble Member from Goa, the Hon’ble Chairperson
requested to have trust in the Council and its functioning, highlighting that the Council is taking a
rigorous approach to find a solution that benefits every industry and State.
6.46 In light of the urgency to resolve this long-standing issue, the Hon’ble Chairperson urged the
Council to come to a final decision. The Hon’ble Chairperson stressed that the solution should not be
too burdensome which may lead to the closure of any industry while also maintaining moral correctness.
6.47 The Hon'ble Member from Goa requested that Casinos should be taxed at an abatement of 60%
resulting in an effective tax rate of 11.2% which is around 12% and then casino industry would survive.
6.48 The Hon'ble Member from Uttar Pradesh then expressed that it is neither socially nor morally
right to support any State in the name of Casino and it will give wrong message to the public. He further
added that Goa may be facilitated by other means but not through the measure as suggested.
6.49 Considering the viewpoints expressed by the majority of States, the Hon’ble Chairperson stated
that since the proposal of the Hon'ble Member from Goa was not acceptable to the Council, the decision
was to tax Casinos at the rate of 28% on their full-face value.
Decision: The Council decided to clarify that actionable claims supplied in Casinos, Race course
and online gaming are also under the purview of GST to be taxed at the rate of 28% on full face
value irrespective of whether the activities are a game of skill or chance. Accordingly, the law
may be amended to provide clarity on the matter.
7. Agenda Item 6: Recommendations of the 18th and 19th IT Grievance Redressal Committee for
approval/decision of the GST Council
7.1 The Secretary requested JS, GST Council Secretariat to present the agenda item regarding
recommendations of the 18th and 19th meetings of the IT Grievance Redressal Committee (ITGRC)
before the Council.
7.2 JS, GST Council Secretariat then presented the recommendations of the 18th and 19th meetings
of the IT Grievance Redressal Committee (ITGRC) on the data fixes carried out by GSTN as per the
Standard Operating Procedure approved by the Council, as detailed in the agenda notes.
7.3 The Secretary then sought the comments of the Hon’ble Members of the Council on the
recommendations of ITGRC and the Council approved the same.

Decision: The GST Council approved the recommendations made by the ITGRC during its 18th
and 19th meetings.


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8. Agenda Item 7: Scheme of budgetary support under GST regime in lieu of earlier excise duty
exemption schemes to eligible manufacturing units under different Industrial Promotion Schemes
of the Government of India
8.1 The Secretary introduced the agenda regarding scheme of budgetary support under GST
regime in lieu of earlier excise duty exemption schemes. The Secretary informed the Council that the
issue arose because of the Hon’ble Supreme Court’s judgement dated 17.10.2022 in the case of M/s
Hero Motocorp Ltd. and Sun Pharma Laboratories Ltd. Vs Union of India & Ors. wherein the Hon’ble
Court held that the appellant’s claim based on promissory estoppel was without substance, however,
their claim deserved due consideration and allowed the appellants to represent before the concerned
State Governments and the GST Council. The Hon’ble Court directed the Council and the State
Governments to consider representations made by the appellants on the subject. The Secretary informed
the Council that the issue had been discussed in an earlier meeting and it had been decided that the
decision to continue with any incentive given to specific industries in existing industrial policies of
States or through any schemes of the Central Government, shall be with the concerned State or Central
Government.
8.2 The Secretary stated that there appeared to be no need to revisit the decision and that the
Council may reject the representations so received in this regard. In the officers’ meeting, the States
had expressed their inability to devise such a scheme as they were already implementing other
incentive schemes.
Decision: The Council agreed to continue with the existing scheme of budgetary support
whereby reimbursement of 58% of the net CGST and 29% of net IGST was granted to the
eligible manufacturing units in specified States and rejected the representations received for the
balance 42% of the net CGST and 21% of net IGST.

9. Agenda Item 8: Ad-hoc Exemptions Order(s) issued under Section 25(2) of Customs Act, 1962
to be placed before the GST Council for information.
9.1 In the 26th GST Council meeting held on 10th March, 2018, it was decided that all ad hoc
exemption orders issued with the approval of Hon’ble Finance Minister as per the guidelines contained
in Circular No. 09/2014-Customs dated 19th August, 2014, as was the case prior to the implementation
of GST, shall be placed before the GST Council for information.
9.2 Accordingly, the ad hoc exemption orders issued on 28th March, 2023 on request from Shri
Maneesh P.M. for exemption from payment of IGST under sub- section (7) of section 3 of the Customs
Tariff Act, 1975 on import of drug Injection Qarziba for baby Niharika G.M. was placed before the
Council.
Decision: The Council took note of the ad hoc exemption order.
10. Agenda Item 9: Report of Group of Ministers (GoM) on GST System Reforms
10.1 The Secretary requested the Hon’ble Member from State of Maharashtra to present Agenda Item
9 i.e. the Report of Group of Ministers (GoM) on GST System Reforms. The Member stated that the
Commissioner of State taxes would be making the presentation on the report.
10.2 The Commissioner of State taxes, Maharashtra made a presentation (Annexure -6). He informed
the Council that the GoM on GST System Reforms was formed on 18th September, 2021 and the main
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Terms of Reference were to suggest changes in the business processes and IT Systems to plug revenue
leakages, suggest better measure for compliance and revenue augmentation and to co-ordinate between
different tax authorities. The GoM comprises Members from the States of Maharashtra, Haryana, Delhi,
Assam, Andhra Pradesh, Odisha, Tamil Nadu, and Chhattisgarh. He further stated that this GoM is a
Standing GoM and submits its report periodically as and when meetings are held. He informed that the
GoM has held three meetings to date and that the report of the 2nd Meeting held on 10th February, 2022
was tabled and accepted by the Council in its 47th Meeting.
10.3 He further informed the Council that the 3rd Meeting of the GoM was held on 13th February,
2023 and that the recommendations of this third meeting are being tabled before the Council. He stated
that the GoM in its third meeting considered 6 agenda items and that they would be taken up
individually.
10.4 The first agenda item that was considered by the GoM was regarding the hard locking of Table-
4 of GSTR-3B and it is basically about the credit that is being claimed in FORM GSTR-3B to be locked
with the credit that is available in the FORM GSTR-2A. He informed the Council that the GoM after
due deliberations has concluded that the hard locking of Table-4 of GSTR-3B is not feasible as of now
as there are many corner situations that would cause inconvenience to the taxpayers if hard locking is
done. The GoM as a first step has recommended that a rule based on gap in ITC utilization can be
implemented in a phased manner on similar lines as mismatch between GSTR-1/3B system which is
already under implementation.
10.5 The second agenda item that was considered by the GoM was regarding the tracking and
identification of Non-Existent Tax Payers (NETP). He stated that with respect to fake entities detected
there is a need to have a national database as it will help in the tracking and recovery of fake ITC flow
credit. Having a computerized system will help in tracking these fake entities spread across different
States. He also stated that many commonalities are observed in these fake entities such as they use the
same mobile number, PAN number, Aadhar etc. and having a common repository will enable sharing
of these data across various States. The major recommendations made by the GoM with respect to this
agenda item are the need to formulate an SoP for handling these NETPs, a uniform policy of ab-initio
cancellation of these NETPs across State/CBIC zones and to develop a System driven solution to
facilitate the declaration of NETPs by the tax administrations and to develop a System based
communication regarding recipients of ITC from NETP, among the various States tax administrations
for smooth coordination of follow-up investigations.
10.6. The third agenda item that was considered by the GoM was regarding the Reporting of
transactions by payment gateways & banks. He stated that the monitoring of B2C transactions is at
present weak and that at present GSTN is unable to validate these transactions. It was recommended by
the GoM that the data available from NPCI, RuPay, and VISA/Master Card can be compiled and this
can be checked against the details provided by the registered person regarding turnover. He further
informed the Council that this recommendation is in its initial stage and that the details need to be
worked out. The GoM has recommended forming a committee to develop a detailed methodology and
to hold detailed consultations with NPCI and RBI to implement this recommendation.
10.7 The fourth agenda item that was considered by the GoM was regarding the HSN-level reporting
in GSTR-1. Commissioner Maharashtra informed the Council that in the initial phases, the dealers are
not disclosing the full turnover commodity wise and therefore, it is proposed to make this compulsory
in a phased manner. The GoM has recommended a phase-wise and time-bound approach to be adopted
for action against non-compliant taxpayers with nudging messages and e-mails in the initial phase and
blocking of GSTR-1 to be considered for failure to fill HSN details in the later phase.
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10.8 The fifth agenda item that was considered by the GoM was regarding the proposal for integration
of Income Tax, ICEGATE and other data points to address underreporting of supplies and to address
the issue of under-reporting of Import of Services. On integration with Income Tax and ICEGATE the
GoM suggested that DoR may coordinate the same. The benefit to GST on matching with these data
points are quite obvious. In this regard, the Hon’ble Member from Karnataka suggested the committee
could also explore the possibility of integrating the data that is available with the Ministry of Corporate
Affairs.
10.9 The Commissioner of State Taxes Maharashtra further stated that at present all supplier data on
goods and services are triangulated on the domestic side, but for the import of services, there is no
triangulation of data as it is an independent field reported by the taxpayer. It was also informed to the
Council that data is available with RBI for foreign remittance and the proposal was to explore the
possibility of triangulating foreign remittance data with RBI with the import of services data reported
by the registered person. He further informed the Council that this recommendation is in its initial stage
and that the GoM has recommended forming a committee of Officers from TPRU-1, GSTN, Centre,
Maharashtra, and RBI to make a detailed report on this proposal.
10.10 The sixth agenda item that was considered by the GoM was regarding the development of
MIS. He also informed the Council that two requests were received from State of Tamil Nadu and
Odisha for the development of MIS. The first request was from Odisha for the development of MIS for
commodities liable for GST under RCM and the second request was from Tamil Nadu for the
development of MIS for auto-populated interest on account of late payment of tax in cases where GSTR
3B is filed late. He informed the Council that the GoM has approved the development of MIS.
10.11 He further informed the Council that the GoM has felt that the entire GST network and system
should move towards strengthening the registration process by using biometric validations and premises
verification, controlling the flow of fake ITC at both ends, i.e. the recipient and the supplier of a supply
and also expanding the use of third-party data for better forecasting of turnover and other verifications
of taxpayers.
10.12 The Secretary proposed that the Council could accept the report of the GoM and that the
recommendations made by the GoM can be implemented by GSTN in consultation with the Law
committee.
Decision: The Council accepted the recommendations made by the GoM on System Reforms.

11. Agenda Item 10: Proposal for creation of State Co-ordination Committee comprising of GST
authorities from the State and Central Tax Administration
11.1 The Secretary presented the Agenda No. 10 regarding creation of State Level Co-ordination
Committee comprising GST authorities from the State and Central Tax Administration. He informed
the Council that the proposal had come up during the National Coordination Committee meeting that
was held in April, 2023 with the tax authorities from both Centre and State.
11.2 The Secretary informed the Council that the Committee would be co-chaired by the Chief
Commissioner/ Commissioner of CGST/SGST and that they shall be co-convener on rotational basis
for one year each. He further stated that the Committee shall meet at least once every quarter or as the
co-Chairs decide. He further informed that the committee will deliberate on co-ordination issues relation
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to enforcement, investigation, audit, grievances and any other matter as agreed to by co-Chairs. He also
informed that the agenda was discussed in detail in the Officers’ Meeting.
11.3 The Hon’ble Member from Uttar Pradesh welcomed the proposal and stated that Committee
would be a welcome step towards co-ordination between tax authorities.
11.4 The Secretary further requested the Council that, once orders are issued for constitution of
Committee, to ensure that the Committee meets regularly so that concerted and coordinated efforts can
be made towards coordination at State level.
Decision: The Council approved the proposal for creation of State Co-ordination Committee
comprising of GST authorities from the State and Central Tax Administration.

12. Agenda 11: Implementation of GSTAT consequent to passing of Finance Act, 2023
12.1 The following issues under the agenda were placed for consideration of the GST Council:
a. The GST Council may recommend a suitable date for notifying the amendments to CGST
Act, 2017 made vide Finance Act, 2023. Accordingly, the States/UTs with legislature may
also notify the corresponding amendments in their respective Acts. The GSTAT would be
constituted after these amendments are notified.
b. As per Section 110(4)(b)(iii), the Chief Secretary of a State is to be nominated by the GST
Council as a Member of the Search Cum Selection Committee for all other cases than the
Technical Member (State) of the State Tribunal.
c. For States having a common Bench but separate High Court, it may be clarified that the
appeal arising out of GSTAT order in such cases will fall within the jurisdiction of the High
Court of the State where the taxpayer is located.
d. The proposed Number of Benches along with their jurisdiction in States /UTs with legislature.

12.2 The Secretary presented the agenda and made a brief presentation. The presentation (attached
as Annexure-7) summarized the State-wise Benches requested (sorted in descending order of the
number of taxpayers in each State) along with domestic GST collection figures from each State i.e.
collections net of IGST on imports. He brought to the notice of the Council that each Bench comprises 4
Members and, thus, each Bench effectively means two functional Benches.
12.3 The Hon’ble Member from Uttar Pradesh stated that Uttar Pradesh has the highest number of
taxpayers and the highest population in the country with a wide geographical expanse. He informed the
Council that for these reasons they have proposed five Benches at Lucknow, Agra, Prayagraj, Varanasi
and Ghaziabad. This had been cleared by the State Cabinet earlier as also discussed by the Council in
its 39th and 40th meetings. This may be cleared without reduction.
12.4 The Hon’ble Member from Maharashtra stated that Maharashtra has 20% share in the GST
revenue and appealed that as proposed seven Tribunals in their State should be recommended.
12.5 The Hon’ble Member from Tamil Nadu requested for three Tribunal Benches at Chennai,
Madurai and either at Coimbatore or Salem considering their population. While the request from the
State Government had not been sent earlier, their suggestion may be taken now.
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12.6 The Hon’ble Member from Punjab stated that they propose to form two Tribunal Benches. They
have communicated for only for one Bench at Chandigarh/Mohali and will be deciding on the location
of the second Bench soon and communicate the same.
12.7 The Hon’ble Member from Andhra Pradesh stated that considering the geographical diversity
in the State and poor road connectivity in certain areas, they have proposed three Benches.
12.8 The Secretary brought out the total number of Benches suggested by the States is coming to
around 50. This means selection of nearly 200 Members. In the initial days, the workload with the
Benches may not justify this high number. Accordingly, in the Officers’ meeting, States were requested
to begin with few Benches. It needs to be kept in mind that one Bench in effect means two functional
Benches. If we were to proceed in one go to do these many recruitments, there may be some compromise
on the quality. It will be a better idea to proceed in a staggered manner while agreeing to the suggestions
from the States.
12.9 The Secretary suggested that initially, all the State Capitals may have one Bench (other than
North-Eastern States and Sikkim). In addition, there may be Benches at location of High Court Benches.
For instance, U.P. has High Court Benches at Lucknow and Allahabad. They can have two Benches,
which will mean four functional Benches. Similarly, Maharashtra and Rajasthan can have two Benches.
This is only in first phase and as they are filled up and made operational, we can proceed to higher
numbers. The requests received can be approved, subject to the condition that in the initial phase, the
process is started with Benches at State Capitals and places where High Court Benches are located.
12.10 The Hon’ble Member from Uttar Pradesh stated that at least three Benches should be
recommended in the first phase and the request made should not be cancelled.
12.11 The Hon’ble Chairperson clarified that the Benches as proposed by the States were not being
reduced but the idea was to start with fewer Benches in the initial phase. The other Benches may be set
up subsequently.
12.12 The Hon’ble Member from Kerala brought out the distance factor between the Capital city and
Ernakulum where the High Court is located. Both of them can have one Bench of two Members each.
Agreeing with the suggestion, the Revenue Secretary clarified that the same can be done at their level
by setting up sitting/ circuit Benches. The same can be enabled so that more cities can be covered by
one State Bench. He stated that State Bench and sitting/circuit Bench could be located in different cities
for wider geographical representations with two Members each.
12.13 The Hon’ble Member from Chhattisgarh stated they were in agreement with this arrangement
and would have two Benches starting with Raipur and then at Bilaspur.
12.14 The Secretary summed up that post discussions the final consensus is to have limited number of
Benches to begin in first phase. On the issues of jurisdiction of the Benches, the Secretary informed that
the information would be collected from the States which may need to provide the details of jurisdiction
of proposed Benches and with the approval of the Hon’ble Chairperson, the same would be placed
before the Council for ratification.
12.15 The Secretary further suggested that the Chief Secretary of Uttar Pradesh or Maharashtra may
be nominated as a Member of the Search cum Selection Committee. He stated that these two States
have the highest number of taxpayers. The Hon’ble Member from Karnataka suggested that Chief
Secretary Karnataka may be nominated as a Member of the Search cum Selection Committee. The
Secretary stated that if it was agreeable to all, the Chief Secretary of Maharashtra may be nominated as
a Member of the Search cum Selection Committee as Maharashtra had the largest share in GST revenue
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and the second largest number of GST taxpayers in the country. He also suggested that this nomination
may be for one year and be made on a rotation basis for subsequent years. He brought out that selections
will be required to be done every year due to constitution of new Benches, turnover of members due to
resignations, retirements etc.
Decisions:
a. The Council recommended that provisions of the Finance Act, 2023 pertaining to the GST
Appellate Tribunal may be notified by the Centre with effect from 01.08.2023. This will
pave the way for the early setting up of the Benches of the GST Appellate Tribunal.
b. Further, the Council recommended that the Chief Secretary of Maharashtra be
nominated as one of the Member of the Search cum Selection committee in terms of
Section 110(4)(b)(iii) of the CGST Act 2017 for a period of one year.
c. It was clarified that for states having a common Bench but separate High Court, an appeal
arising out of GSTAT order will fall within the jurisdiction of the High Court of the State
where the taxpayer is located.
d. Regarding the number of State Benches, the Council recommended constituting the
Benches as per proposal of the States. However, they may be operationalized in a phased
manner based on the case load. The Council recommended to initially operationalize one
Bench each in the major States. However, for States having High Court Benches at two
or more places in the State, or large number of tax payers, it recommended to initially
operationalize more than one Bench also. Moreover, a Bench may have sitting at more
than one location (with two members at each location) which will enable more cities to be
covered by the State Benches.
e. The jurisdiction of the Benches may be decided in consultation with the States concerned,
with the approval of the Hon’ble Chairperson, and placed before the Council for
ratification.

13. Agenda Item 12: Performance Report of Competition Commission of India (CCI) for month
of December, 2022 and 4th quarter of the F.Y 2022-23 along with the Performance Report of State
Level Screening Committee (SLSC), Standing Committee (SC) and Directorate General of Anti-
Profiteering (DGAP) for 3rd quarter and 4th quarter of the F.Y 2022-23
13.1 The Secretary presented the Agenda No. 12 regarding Performance Report of Competition
Commission of India (CCI) for month of December, 2022 and 4th quarter of the F.Y 2022-23 along with
the Performance Report of State Level Screening Committee (SLSC), Standing Committee (SC) and
Directorate General of Anti- Profiteering (DGAP) for 3rd quarter and 4th quarter of the F.Y 2022-23 for
the information of the Council.
Decision: The Council took note of the same and approved the Agenda.
14. Agenda 13- Request for extension of due dates for filing GSTR-7, GSTR-1 & GSTR-3B for
the month of April, May and June 2023 and extension of Amnesty Schemes in the State of
Manipur.
14.1 The Pr. Commissioner, GST Policy stated that a request has been received from State of Manipur
for extension of due dates for filing of FORM GSTR 7, FORM GSTR-1 and FORM GSTR-3B for the
months of April, May and June 2023 till 31.07.2023 for taxpayers of Manipur, due to prevailing law-
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and-order situation in the State. He informed that already, extension of due dates for filing of FORM
GSTR 7, FORM GSTR-1 and FORM GSTR-3B for the months of April 2023 and May 2023 has been
granted till 30th June 2023.
14.2 He also informed that State of Manipur has also requested for extension of the Amnesty schemes
announced in the last Council meeting till 31st July 2023 in State of Manipur. He mentioned that these
amnesty schemes were notified through notifications dated 31st March, 2023, on basis of the
recommendations of GST Council made in 49th meeting, and the compliances as per the said amnesty
schemes were to be done by 30th June, 2023. The details of amnesty schemes are as under:
(i) Amnesty to GSTR-4 non-filers was provided vide Notification No. 02/2023-CT;
(ii) time limit for application for revocation of cancellation of registration was
conditionally extended vide Notification No. 03/2023-CT;
(iii) Amnesty scheme for deemed withdrawal of assessment orders issued under Section
62 was provided vide Notification No. 06/2023-CT;
(iv) Amnesty to GSTR-9 non-filers was provided vide Notification No. 07/2023-CT;
(v) Amnesty to GSTR-10 non-filers was provided vide Notification No. 08/2023-CT;
14.3 He also added that similar representations for extension of date of amnesty schemes have also
been received from various other trade associations from other parts of the countries also.
14.4 He informed that the feasibility of implementing these requests was got examined through
GSTN (Goods and Services Tax Network). GSTN has informed that while they can quickly make
changes on an all-India basis for the extension of Amnesty schemes, implementing it specifically for a
particular State would require more time due to coding requirements.
14.5 The issue was deliberated in Officers’ meeting held on 10th July 2023 and it was recommended
by the Officers to extend the due dates for filing of FORM GSTR 7, FORM GSTR-1 and FORM GSTR-
3B for the months of April, May and June 2023 till 31.07.2023 for the taxpayers of State of Manipur.
The Officers further recommended that the Amnesty schemes notified vide notifications dated
31.03.2023, as detailed in the Agenda, may be extended till 31st August, 2023 for all taxpayers across
the country.
Decision: The Council agreed with the said recommendation made by the Officers in the Officers’
meeting.
15. Agenda Item 14: Review of the Revenue position under Goods and Service Tax

15.1 The Secretary presented the agenda on review of revenue position under GST and informed
the Council that there were press releases from time to time indicating the revenue position. The
Secretary to the Council informed that there is growth in the revenue of about 12% annually.
15.2 The Director (State Taxes), DoR stated that the average monthly collection of GST comes to
about Rs. 1.70 Lakh Crore. Regarding unsettled IGST, the Director (State Taxes), DoR informed that
compared to last year this year the balance is negative. However, the situation was improving. The
Compensation Account was also in negative.
15.3 The Secretary informed the Council that the Compensation amount to all the States who had
submitted AG Certificate had been released and there was no pendency. The Secretary requested the
other States who had not submitted their AG Certificates to submit it on priority so that their payments
could also be released in time.
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15.4 The Hon’ble Member from Telangana stated that their IGST settlement and Compensation
payment were still pending. To this, the Director (State Taxes), DoR informed that the amount as per
the original AG Certificate submitted by the State had been released. The amount as per revised AG
Certificate would be released in due course as and when revised Certificate was received in DoR.
Further, regarding IGST Settlement, the Director (State Taxes), DoR informed that they were facing
certain accounting issues. Those issues were discussed with Pr. CCA, CBIC. The amount due under
IGST Settlement would be released after resolution of the accounting issues.
15.5 The Hon’ble Member from Andhra Pradesh also pointed out similar issue for the Financial
Year 2018-19 and 2019-20. The Director (State Taxes), DoR informed that CAG had certified the
amount but the Certificate was yet to be received by DoR. The due amount would be released after
receipt of the Certificate.
16. Agenda 15: Any other agenda with the permission of the Chairperson
16.1 The Hon’ble Member from Delhi brought to attention concerns over recent notification
including Goods and Services Tax Network (GSTN) under the purview of the Prevention of Money-
laundering Act (PMLA) without any formal discussion in the GST Council. The Hon’ble Member
requested the Chairperson to take up the matter for discussion.

16.2 The Hon’ble Member of Tamil Nadu objected the notification issued by Union Government on
PMLA that it is against the interests of traders and against the basic objective of decriminalizing
violations under the Goods and services Tax Act. This will affect traders across the country. Tamil
Nadu is opposed to this.
16.3 The Hon’ble Member from Punjab also requested the Council to discuss the matter and address
the apprehensions of the trade regarding the Notification.
16.4 The Hon’ble Member from the West Bengal enquired about the necessity of publishing the
notification. She stated that law enforcing agencies could have shared the data related to any fraud
detection without even having any notification brought to that effect. Therefore, this matter should have
necessarily been discussed in the Council before notifying anything that affects GST agencies.
16.5 The Hon’ble Member from Rajasthan also requested the Council to take up the matter for
discussion on an urgent basis. Any defaults in tax payments were already being investigated by GST
authorities and bringing enforcement of laws like PMLA in taxation matters would further create fear
among traders.
16.6 The Hon’ble Member from Telangana informed the Council that there were many apprehensions
among the industry members about the notification. These apprehensions should be addressed by way
of an Agenda or a GoM might be constituted for deeper analysis. The matter may then be taken up in
the next Council meeting and the implementation of the notification be deferred till that time.
16.7 The Hon’ble Member from Karnataka stated that since the issue involved sharing of data with
GSTN, it was incumbent upon the Council to discuss the matter.
16.8 The Secretary to the Council clarified that the Notification under scrutiny is under Prevention
of Money Laundering Act and is not under GST law. Secondly, the purpose of the notification was to
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equip and empower tax administration. As per the notification, Director, Financial Intelligence Unit
would share information with GSTN regarding suspicious transactions filed by financial institutions.
He read out the provisions of section 66, PMLA under which notification was issued and clarified that
under these provisions of the Act, GSTN would only get information and the said reaction does not
mandate GSTN to share any information. Such information shared by FIU would be further shared with
concerned State and Central GST authorities and that information would empower the authorities to
decide further course of action depending on merits of the case. Thirdly, this information was not
circulated by Directorate of Enforcement but Director, FIU whose duty was to collect information
regarding suspicious persons and suspicious transactions and communicate it to law enforcing agencies
including ED, CBI, State Police, income tax and GSTN. This information was already being shared
with about 30 other law enforcing agencies and the facility of sharing was being extended to GSTN so
that the information could be shared with State and Central authorities too. Instead of sharing this
information with each State or Central zone separately, the information would be shared with GSTN
which was a common node for all tax agencies. In light of the discussions, it might be concluded that
the notification does not give extraordinary powers to the tax authorities.
16.9 The Hon’ble Member from Maharashtra apprised the Council that no representations raising
objections against the notification were received from any association in the State of Maharashtra. The
Hon’ble Member highlighted that since the inception of the law, 5000 cases had been registered for the
period 2005 to 2023. 2200 cases were registered between 2005 and 2014 while 2800 cases were
registered between 2014 and 2023. Further, the total number of registrations in GST are 1 Crore 40 lakh
approximately and the number of cases of violation were 5000 only.
16.10 The Hon’ble Member from Chhattisgarh pointed out that when PML Act was brought into
effect, its preamble quoted the obligation of the country under United Nation Convention under which
it was adopted. So, it was not foreseen at that time that such laws had something to do with tax regimes
like GST. The aim was to target illicit drug trafficking, destabilization of the country, etc.
16.10 The Secretary to the Council reiterated that the provisions in the notification were not meant for
empowering any Central tax agency with extraordinary powers. The information would be shared by
FIU with GSTN electronically. The information would, further, be shared with Central and State GST
authorities and it would be upon them to decide if any action was to be initiated.
17. In the end, the Secretary thanked the Union Finance Minister, the MoS, all the Members
of the Council, and all the officers who had come from States, Centre, GSTN and the officers from
Secretariat.

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Annexure- 1
List of Hon'ble Ministers from States/UTs who participated in the 50th Meeting of the GST
Council held on 11th July, 2023
S.
No.
Centre/States/Uts
Name of Hon'ble
Minister
Charge
1 GOI Smt. Nirmala Sitharaman Union Finance Minister
2 GOI Shri. Pankaj Chaudhary Minister of State for Finance
3 Andhra Pradesh Shri Buggana
Rajendranath
Minister for Finance, Planning,
Legislative Affairs, Commercial
Taxes and Skill Development &
Training
4 Arunachal Pradesh Shri Chowna Mein Hon'ble Deputy Chief Minister-
cum-Finance Minister
5 Assam Smt. Ajanta Neog Finance Minister
6 Chhattisgarh Shri T.S.Singh Deo Deputy Chief Minister
7 Delhi Smt. Atishi Marlena Finance Minister
8 Goa Shri Mauvin Godinho Minister for Industries, Transport,
Panchayati Raj and Protocol
9 Gujarat Shri Kanubhai Desai Minister for Finance
10 Himachal Pradesh Shri Harshwardhan
Chauhan
Industries Minister
11 Jammu and Kashmir Shri Rajeev Rai
Bhatnagar
Advisor to Hon'ble Lieutenant
Governor, UT of J&K
12 Jharkhand Dr. Rameshwar Oraon Minister for Finance, Commercial
Taxes and Food, Public
Distribution and Consumer Affairs
13 Karnataka Shri Krishna Byre Gowda Minister for Revenue Department
14 Kerala Shri K. N. Balagopal Finance Minister
15 Maharashtra Shri Sudhir Mungantiwar Minister for Forest and Cultural
Affairs
16 Manipur Dr. Sapam Ranjan Singh Minister for Medical, Health &
Family Welfare Department and
Publicity & Information
Department
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17 Meghalaya Shri Conrad K. Sangma Chief Minister
18 Meghalaya Shri.A.T. Mondal Cabinet Minister, Community &
Rural Development, Power
Department, Taxation Department
19 Nagaland Shri K.G Kenye Minister for Power and Parliament
Affairs
20 Odisha Shri Bikram Keshari
Arukha
Minister for Finance
21 Punjab Shri Harpal Singh
Cheema
Finance Minister
22 Puducherry Shri K.
Lakshminarayanan
Minister for Public Works
23 Rajasthan Shri Shanti Kumar
Dhariwal
Minister of Local Self-
Government, Urban Development
and Housing, Law and Legal
Affairs, Legal Consultancy Office,
Parliamentary Affairs, Elections
24 Sikkim Shri B. S. Panth Minister of Tourism & Civil
Aviation and Commerce &
Industries
25 Tamil Nadu Shri Thangam Thennarasu Minister for Finance and Human
Resources Management
26 Telangana Shri T. Harish Rao Minister for Finance, Health,
Medical & Family Welfare
27 Uttar Pradesh Shri Suresh Kumar
Khanna
Minister of Finance, Parliamentary
Affairs
28 Uttarakhand Shri Premchand Aggarwal Minister of Finance, Urban
Development, Housing,
Legislative and Parliamentary
Affairs, Reorganisation and
Census
29 West Bengal Smt. Chandrima
Bhattacharya
Minister of State for Finance


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Annexure-2.

List of Officers from Centre and the States/UTs who participated in the 50th Meeting of the
GST Council held on 11th July, 2023
S.No. Centre/States/Uts Name of the Officer Designation/Charge
1
Government of
India
Shri Sanjay Malhotra Revenue Secretary
2
Government of
India
Shri Vivek Johri Chairman, CBIC
3
Government of
India
Shri Sanjay Kumar Agarwal
Member(Compliance
Management),CBIC
4
Government of
India
Shri Shashank Priya Member (GST),CBIC
5
Government of
India
Shri Vivek Ranjan Member (Tax Policy)
6
Government of
India
Shri Pankaj Kumar Singh
Additional Secretary (GST Council
Secretariat)
7
Government of
India
Shri Sanjay Mangal Principal Commissioner
8 GSTN Shri Manish Kumar Sinha CEO
9 GSTN Shri Dheeraj Rastogi EVP
10
Government of
India
Ms. Limatula Yaden Joint Secretrary
11
Government of
India
Ms. Ashima Bansal Joint Secretary
12
Government of
India
Ms. B.Sumidaa Devi Joint Secretary
13
Government of
India
Shri Surjit Bhujabal Principal Director General, DGGI
14
Government of
India
Shri Nitish Kumar Sinha
Principal Additional Director
General, DGGI (Hqrs.)
15
Government of
India
Shri S.S. Nakul PS to FM
16
Government of
India
Shri Sernya Bhutia 1ST PA TO FM
17
Government of
India
Shri Kumar Ravikant Singh PS to MoS Finance
18
Government of
India
Shri Dhruv Narayan Srivastav 1st PA to MoS Finance
19
Government of
India Shri Deepak Kapoor OSD to Revenue Secretary
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20
Government of
India
Shri D. P. Misra OSD to Chairman, CBIC
21
Government of
India
Dr N Gandhi Kumar Director (State Taxes)
22
Government of
India
Shri Alok Kumar Additional Commissioner
23
Government of
India
Shri Raghavendra Pal Singh Additional Commissioner
24
Government of
India
Dr. Gurbaz Sandhu Additional Commissioner
25
Government of
India
Shri Pramod Kumar OSD Commissioner in-situ
26
Government of
India
Ms Puneeta Bedi OSD
27
Government of
India
Shri Rakesh Dahiya Deputy Secretary
28
Government of
India
Ms. Amreeta Titus

Deputy Secretary
29
Government of
India
Shri Nitesh Gupta Deputy Commissioner
30
Government of
India
Shri Amit Samdariya Deputy Commissioner
31
Government of
India
Ms. Neha Yadav Deputy Commissioner
32
Government of
India
Ms. Soumya Deputy Commissioner
33
Government of
India
Shri Manish Deo Mishra Deputy Commissioner
34
Government of
India
Shri Raushan Kumar Deputy Commissioner
35
Government of
India
Shri Sunil Kumar Under Secretary
36
Government of
India
Shri Vikram Wanere Under Secretary
37
Government of
India
Shri Rahul Kumar Under Secretary
38
Government of
India
Ms. Smita Roy Technical Officer
39
Government of
India
Ms. Anna Sosa Thomas Technical Officer
40
Government of
India
Shri Nitin Gupta Technical Officer
41
Government of
India
Shri Sameer Shivajirao Patil Technical Officer
42
Government of
India
Dr. Sorabh Badaye Deputy Director
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43
Government of
India
Shri Ashok Kumar Inspector
44
Government of
India
Shri Anil Bhandari Inspector
45 GSTN
Shri Naveen Agarwal Deputy Commissioner
46
Government of
India
Dr. Pragya Paliwal Gaur Additional Director General
47
Government of
India
Shri Kush Mohan Nahar Media & Communication Officer
48
Government of
India
Ms. Manju Kumar Chief Postmaster General
49
Government of
India
Ms. Binti Choudhury Director (Headquarter & Operations)
50
Government of
India
Shri Amit Kumar ADM (PLI & Philately)
51
Government of
India
Shri Sachin Kashyap Inspector of Posts (Philately)
52
Government of
India
Shri Rakesh Kumar Inspector of Posts (Philately)
53
Government of
India
Shri Aman Prakash Gaurav PRO
54
Government of
India
Shri Rajeev Ranjan Bharti Postal Assistant
55
GST Council
Secretariat
Shri Kshitendra Verma Director
56
GST Council
Secretariat
Shri S.S.Shardool Director
57
GST Council
Secretariat
Shri Joginder Singh Mor Under Secretary
58
GST Council
Secretariat
Ms. Reshma R. Kurup Under Secretary
59
GST Council
Secretariat
Ms. Priya Sethi Superintendent
60
GST Council
Secretariat
Shri Dharambir Superintendent
61
GST Council
Secretariat
Shri Irfan Zakir Superintendent
62
GST Council
Secretariat
Shri Naveen Kumar Superintendent
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63
GST Council
Secretariat
Shri Sachin Goel Superintendent
64
GST Council
Secretariat
Ms. Ambika Rani Superintendent
65
GST Council
Secretariat
Shri Niranjan Kishore Superintendent
66
GST Council
Secretariat
Shri Rakesh Joshi Superintendent
67
GST Council
Secretariat
Shri Vijay Malik Inspector
68
GST Council
Secretariat
Shri Padam Singh Inspector
69
GST Council
Secretariat
Shri Rohit Sharma Inspector
70
GST Council
Secretariat
Shri Ashwani Sharma ASO
71
GST Council
Secretariat
Shri Karan Arora ASO
72
GST Council
Secretariat
Shri Pankaj Dhaka Tax Assistant
73
GST Council
Secretariat
Shri Paresh Garg Tax Assistant
74
GST Council
Secretariat
Shri Shyam Bihari Meena Tax Assistant
75
GST Council
Secretariat
Shri Vikas Kumar Tax Assistant
76
Andhra Pradesh Shri N. Gulzar Secretary Finance(CT)
76
Andhra Pradesh Shri N. Gulzar Secretary Finance(CT)
77 Andhra Pradesh Shri M. Girija Sankar Chief Commissioner(ST)
78 Andhra Pradesh Shri J. V. M. Sarma Additional Commissioner(ST) Policy
79
Arunachal Pradesh Ms. Y. W. Ringu Secretary (Tax & Excise)
80
Arunachal Pradesh Shri Lobsang Tsering Commissioner (Tax & Excise)
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81 Arunachal Pradesh Shri Tapas Dutta
Deputy Commissioner-cum- SNO
(GST)
82
Assam Shri Rakesh Agarwalla Principal Commissioner of State Tax
83
Bihar Dr. Pratima
Commissioner cum Secretary
Commercial Taxes
84 Bihar Shri Arun Kumar Mishra Tax Expert Commercial Taxes
85
Bihar Ms. Ruby Joint Secretary Commercial Taxes
86
Bihar Shri Binod Kumar Jha Additional Commissioner State Tax
87 Chandigarh Shri Vijay Namdeorao Zade
Finance Secretary-cum-Secretary
Excise & Taxation
88
Chandigarh Shri Alok Passi
Assistant Excise and Taxation
Commissioner
89
Chhattisgarh Shri Himshikhar Gupta
Secretary, Commercial Tax (State
Tax)
90 Chhattisgarh Shri Ritesh Kumar Agrawal Commissionerof State Tax
91
Chhattisgarh Shri Tarun Kumar Kiran Deputy Commissioner
92
Chhattisgarh Shri Anand Sagar Singh PA to Hon'ble Minister
93
Delhi Shri A Anbarasu Principal Commissioner (State Tax)
94 Delhi Shri Awanish Kumar Special Commissioner (State Tax)
95
Delhi Shri Atish Kumar Joint Commissioner (Sate Tax)
96
Goa Shri S.S.Gill Commissioner of State Tax
97
Goa Shri Vishant S.N. Gaunekar
Additional Commissioner of State
Tax
98
Gujarat Shri J.P. Gupta
Additonal Chief Secretary, Finance
Department
99
Gujarat Shri Samir Vakil
Chief Commissioner of State Tax
(I/c)
100 Gujarat Shri Riddhesh Raval Joint Commissioner of State Tax
101 Haryana Shri Devinder Singh Kalyan
Principal Secretary to Government
Haryana, Excise and Taxation
Department.
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102 Haryana Shri Siddharth Jain
Additional Commissioner, GST,
Excise and taxation Department
103 Himachal Pradesh Shri Yunus
Commissioner State Taxes and
Excise
104 Himachal Pradesh Shri Rakesh Sharma
Additional Commissioner State
Taxes and Excise
105
Jammu and
Kashmir
Shri Santosh D. Vaidya
Principal Secretary, Finance
Department
106
Jammu and
Kashmir
Shri Shakeel Maqbool Additional Commissioner
107
Jharkhand Ms. Vipra Bhal Secretary, Commercial Taxes
108 Jharkhand Shri Santosh Kumar Vatsa Commissioner, Commercial Taxes
109
Karnataka Ms. C. Shikha Commissioner Commercial Tax
110
Karnataka Dr. Ravi Prasad Additional Commissioner CT
111
Kerala Shri Ajit Patil
Commissioner, State GST
Department
112 Kerala Shri Abraham Renn S Additional Commissioner-1
113
Kerala Dr. Shyjan D PS to Hon'ble Minister for Finance
114
Madhya Pradesh Shri Lokesh Kumar Jatav Commissioner of Commercial Tax
115
Madhya Pradesh Shri Manoj Kumar Choubey Additional Commissioner, State Tax
116
Maharashtra Ms Shaila A
Principal Secretary (Financial
Reforms)
117 Maharashtra Shri Rajeev Mital Commissioner of State Tax
118
Maharashtra Shri Manoj Kumar Narayanwal Deputy Commissioner
119
Maharashtra Shri Sudhir Rathod OSD to the Hon'ble Minister
120 Maharashtra Shri Rahul Gangurde OSD to the Hon'ble Minister
121
Maharashtra Shri Babasaheb Gore
OSD to the Commissioner of State
Tax
122
Maharashtra Anju Nimsarkar Infornation Officer
123
Manipur Ms. Mercina R. Panmei Commissioner of Taxes
124 Manipur Shri Y. Indrakumar Singh Assistant Commissioner of Taxes
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125
Meghalaya Shri Ramakrishna Chitturi Commissioner of Taxes
126
Meghalaya Shri L Khongsit Additional Commissioner of Taxes
127 Meghalaya Shri V R Challam Deputy Commissioner of Taxes
128
Meghalaya Shri Sanjay Goyal Commissioner & Secretary ERTS
129
Meghalaya Shri Shanborlang Warjri Deputy Secretary CM Office
130 Meghalaya Shri Mukesh Kumar OSD to CM
131
Meghalaya Shri Saidul Khan OSD to CM
132
Mizoram Shri R. Zosiamliana Commissioner of State Tax
133 Mizoram Shri Hrangthanmawia
Assistant Commissioner of State
Taxes
134
Nagaland Shri C Lima Imsong
Additional Commissioner of State
Taxes
135
Odisha Shri Nihar Ranjan Nayak
Additional Commissioner of CT &
GST
136 Odisha Shri Saumyajit Rout Joint Secretary, Finance Department
137
Odisha Shri Dinakrushna Kar PS to Hon'ble Minister
138
Punjab Shri Vikas Partap Financial Commissioner (Taxation)
139
Punjab Shri Kamal Kishor Yadav Commissioner of State Tax
140
Punjab Shri Ravneet Khurana
Additional Commissioner of State
Taxes (Audit)
141
Puducherry Shri P. Jawahar
Commissioner -cum- Secretary to
Govt. (Finance)
142 Puducherry Shri L. Mohamed Mansoor Commissioner of State Tax
143
Rajasthan Dr Ravi Kumar Surpur Chief Commissioner, State Tax
144
Rajasthan Shri Arvind Mishra Additional Commissioner, State Tax
145
Sikkim Shri Manoj Rai Commissioner (Commercial Taxes)
146 Tamil Nadu Shri T.Udhayachandran Principal Secretary, Finance
147
Tamil Nadu Shri Dheeraj Kumar
Principal Secretary/Commissioner of
Commercial Taxes
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148 Tamil Nadu Shri S. Subash Chandra Bose
Joint Commissioner (Policy &
Planning)
149
Telangana Ms. Neetu Prasad Commissioner of Commercial Taxes
150
Telangana Shri N Sai Kishore
Additional Commissioner
(ST)(Legal)
151 Telangana Ms. K Rupa Sowmya Deputy Commissioner (ST) EIU
152
Tripura Ms. Rakhi Biswas Chief Commissioner of State Tax
153
Tripura Shri Ashin Barman GST Nodal Officer
154
Uttarakhand Shri Dilip Javalkar Secretary Finance
155 Uttarakhand Dr. Ahmad Iqbal Commissioner of State Tax
156
Uttarakhand Shri B. S. Nagnyal Additional Commissioner
157
Uttarakhand Shri Anurag Mishra Joint Commissioner
158 Uttar Pradesh Shri Nitin Ramesh Gokarn Additional Chief Secretary, State Tax
159 Uttar Pradesh Ms. Ministhy S Commissioner, State Tax
160
Uttar Pradesh Shri Paritosh Kumar Mishra Deputy Commissioner, State Tax
161
Uttar Pradesh Shri Amit Pandey P.S. to Hon'ble Finance Minister, UP
162
West Bengal Dr. Manoj Pant
Additional Chief Secretary, Finance
Department
163 West Bengal Shri Khalid Aizaz Anwar Commissioner of State Tax
164
West Bengal Shri Rajib Sankar Sengupta
Senior Joint Commissioner of
Revenue
165
West Bengal Shri Shantanu Naha OSD to Hon'ble Minister


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Annexure-4

50th GST Council Meeting
Agenda item 4
Recommendations of Fitment Committee
on
Goods and Services
11th July, 2023


Summary of Discussion
in
Officers’ meeting
on
Recommendations of Fitment Committee





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Goods
• Total 35 issues examined
 Recommendations for making changes in GST rates/ issuing clarifications- 14
[Agenda 4 (a): Vol-I: Annexure-I :pages 216 to 225]
 Recommendations for making no change - 17
[Agenda 4 (b):Vol-I: Annexure-II: pages 226-237]
 Issues deferred for further examination – 4
[Agenda 4 (c): Vol-I: Annexure-III :pages 238 to 246]


Services
• Total 16 issues examined
 Recommendations for making changes in GST rates/ issuing clarifications- 7
-[Agenda 4 (d): Vol –I: Annexure-IV :pages 247 to 260]
 Recommendations for making no change - 3 - [Agenda 4 (e): Vol –I: Annexure-V: pages 261-264]
 Issues deferred for further examination – 6 -[Agenda 4 (f) : Vol –I: Annexure-VI :pages 265 to 274]
• Standalone agenda -1 (Sl.No. 3/3A) -[Agenda 4 (Part II) (g) : Vol III (addendum):pages 71 to 74]






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Agenda No. Issue/Proposal Status after officers’
meeting
4(a) (Annexure-I )
S.No. 1
Vol-I: Page No. 216
 GST rate on uncooked/unfried extruded
snack pellets, by whatever name called,
may be reduced to 5%
 The issue for the past periods may be
regularized on as is basis.
No objection
4(a) (Annexure-I )
S.No. 2
Vol-I: Page No. 216-217
 GST rate on fish soluble paste (CTH 2309)
may be reduced from 18 % to 5%.
 The issue for the past periods may be
regularized on as is basis.
No objection
Goods-Changes Recommended (14):



Agenda No. Issue/Proposal Status after officers’
meeting
4(a) (Annexure-I )
S.No. 3
Vol-I: Page No. 217
 IGST may be exempted on Dinutuximab (Quarziba)
cancer medicine when imported for personal use.
MoHFW has confirmed that Dinutuximab (Quarziba) is
not approved by the Central Drugs Standard Control
Organization (CDSCO) and hence is only imported
No objection
4(a) (Annexure-I )
S.No. 4
Vol-I: Page No. 217-218
 IGST may be exempted
I. on Medicines and Food for Special Medical Purposes
(FSMP) used in the treatment of rare diseases enlisted
under the National Policy for Rare Diseases, 2021
which are imported for personal use subject to existing
conditions and
II. FSMP when imported by Centres of Excellence for
Rare Disease or any person or institution on
recommendation of any of the listed Centres of
Excellence.
No objection





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Agenda No. Issue/Proposal Status after
officers’ meeting
4(a) (Annexure-I )
S. No. 5
Vol-I: Page No. 218-219
 On the recommendations of 47th GST Council meeting,
GST rate of 5% was fixed on all goods viz. trauma, Spine
and Arthroplasty implants falling under heading 9021
w.e.f. 18.07.2022.
 Earlier there were two entries @ 5% and @ 12% for
similar goods under 9021, which was causing confusion.
 To regularize the matter for the period prior to
18.07.2022 on “as is basis” in view of genuine
interpretational issues, that is , in case of payments at 5%
or 12%.
No objection
4(a) (Annexure-I )
S.No. 6
Vol-I: Page No. 219-220
 May be clarified that supply of raw cotton, including kala
cotton, from agriculturists to cooperatives is a taxable
supply and such supply to the cooperatives (being a
registered person) attracts 5% GST under reverse charge
mechanism.
 The issue for the past periods may be regularized on as
is basis.
No objection



Agenda No. Issue/Proposal Status after officers’ meeting
4(a) (Annexure-I )
S.No. 7
Vol-I: Page No. 220-221
 New Foreign Trade Policy came
into force w.e.f. 01.04.2023.
 Consequential changes may be
carried out in the notifications.
No objection
4(a) (Annexure-I )
S.No. 8
Vol-I: Page No. 221-222
 GST on imitation zari thread or
yarn known by any name in
trade parlance may be reduced
from 12% to 5%.
 The issue for the past periods
may be regularized on as is
basis.
No objection
4(a) (Annexure-I )
S.No. 9
Vol-I: Page No. 222-223
 GST rate may be reduced on LD
slag from 18% to 5%.
 Both Odisha & Punjab drew attention to 48th GSTC
wherein the same request was not recommended on
the ground that it can be used in cement industry and
ITC can be taken. It was explained that LD slag is
not preferred by cement industry due to excess lime
content.
……contd.




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Agenda No. Issue/Proposal Status after officers’ meeting
4(a) (Annexure-I )
S.No. 9
Vol-I: Page No. 222-223
 GST rate may be reduced on LD slag
from 18% to 5%.
 Karnataka pointed out that other by-products of
steel namely, BF Slag & Fly Ash are already at
5%.
 Odisha was asked whether a study has been
conducted.
 Maharashtra pointed out that if offtake is not
there, taxing at 18% has no meaning.
4(a) (Annexure-I )
S. No. 10
Vol-I: Page No. 223
 IGST exemption is available on
imports of gold, silver or platinum by
specified banks and other entities
mentioned in List 34 of S. No. 359A
of Notification No. 50/2017 –
Customs dated 30.06.2017.
 List no. 34 may be updated as per
revised Appendix 4B of FTP 2023
subject to confirmation from DGEP
and DGFT.
No objection


Agenda No. Issue/Proposal Status after officers’
meeting
4(a) (Annexure-I )
S.No. 11
Vol-I: Page No. 223-224
 Compensation cess of 22% is applicable on Sports Utility
Vehicles (SUVs) (of length more than 4-metre, engine
capacity more than 1500cc and ground clearance 170
mm).
 FC recommended to include all utility vehicles by
whatever name called provided they met the parameters of
Length greater than 4000 mm, Engine capacity greater
than 1500 cc and Ground clearance more than 170 mm.
 FC also recommended to insert an Explanation to clarify
for the purposes of the said notification entry “Ground
Clearance” in entry 52B means Ground Clearance in un-
laden condition.
No Objection






Agenda for 52nd GSTCM Volume 1
Page 105 of 389
Agenda No. Issue/Proposal Status after officers’
meeting
4(a) (Annexure-I )
S.No. 12
Vol-I: Page No. 224-225
 In cases where RSP is not required to be declared by
law on pan masala and tobacco products, earlier ad-
valorem rate, applicable as on 31st March 2023 for such
goods, may be notified by amending the compensation
cess notification.
No objection
4(a) (Annexure-I )
S.No. 13
Vol-I: Page No. 225
 Issues related to dessicated coconuts for the period
1.7.2017 to 27.7.2017 may be regularized on as is basis.
No objection
4(a) (Annexure-I )
S.No. 14
Vol-I: Page No. 225
 Since areca leaf plates and cups are already exempt, no
action is required.
States had no objection but
Karnataka suggested to
regularise on as is basis for the
period before 01.10.2019


Agenda No. Issue/Proposal Status after officers’ meeting
4(b) (Annexure-
II)
S.No. 1
Vol-I: Page No. 226
 Ministry of Power has requested for reduction of rate
of GST on agro based biomass pellets to Nil as they
have mandate to use 5% of biomass co-firing in all
coal based Thermal Power Plants and to promote its
uptake.
 Fitment Committee recommended to maintain status
quo.
 While Gujarat has no objection to the
proposal, the state suggested to
regularise the issue on biomass
briquettes for the period 01.07.2017 to
12.10.2017 and on solid bio fuel
pellets from 01.07.2017 to 26.07.2018.
4(b) (Annexure-II )
S.No. 2
Vol-I: Page No. 227
 Request is for increasing GST rate on de-oiled rice
bran on the grounds that rice bran is sold to animal
feed producers directly from the un-organized market
or billed as de-oiled rice bran so as to avail nil GST
 The GoM on rate rationalisation in its interim report
did not recommend bringing all goods under chapter
23 (other than dog and cat food) to 5%.
 Fitment Committee recommended to maintain status
quo.
No objection
Goods-No change recommended (17) :






Agenda for 52nd GSTCM Volume 1
Page 106 of 389
Agenda No. Issue/Proposal Status after officers’
meeting
4 (b) (Annexure-II)
S.No. 3
Vol-I: Page No. 227
 Request is to exempt products prepared or manufactured
by the inmates of Kerala Prison and Correctional Services
Department.
 End use based exemption is difficult to administer, prone
to leakages
 Will lead to inverted duty structure on many commodities.
 Fitment Committee recommended to maintain status quo.
No objection
4 (b) (Annexure-II )
S.No. 4
Vol-I: Page No. 228
 Request is for reduction in GST rate on bio-fertilizers and
organic inputs from 12% to 5%.
 Council did not recommend changes in rates in 31st, 39th,
45th and 47th meetings.
 Fitment Committee recommended to maintain status quo.
No objection


Agenda No. Issue/Proposal Status after officers’
meeting
4(b) (Annexure-II)
S.No. 5
Vol-I: Page No. 228-229
 Request is to reduce GST on Sungudi sarees from 5% to
nil.
 Exempting GST will break ITC chain and entail end use-
based exemption which are prone to misuse.
 Persons under the threshold exemption are exempt from
paying GST on their supplies.
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II )
S.No. 6
Vol-I: Page No. 229-230
 Request is from IAEA seeking upfront exemption from
IGST on imports of their equipment and doing away with
refund mechanism under Section 55 of CGST Act.
 Giving such exemption for a particular organization will
result in similar requests in future from other
organizations, which is not desirable and is prone to
misuse.
 Fitment Committee recommended to maintain status quo.
No objection






Agenda for 52nd GSTCM Volume 1
Page 107 of 389
Agenda No. Issue/Proposal Status after
officers’ meeting
4(b) (Annexure-II)
S.No. 7
Vol-I: Page No. 230
 Request is to reduce GST on Avgas from 18% to nil/1%.
 Avgas is not goods for common man purpose.
 Reducing GST rate is not likely to significantly reduce
training cost.
 ITC is available of GST paid on Avgas used for supplying
pilot training services
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II)
S.No. 8
Vol-I: Page No. 231
 Request is to reduce GST on machinery used in sericulture
industry and automatic reeling machinery from 18 % to
5%/Nil.
 End-use based exemption are prone to misuse
 Will deepen duty inversion as raw materials attract 18%
GST.
 Council in 47th meeting did not recommend change in rate
for Silk Reeling machineries.
 Fitment Committee recommended to maintain status quo.
No objection


Agenda No. Issue/Proposal Status after officers’
meeting
4(b) (Annexure-II)
S.No. 9
Vol-I: Page No. 231-232
 Request is for uniform GST rate of 5% on all sports
goods (presently @12 %) and fitness products (@18%).
 This will lead to inverted duty structure as most of the
inputs (steel, rubber etc) attract GST @ 18%.
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II)
S.No. 10
Vol-I: Page No. 232
 The present request is for introducing concessions under
GST based on the lines of those that existed in the
Central Excise regime for Mega Power Projects and that
existed presently in Customs.
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II)
S. No. 11
Vol-I: Page No. 233
 Request is to reduce GST rate on apple carton boxes
from 18 to 5 %.
 End-use based exemptions/concessional rates are
difficult to administer.
 Fitment Committee recommended to maintain status quo.
No objection






Agenda for 52nd GSTCM Volume 1
Page 108 of 389
Agenda No. Issue/Proposal Status after officers’
meeting
4(b) (Annexure-II)
S.No. 12&14
Vol-I:
Page No. 233-234, 235
 Present request is to reduce GST and compensation cess
on flexi fuel vehicles.
 Flexi-fuel vehicles not clearly distinguishable and
identifiable unlike EVs.
 No clear cut ‘definition’ of flexi fuel vehicle in the
Motor Vehicle Act or any allied Acts.
 May lead to mis-classification of vehicles as flexi fuel
vehicles for availing benefit of concessional GST rate.
 Fitment Committee recommended to maintain status
quo.
No objection
4(b) (Annexure-II)
S.No. 13
Vol-I: Page No. 234
 Request is to exempt GST on agricultural products and
on agriculture- based items to protect farmers.
 Farmers do not have to pay tax on supply of fresh fruits
and vegetables. Request is general in nature.
 Fitment Committee recommended to maintain status
quo.
No objection

Agenda No. Issue/Proposal Status after officers’
meeting
4(b) (Annexure-II)
S. No. 15
Vol-I: Page No. 235-236
 Request is to reduce GST on utensil made up of metals.
 Already an inverted duty structure as raw materials attract
18% GST. Cost may increase with ITC accumulation.
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II)
S.No. 16
Vol-I: Page No. 236
 Request is to reduce GST rate on heavy feedstock, Vacuum
Gas Oil (VGS)/reformates, etc from 18% to nil.
 Lack of clarity on intended use, capacity utilization
potential and benefits.
 Fitment Committee recommended to maintain status quo.
No objection
4(b) (Annexure-II)
S. No. 17
Vol-I: Page No. 236-237
 Request is to reduce rate on all bakery products
manufactured and sold by MSME to 5%.
 Providing source based exemption to MSME sector for
specific products will be difficult to monitor and will cause
distortion.
 Fitment Committee recommended to maintain status quo.
No objection







Agenda for 52nd GSTCM Volume 1
Page 109 of 389
Agenda No. Issue/Proposal Status after
officers’ meeting
4(c) (Annexure-III)
S.No. 1
Vol-I: Page No. 238-240
 On the issue of prescribing 5% GST rate on ‘millet-mix’
containing 90% millets, Fitment committee recommended
to defer the issue for in-depth study as classification and
tax treatment at par with cereal flours is likely to affect a
large number of similarly placed products/mixes such as
idle mix, dosa mix etc entailing significant revenue
implication.
No objection
4(c) (Annexure-III)
S. No. 2
Vol-I: Page No. 240
 On the issue whether khari and cream roll should get
covered under “rusk, toasted bread and similar toasted
products”, Fitment Committee recommended to defer the
issue for in-depth study regarding the nature of product and
process of preparation before making any suggestions.
No objection
Goods- Deferred Issue (4):


Agenda No. Issue/Proposal Status after officers’
meeting
4(c) (Annexure-III)
S. No. 3
Vol-I: Page No. 240-241
 Request is to clarify regarding the scope of the product
‘sugar-boiled confectionary’ in view of difficulty in
administering the levy on sugar boiled confectionery (at
12%) from sugar confectionary (at 18%).
 On the issue of prescribing a uniform rate, Fitment
Committee recommended to defer the issue for industry
consultation.
No objection






Agenda for 52nd GSTCM Volume 1
Page 110 of 389
Agenda No. Issue/Proposal Status after
officers’ meeting
4(c) (Annexure-III)
S. No. 4
Vol-I: Page No. 241-246
 GST Council in its 47th meeting referred the issue of levy of
GST on steel scrap on RCM basis to Fitment Committee.
 State of Karnataka:
 Such proposal may not be feasible as it breaks the ITC
chain, leads to cascading of taxes and breakage of audit
trail.
 Suggested measures such as introduction of trace and
track mechanism, better registration procedures,
registration of e-way bills if that commodity is registered
to be supplied, ITC only if invoice is registered etc.
 State of Punjab :
 Tax iron and scrap on RCM and exempt supply of scrap
in the hands of traders
 Make e-way bill mandatory for all transactions in scrap
irrespective of value.
 Fitment Committee recommended to defer the issue to create
a Committee of officers to study the issue holistically and to
come up with workable solutions.
No objection


Agenda No. Issue/Proposal Status after officers’
meeting
4(d) (Annexure-IV)
S.No. 1
Vol-I: Page No. 247
 Satellite launch services supplied by ISRO, Antrix
Corporation Ltd (ACL) and New Space India Ltd (NSIL) are
already exempt from GST
 GST on satellite launch services provided by private
organizations may be exempted to promote start ups.
No objection
4(d) (Annexure-IV)
S.No. 2
Vol-I: Page No. 247-248
 Anomaly may be rectified by inserting an Explanation that
item at sl. No. 3(ie) of the notification No. 11/2017-CTR
refers to sub-items of the item (iv),(v) and (vi) of the
notification as they existed in notification prior to their
omission vide notification No. 03/2022-CTR dated
13.07.2022.
No objection
Services- Change recommended (7) :






Agenda for 52nd GSTCM Volume 1
Page 111 of 389
Agenda No. Issue/Proposal Status after officers’
meeting
4(d) (Annexure-IV)
S.No. 3
Vol-I: Page No. 248
 Entry at clause (h) of explanation to the entry at Sl. No. 24
(i) of the notification No. 11/2017 CTR dated 28.06.2017
may be omitted as parallel entry at sl. No. 53A of the notf.
No. 12/2017 CTR dated 28.06.2017 has already been
omitted.
No objection
4(d) (Annexure-IV )
S.No. 4(a)
Vol-I: Page No. 248-250
 GTAs may not be required to file declaration for paying GST
under forward charge every year. If they have exercised this
option for a particular financial year, they shall be deemed to
have exercised it for the next and future financial years
unless they file a declaration that they want to revert to
reverse charge mechanism (RCM).
No objection
Services- Change recommended (7) :


Agenda No. Issue/Proposal Status after officers’
meeting
4(d) (Annexure-IV)
S.No. 4(b)
Vol-I: Page No. 250
 Last date of exercising the option by GTAs to pay GST under
forward charge may be 31st March of preceding Financial
Year instead of 15th March. 1st January of preceding
Financial Year may be the start date for exercise of option.
No objection
4(d) (Annexure-IV )
S.No. 5
Vol-I: Page No. 250-252
 The provisions which were introduced in the notification
Nos. 8/2017-ITR, 9/2017-ITR and 10/2017-ITR making the
importer liable to pay GST on ocean freight paid to foreign
shipping lines under RCM have lost relevance and thus may
be amended/deleted.
 The proposed amendments/deletions may be synchronized
with date of notification of Section 162 of Finance Act, 2023.
No objection
Services- Change recommended (7) :






Agenda for 52nd GSTCM Volume 1
Page 112 of 389
Agenda No. Issue/Proposal Status after
officers’ meeting
4 (d) (Annexure-IV)
S.No. 6
Vol-I: Page No. 252
 It may be clarified that services supplied by a director of a company to the
company in his private or personal capacity such as supplying services by
way of renting of immovable property to the company or body corporate are
not taxable under RCM.
 Only those services supplied by a director of company or body corporate,
which are supplied by him as or in the capacity of director of that company
or body corporate shall be taxable under RCM in the hands of the company
or body corporate under notification No. 13/2017-CTR (Sl. No. 6) dated
28.06.2017.
No objection
4(d) (Annexure-IV )
S.No. 7
Vol-I: Page No. 252-255
 It may be clarified that supply of food in cinema halls is taxable as
restaurant service as long as (a) they are supplied by way of or as part of a
service and (b) supplied independently of the cinema exhibition service.
 Where the sale of cinema ticket and supply of food and beverages are
clubbed together, and such bundled supply satisfies the test of composite
supply, the entire supply will attract GST at the rate applicable to service of
exhibition of cinema, the principal supply.
No objection
Services- Change recommended (7) :


Agenda No. Issue/Proposal Status after officers’
meeting
4 (e) (Annexure-V)
S.No. 1
Vol-I: Page No. 261
 Exempt IGST on purchase of aircraft and aircraft lease
payment
 The request to abolish GST of 5% on import/purchase of
aircrafts and lease payments on leased aircrafts and engines
was placed before the 45th GST Council. The Council did not
accede.
 Fitment Committee recommended to maintain status quo
No objection
4(e) (Annexure-V )
S.No. 2
Vol-I: Page No. 261-263
 Exempt GST on the services by the way of granting
affiliation to schools by Central Board of Secondary
Education (CBSE) for conduct of secondary stage
examinations in schools
 Request for granting exemption on services by the way of
affiliation services provided by universities/board or other
educational organizations to educational institution was
placed before the 47th GST Council. The Council did not
accept the request.
 Fitment Committee recommended to maintain status quo
No objection
Services-No change recommended (3) :






Agenda for 52nd GSTCM Volume 1
Page 113 of 389
Agenda No. Issue/Proposal Status after officers’
meeting
4(e) (Annexure-V)
S.No. 3
Vol-I: Page No. 263-264
 Exempt GST on digital news subscription
 Subscription of e-papers is cheaper than the
subscription of print newspaper.
 Further, e-papers are offered at discounted price
by various platforms from time to time, thus
bringing the price even lower.
 Lowering of GST on e-paper will adversely affect
the printed newspaper industry.
 Exemption would result in blockage of ITC and
increase of cost. This will also lead to inverted
duty structure.
 Fitment Committee recommended to maintain
status quo.
No objection
Services-No change recommended (3) :


Agenda No. Issue/Proposal Status after
officers’ meeting
4(f) (Annexure-VI)
S.No. 1
Vol-I: Page No. 265-267
 To clarify whether service by way of hostel accommodation,
service apartments/ hotels booked for longer period is a service
of renting of residential dwelling for use as residence and
exempted.
 Since the matter is sub-judice in the Hon’ble Supreme Court of
India, it may be deferred.
No objection
4 (f)(Annexure-VI)
S.No. 2
Vol-I: Page No. 267-268
 To exempt services provided by District Mineral Foundations
(DMFs).
 45th GST Council deferred the matter stating that the issue was
not clear. Further, the council directed to obtain details about
the nature of activities undertaken by DMF from Odisha.
 However, no reply in the matter has been received so far.
 The matter may be deferred till reply is received from State of
Odisha.
No objection
Services- Deferred Issue (6):






Agenda for 52nd GSTCM Volume 1
Page 114 of 389
Agenda No. Issue/Proposal Status after
officers’
meeting
4(f) (Annexure-VI)
S.No. 3
Vol-I: Page No. 268-269
 To clarify whether reimbursement of electricity charges received by
the Real estate companies, malls, airport operators etc. from their
lessees/occupants is exempt from GST
 Members were requested to share practices being followed in their
states with regard to levy of GST on such further supply of electricity
along with other details. The reply has not been received so far.
 The matter may be deferred till the receipt of information.
No objection
4(f) (Annexure-VI)
S.No. 4
Vol-I: Page No. 279-271
 To clarify whether ITC credit of other business verticals can be used
to discharge GST on outward liability in respect of restaurant service
given the restriction of input tax credit as specified in notification No.
11/2017-CT (Rate) dated 28.06.2017
 Data from GSTN is required to be obtained regarding how much tax
is being paid by suppliers of restaurant service in cash and credit
 Pending the information the matter may be deferred.
No objection
Services- Deferred Issue (6):



Agenda No. Issue/Proposal Status after officers’
meeting
4(f) (Annexure-VI)
S.No. 5
Vol-I: Page No. 271-272
 To clarify that job work activity for processing of “Barley” into
malt for alcoholic beverages industry attracts GST @ 5% and in
case it is held that GST @18% i.e., leviable, to regularize for past
on ‘as is basis’
 West Bengal raised some concerns in relation to the instant issue
and requested for time to present its views after due consultation.
 The matter may be deferred.
No objection
4(f) (Annexure-VI)
S.No. 6
Vol-I: Page No. 272-274
 To apply uniform 5% GST on Business Correspondent services
provided in both rural/urban areas.
 Data is required from Department of Financial Services regarding
services provided by BC/BF in urban areas.
 The matter may be deferred.
No objection
Services- Deferred Issue (6):
Agenda No. Issue/Proposal Status after officers’
meeting
Agenda 4 (Part II) (g)
Vol III (addendum):
pages 71 to 74
 Standalone agenda deferred from 47th Meeting: positive list of
services to be specified in Sl. No. 3/3A
-
Services :Standalone agenda (1)






Agenda for 52nd GSTCM Volume 1
Page 115 of 389
Recommendations of the Fitment Committee:
Goods


Agenda 4(a) (Annexure-I): Changes in GST rates/ issuing clarification (pages-215-225)
1. Kachri /Kachri Papad/Unfried snack pellets manufactured through
extrusion process : (page 216)
• On the recommendations of 48th GST Council, a clarification was issued that extruded products such as
“fryums” are classifiable under 19059030 attracting GST rate of 18%.
• Representation received:
 to reduce the rate of GST or exempt the products, and
 to regularize the issue for the past periods.
• Fitment Committee recommendations:-
 GST rate on uncooked/unfried extruded snack pellets, by whatever name called, may be
reduced to 5%
 The issue for the past periods may be regularized on as is basis.






Agenda for 52nd GSTCM Volume 1
Page 116 of 389
Agenda 4(a) (Annexure-I)
2. Fish soluble paste: (pages 216-217 )
• Retrospective GST exemption was given till 30.09.2019 to Fishmeal and unintended waste generated
during the production of fish meal (falling under heading 2301), except for fish oil, on the
recommendation of the 37th and 45th GST Council meetings respectively.
• Fish soluble paste is a by-product produced while producing fish meal and fish oil.
• Fishmeal attracts GST rate of 5% but fish soluble paste, generated as a waste by-product during the
process of manufacture of fish meal, attracts 18% GST rate.
• Representation received:
 to reduce the rate of GST to 5%
 to regularize the issue for the past periods.
• Fitment Committee recommendations:
 GST rate on fish soluble paste (CTH 2309) may be reduced from 18 % to 5%.
 The issue for the past periods may be regularized on as is basis.


Agenda 4(a) (Annexure-I)
3. Dinutuximab (Quarziba) medicine : (page 217)
• The estimated cost of the therapy course is around Rupees 63 lakhs and it has to be imported.
• Patients and their kin are finding it difficult to pay the IGST rate of 12% since the medicine is already very
expensive and the cost of medicine is met through crowdfunding.
• Some ad-hoc exemptions have already been provided on case-to-case basis
• Representation received:
 IGST exemption on import of the cancer medicine .
• Fitment Committee recommendations:
 IGST may be exempted on Dinutuximab (Quarziba) medicine when imported for personal use.






Agenda for 52nd GSTCM Volume 1
Page 117 of 389
Agenda 4(a) (Annexure-I)
4. Medicines and Food for Special Medical Purposes used in treatment of rare
diseases: (pages 217-218)
• As part of post Budget 2023-24, Basic Customs Duty (BCD) exemption has been given to drugs/medicines
and Food for Special Medical Purposes (FSMP) when imported for personal use for treatment of rare
diseases enlisted in the National Policy for Rare Disease subject to existing conditions (individual importer
has to produce a certificate from central or State Director Health Services or District Medical Officer/Civil
Surgeon of the district).
• The BCD exemption currently available for drugs used in treatment of rare diseases imported by Centres of
Excellence for Rare Diseases or any person or institution on recommendation of any of the listed Centre of
Excellence was also expanded to include FSMP.
• These exemptions have been given based on recommendations of Ministry of Health and Family Welfare.
• Fitment Committee recommendation:
 IGST may be exempted on medicines and Food for Special Medical Purposes used in the treatment of
rare diseases enlisted under the National Policy for Rare Diseases, 2021 which are imported for
personal use subject to existing conditions and FSMP when imported by Centres of Excellence for
Rare Diseases or any person or institution on recommendation of any of the listed Centres of
Excellence.


Agenda 4 (a) (Annexure-I)
5. Trauma, Spine and Arthroplasty implants: (page 218-219)
• Earlier there were two entries @ 5% and @ 12% for the goods falling under 9021. Duality of rate on similar
goods falling under the same CTH 9021 was causing confusion.
• Accordingly, on the recommendations of 47th GST Council meeting, GST rate of 5% was fixed on all goods
falling under heading 9021 in order to bring uniformity.
• Entry at S. No. 255 A of Schedule I of notification No. 01/2017-CT Rate was inserted wef 18.07.2022 to
implement the recommendation.
• Representation received:
 to issue a clarification for period prior to the 18.07.2022.
• Fitment Committee recommendation:
To regularize the matter for the period prior to 18.07.2022 on “as is basis” in view of genuine
interpretational issues






Agenda for 52nd GSTCM Volume 1
Page 118 of 389
Agenda 4(a) (Annexure-I)
6. Raw cotton: (pages 219-220)
• Supply of raw cotton by an agriculturist to any registered person is taxable under reverse charge mechanism.
• Section 2(84) (i) of the CGST Act, 2017 defines ‘person’ as including “a co-operative society registered under
any law relating to co-operative societies”. As per Section 7 (1) (aa) of the CGST Act “supply” includes “the
activities or transactions, by a person, other than an individual, to its members or constituents or vice-versa, for
cash, deferred payment or other valuable consideration.”
• Supply includes all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence,
rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance
of business.
• Representation received:
 to clarify that raw cotton supplied by agriculturists to cooperatives is not taxable under reverse charge
mechanism.
• Recommendations of Fitment Committee :
 May be clarified that supply of raw cotton, including kala cotton, from agriculturists to cooperatives is a
taxable supply and such supply to the cooperatives (being a registered person) attracts 5% GST under
reverse charge mechanism.
 The issue for the past periods may be regularized on as is basis.

Agenda 4 (a) (Annexure-I)
7. Consequential changes after introduction of new Foreign Trade Policy 2023:
(pages 220-221 )
• New Foreign Trade Policy came into force w.e.f. 01.04.2023.
• Several schemes including Advance Authorisation (AA), Export Promotion of Capital Goods (EPCG),
Duty Free Import Authorisation (DFIA), Duty Drawback Scheme (DBK), Rebate on State and Central
Taxes and Levies (RoSCTL), Remission of Duties and Taxes on Exported Products (RoDTEP) are also
continued in the new FTP.
• Consequential changes will need to be carried out in notifications, which would be technical in nature such
as cross-referencing to new Trade policy
• Reference received :
Notifications to be aligned with FTP 2023
• Fitment Committee recommendation:
 Consequential changes may be carried out in the notifications.






Agenda for 52nd GSTCM Volume 1
Page 119 of 389
Agenda 4(a) (Annexure-I)
8. Imitation zari thread: (pages 221-222)
• In 15th Council meeting, the Council agreed to tax embroidery or zari articles i.e., imi, zari, kasab,
saima, dabka, chumki, gota, sitara, naqsi, kora, glass beads, badla, gizai at the rate of 5%. Only
embroidery articles, embroidery in piece, in strips or in motifs (heading 5809, 5810) got covered.
• In 28th GST Council meeting, the Council recommended to clarify that real zari kasab (thread)
manufactured with silver wire gimped (vitai) on core yarn namely pure silk and cotton and finally
gilted with gold would attract 5% GST.
• Input yarn, including kasab (thread), attracts 12% GST rate but embroidery articles attract 5% GST.
• Representation received:
 to clarify the that imitation zari thread attracts 5% as imitation zari thread such as kasab, dabka
are mentioned in the 5% entry.
• Fitment Committee recommendations:
 GST on imitation zari thread or yarn known by any name in trade parlance may be reduced
from 12% to 5%.
 The issue for the past periods may be regularized on as is basis.


Agenda 4(a) (Annexure-I)
9. LD slag: (pages 222-223)
• LD Slag is a recyclable waste produced during the separation of molten steel slag from impurities in steel-
making furnaces (200kg LD slag generated per ton of crude steel).
• Only 25% of the total slag generated in India is being reused/recycled. It is used for road project, sintering
and iron-making.
• It is posing an environmental problem as it is getting accumulated over the years and less land is available
for disposal of such huge quantities.
• The Council in the 23rd meeting recommended reduction of GST rate on BF Slag/Fly Ash to 5% based on
the reason that it is an environmentally harmful product and its re-usage needs to be promoted.
• There is a need for better utilization of this waste and protection of environment.
• Representation received:
 to reduce GST rate from 18% to 5% to encourage utilization
• Fitment Committee recommendation:
GST rate may be reduced on LD slag from 18% to 5%






Agenda for 52nd GSTCM Volume 1
Page 120 of 389
Agenda 4(a) (Annexure-I)
10. Updating list of banks/entities in notification 50/2017-Cus, eligible for IGST exemption
on import of gold, silver or platinum as per annexure 4B of HBP FTP 2023 : (page 223)
• IGST exemption is available on imports of gold, silver or platinum by specified banks and other entities
mentioned in List 34 of S. No. 359A of Notification No. 50/2017 – Customs dated 30.06.2017.
• In the 37th GST Council Meeting, dated 20.09.2019, the Council did not recommend inclusion of ICBC and
RBL Bank Ltd in the said List 34 as ‘Export Committee’ had not recommended their inclusion in the said list.
• Now, Directorate General Export Promotion has conveyed that inclusion of PSU or Bank approved by RBI is
not required to be discussed in Export Committee and has recommended for amending the List 34 suitably to
include the name of RBL and to also delete the name of Banks/entities which no longer exists in Appendix 4B
of HBP.
• RBL Bank and ICBC are authorized Banks mentioned in Para 4.40 of FTP 2023 (read with Appendix- 4B).
• Recommendation of Fitment Committee :
List 34 in notification 50/2017-Customs may be updated so as to include RBL bank and ICBC bank and
list no. 34 may be updated as per revised Appendix 4B of FTP 2023 subject to confirmation from DGEP
and DGFT.



Agenda 4(a) (Annexure-I)
11. Compensation cess on utility vehicles (MUV/XUV): (pages 223-224)
• Based on recommendation of the GST Council in its 21st Meeting held in Sept, 2017 a higher rate of
compensation cess of 22% was notified on “Sports Utility Vehicles (SUVs) (of length more than 4-metre,
engine capacity more than 1500cc and ground clearance 170 mm)”
• During the discussion in the 48th meeting of GST council held in December,2022 on agenda items relating to
issuance of clarification on compensation cess leviable on SUVs, upon suggestion by few of the members to
deliberate about compensation cess on other utility vehicles such as MUV, the Council directed the Fitment
Committee to examine the same .
• It is seen that there were other utility vehicles also that satisfy the conditions of Length greater than 4000
mm, Engine capacity greater than 1500 cc and Ground clearance more than 170 mm, but are popularly NOT
called as SUV but called as Multi Utility Vehicles (MUV) or multipurpose Vehicles or Crossover Utility
Vehicles (XUVs) .
• Fitment Committee recommendations:
 To amend the entry to include all utility vehicles by whatever name called provided they met the parameters of
Length greater than 4000 mm, Engine capacity greater than 1500 cc and Ground clearance more than 170 mm.
 to insert an Explanation to clarify for the purposes of the said notification entry “Ground Clearance” in entry 52B
means Ground Clearance in un-laden condition.





Agenda for 52nd GSTCM Volume 1
Page 121 of 389
Agenda 4(a) (Annexure-I)
12. Compensation cess on pan masala, chewing tobacco etc: (pages 224-225)
• To implement the recommendations made by 49th GST Council, which accepted the GoM report, the
levy of compensation cess was converted from ad valorem tax to specific tax-based levy to boost the
first stage (manufacturer level) collection of revenue in respect of pan masala, chewing tobacco, etc.
• The rates are linked to retail sale price for such products.
• Representation received:
 to determine rate of compensation cess in cases where it is not legally required to declare retail
sale price
• Fitment Committee recommendation:
 Earlier ad valorem rate as was applicable on 31st March 2023 for such goods may be notified by
amending the compensation cess notification.


Agenda 4(a) (Annexure-I)
13. Dessicated coconut: (page 225)
• Entry 47 of Notification 2/2017-Central Tax (Rate) exempted coconuts fresh or dried, whether or not
shelled or peeled.
• Vide corrigendum issued on 27-07-2017 to notification 01/2017-CT(R) dated 28.06.2017, dessicated
coconut was declared as a taxable product at 12% GST.
• Between the period 1.7.2017 to 27.7.2017 since there was no specific entry for dessicated coconut,
suppliers may not have collected GST from consumers.
• Representation received:
 to regularize the intervening period between issue of original notification & issue of
corrigendum prescribing 12% GST rate.
• Fitment Committee recommendation:
 The issue for the period 1.7.2017 to 27.7.2017 may be regularized on as is basis.






Agenda for 52nd GSTCM Volume 1
Page 122 of 389
Agenda 4(a) (Annexure-I)
14. Areca leaf plates and cups: (page 225)
• Currently, plates and cups made up of all kinds of leaves/ flowers/bark are already exempt vide Sl No.
114C of notification 2/2017-Central Tax (Rate) dated 28.6.2017.
• In the 37th GST Council meeting held on 20.9.2019, GST Council had recommended the reduction in
rate of cups and plates made of leaves of areca tree from 5% to nil.
• Representation received:
 to exempt areca leaf plates and cups
• Fitment Committee recommendation:
 Since areca leaf plates and cups are already exempt, no action is required.


Agenda 4(b) (Annexure-II): Recommendations for no change (pages 226-237)
1. Agro-based biomass pellets : (pages 226-227)
• 5% GST rate has been prescribed on the basis of recommendation of:
22nd GST Council Meeting (for Biomass briquettes) in October 2017 &
 28th GST Council Meeting (for solid bio fuel pellets) in July 2018.
• Ministry of Power has made the requested on the ground that they have mandated to use 5% of biomass co-
firing in all coal based Thermal Power Plants under Mission SAMARTH and to promote its uptake.
• Issue of GST rate reduction on solid biofuel pellets / biomass briquettes or pellets was discussed in 37th and
47th meetings but was not recommended
• Representation received:
To reduce GST on agro-based biomass pellets to Nil
• Fitment Committee Recommendation:
 Status quo may be maintained.






Agenda for 52nd GSTCM Volume 1
Page 123 of 389
Agenda 4(b) (Annexure-II)
2. De-Oiled Rice Bran: (page 227)
• Prior to the 25th Council Meeting, rice bran (HS 2302) for use as feed attracted nil GST and 5% for other
uses.
• The GST Council in its 25th meeting prescribed 5% GST on rice bran, irrespective of end use, and nil GST
on de-oiled rice bran.
• Present request is has been justified on the grounds that rice bran is sold to animal feed producers directly
from the un-organized market or billed as de-oiled rice bran so as to avail nil GST
• GoM on rate rationalisation in its interim report did not recommend bringing all goods under chapter 23
(other than dog and cat food) to 5%
• Representation received:
To increase GST rate on De-oiled Rice Bran
• Fitment Committee Recommendation:
 Status quo may be maintained.


Agenda 4(b) (Annexure-II)
3. Products prepared or manufactured by the inmates of Kerala Prison and correctional
Services Department : (page 227)
• Request is to exempt products prepared or manufactured by the inmates of Kerala Prison and correctional
Services Department.
• End use based exemption is difficult to administer, is prone to leakages and needs to be discouraged.
• It would lead to inverted duty structure on many of these commodities and disrupt the ITC chain.
• Fitment Committee Recommendation:
 Status quo may be maintained.






Agenda for 52nd GSTCM Volume 1
Page 124 of 389
Agenda 4(b) (Annexure-II)
4. Bio-fertilizers and other such organic inputs: (page 228)
• Based on 25th GST Council meeting recommendations, GST rate on 12 specified bio-pesticides was
reduced from 18% to 12 %.
• In its 31st meeting, the Council did not recommend reduction in GST on agricultural inputs including
pesticides, fertilizers and plant growth regulators to avoid a distortion of the ITC chain and inversion of
duty structure which would put domestic manufacturers at a disadvantage.
• In its 39th meeting, the Council did not recommend any change in rate on fertilisers.
• In its 45th and 47th meetings, the Council did not recommend any change in the rates of fertilizers or other
organic farm inputs.
Representation received:
 Present request is for reduction in GST rate on bio-fertilizers and organic inputs from 12% to 5%.
• Fitment Committee Recommendation:
 Status quo may be maintained.


Agenda 4(b) (Annexure-II)
5. Sungudi saree: (pages 228-229)
• In the manufacture of Sungudi Sarees, about 10,000 families of minority Sourastra Community are
engaged.
• However, sarees already attract concessional 5% GST and not 12% as mentioned in the representation
• Exempting GST will break ITC chain and will entail end use-based exemption which are prone to misuse.
• Under the threshold exemption, any person having turnover of less than Rs 40 lacs a year in goods, is
exempt from paying GST on their supplies.
• Representation received:
 to reduce GST from 12% to Nil on sungudi saree.
• Fitment Committee Recommendation:
 Status quo may be maintained.






Agenda for 52nd GSTCM Volume 1
Page 125 of 389
Agenda 4(b) (Annexure-II)
6. Upfront exemption for IAEA from payment of IGST and refund mechanism
be done away with: (pages 229-230)
• IAEA gets refund of GST paid under Section 55 of the CGST Act which provides for the refund of GST
paid by specialised agency of the United Nations Organisation or any Multilateral Financial Institution and
Organisation notified under the United Nations (Privileges and Immunities) Act, 1947, consulate or
embassy of foreign countries and any other person or class of persons as may be specified by notification.
• Notification No. 13/2017-IGST (rate) issued to give effect to section 55 of the CGST Act.
• Giving such exemption for a particular organization, for which refund mechanism is already in place will
result in similar requests in the future from other organizations, which is not desirable and is prone to
misuse.
Representation received:
Upfront exemption from IGST on imports of their equipment instead of refund mechanism.
• Fitment Committee Recommendation:
 Status quo may be maintained.



Agenda 4(b) (Annexure-II)
7. Avgas: (page 230)
• Avgas is a type of aviation fuel used in small piston engine powered aircraft within the general aviation
community. These aircraft are predominantly used by private pilots and flying clubs and for tasks such as
flight training.
• Pilot training course in India cost about Rs. 35-40 lacs from a DGCA-approved reputed flight school which
is majorly undertaken by upper-middle class strata of the society. Avgas is, therefore, not goods for
common man purpose.
• Avgas is only a component of flying training cost and other major costs includes aircrafts costs, insurance,
maintenance, instructors salaries etc.
• Reducing GST rate on Avgas is not likely to lead to significant reduction in training cost.
• ITC is available for GST paid on Avgas used for supplying pilot training services.
Representation received:
Request is for reduction of GST rate from 18% to nil/ 1%.
• Fitment Committee Recommendation:
 Status quo may be maintained.





Agenda for 52nd GSTCM Volume 1
Page 126 of 389
Agenda 4(b) (Annexure-II)
8. Machinery used in Sericulture Industry: (page 231)
• Such reduction/exemption on machineries will lead to an end-use based exemption which are
prone to misuse.
• Raw materials for these machineries such as iron steel, plastic, and other metals, in general,
attract 18% GST. Reduction in GST to 5% will deepen the duty inversion.
• Similar issue related to Silk Reeling machineries (8445 40 40) was deliberated in 47th GST
Council Meeting and no change was recommended.
• Representation received:
Request is to reduce GST on machinery used in sericulture industry and automatic reeling
machinery from 18 % to 5/Nil.
• Fitment Committee Recommendation:
 Status quo to be maintained.


Agenda 4(b) (Annexure-II)
9. Sports goods & Fitness equipment: (page 231-232)
• GST Council in its 14th Meeting held on 18.05.2017 recommended GST rate @ 12% for sports goods classified
under CTH 9506 (other than articles and equipment for general physical exercise) (Sl. No. 230 of schedule II of
notification 01/2017-Integrated Tax (Rate).
• Earlier, Articles and equipment of general physical exercise, gymnastics etc attracted GST @ 28%. GST Council in
its 23rd Meeting recommended GST @ 18% (Sl. No. 441 of Schedule III of notification No. 01/2017-Integrated
Tax (Rate) for articles and equipment of general physical exercise, gymnastics, athletics, padding pool etc etc.
• This would lead to an inverted duty structure as most of the inputs for sports goods like steel, rubber etc attract GST
@ 18%.
• Representation received:
The present request has asked for a uniform GST rate of 5% on articles under CTH 9506.
• Fitment Committee Recommendation:
 Status quo to be maintained.






Agenda for 52nd GSTCM Volume 1
Page 127 of 389
Agenda 4(b) (Annexure-II)
10. Mega power projects: (page 232)
• Before inception of GST, Customs and Central Excise Duty exemption benefit was available to mega power projects
• Initially, this exemption was available only to the power projects certified as Mega Power Project by the MoP. Subsequently,
with respect to provisional Mega Power Projects (which were yet to be issued a final Mega Power Project certificate),
exemption from payment of customs and central excise duties were provided subject to submission of security (BG/FDR). This
time limit for submission of final certificate was 36 months initially and subsequently increased first to 60 months in February,
2014 and then to 120 months in May, 2017 (before inception of GST) by amending this time-limit in both Customs and
Central Excise notification, failing which duty involved was required to be paid along with interest.
• On the eve of inception of GST, the notification No. 12/2012-CE ( S.N. 339) providing Central excise duty benefit to such
projects, was superseded by notification No. 11/2017-CE dated 30.06.2017. The superseding notification did not have any
reference to the exemption for Central Excise. Under GST, no exemptions have been provided.
• Representation Received:
 Introduce concessions under GST based on the lines of those that existed in the Central Excise regime and that existed
presently in Customs.
• Fitment Committee Recommendations:
 Status quo to be maintained.


Agenda 4(b) (Annexure-II)
11. Apple Carton Boxes: (page 233)
• Carton Boxes fall under HSN heading 4819.
• The matter in respect to the GST rates on the items falling under HSN 4819 was placed before the GST Council in its 45th meeting,
wherein it was observed that the items falling under HSN 4819 like cartons, boxes and cases of non-corrugated paper or paper board
attracts a GST rate of 18% and cartons, boxes and cases of corrugated paper or paper board attract a concessional GST rate of 12%.
After due deliberations, it was recommended that all items falling under HSN 4819, irrespective of being corrugated or non-
corrugated, shall attract a uniform GST rate of 18%. This change was made effective from 1st October, 2021.
• In 49th GST Council it was decided that Himachal Pradesh will submit a detailed representation in this regard for examination by the
Fitment Committee. Representation from CCT Himachal Pradesh was presented before the Fitment Committee.
• Generally, end-use based exemptions/concessional rates are difficult to administer and are generally litigation-prone.
• Representation Received:
 to reduce GST rate on apple carton boxes from 18 to 5 %.
• Fitment Committee Recommendation:
 Status quo to be maintained.






Agenda for 52nd GSTCM Volume 1
Page 128 of 389
Agenda 4(b) (Annexure-II)
12 & 14. Two-wheeler and 4-wheeler Flexi Fuel Vehicles (FFV): (pages 233-234 & 235)
• Flexi fuel vehicles (FFVs) have an internal combustion engine and are capable of operating on normal petrol and/or any blend of
petrol and ethanol.
• It has been a clear and consistent policy of decarbonizing the transport sector through various policies and initiatives that support
Electric Vehicles (EV), which is evident in the lowest tax rate of 5% GST on EVs in addition to PLI Scheme for Auto Sector &
Advance Chemistry Cell (ACC)
• However, unlike the EV vehicles which is clearly distinguishable and identifiable, this is not the case with flexi fuel vehicle
There is no clear cut ‘definition’ of flexi fuel vehicle in the Motor Vehicle Act or any allied Acts.
• This is likely to lead to mis-classification of vehicles as flexi fuel vehicles for availing benefit of concessional GST rate.
• Representation Received:
 to reduce GST and compensation cess, has given the slightly higher cost of flexi fuel engines as a rationale for GST/cess
reduction.
• Fitment Committee Recommendation:
 Status quo to be maintained.


Agenda 4(b) (Annexure-II)
13. Agricultural products: (page 234)
• Farmers do not have to pay tax on supply of fresh fruits and vegetables.
• The request is general in nature.
• Representation received
 to exempt GST on agricultural products and on agriculture- based items to protect the farmers.
• Fitment Committee Recommendation:
 Status quo may be maintained.






Agenda for 52nd GSTCM Volume 1
Page 129 of 389
Agenda 4(b) (Annexure-II)
15. Utensils made up of brass , bronze and other metals: (page 235-236)
• GST rate on raw materials for these utensils such as copper, zinc, tin, iron, steel, other metals and their scrap
in general, attract 18% GST.
• As a result, there is already inverted duty structure for supply of these utensils. Further reduction in GST rate
on utensils will deepen this tax inversion and consequently may lead to accumulation of input tax credit
thereby increasing cost of utensils.
• Representation received:
 to reduce GST on utensil of made up of metals.
• Fitment Committee Recommendation:
No change recommended.


Agenda 4(b) (Annexure-II)
16. Heavy feedstock, Vacuum Gas Oil / Reformates, etc: (page 236)
• This issue was deferred in last Fitment Committee meetings held in June & September, 2022 as inputs were
awaited from Ministry of Petroleum and Natural Gas (MoPNG).
• Fitment Committee had noted that further clarity was needed on the matter regarding the intended use,
capacity utilization potential and benefits accruing from heavy feedstock.
• The inputs received from MoPNG do not justify a reason for reduction in rate.
• Representation received
 to reduce GST rate on heavy feedstock, Vacuum Gas Oil / reformates, etc from 18% to nil.
• Fitment Committee Recommendation:
 Status quo may be maintained.






Agenda for 52nd GSTCM Volume 1
Page 130 of 389
Agenda 4(b) (Annexure-II)
17. All bakery products manufactured and sold by MSME: (pages 236-237)
• Rusks, toasted bread and similar toasted products attract GST rate of 5%.
• Bakery products like Pastry, cakes, biscuits and other bakers’ wares, whether or not containing cocoa;
communion wafers, empty cachets of a kind suitable for pharmaceutical use, sealing wafers, rice paper and
similar products [other than pizza bread, khakhra, plain chapatti or roti, bread, rusks, toasted bread and similar
toasted products] attract GST rate of 18%.
• Small manufacturers/traders in MSME sector have the option to avail threshold exemption and composition
scheme.
• Pre-GST incidence on most bakery products on which rate reduction is sought was 18% or more.
• Providing source based exemption to MSME sector for specific products like bakery products will be difficult to
monitor and will cause distortion.
• Representation received
 to reduce rate on all bakery products manufactured and sold by MSME to 5%.
• Fitment Committee Recommendation:
 Status quo may be maintained.


Agenda 4(c) (Annexure-III): Issue deferred for further examination (pages-238-246)
1. Millet-based products: (pages 238-240)
• Classification and tax treatment of millet mix at par with cereal flours is likely to affect the classification and
applicable tax rate on a large number of similarly placed products/mixes such as idle mix, dosa mix etc entailing
significant revenue implication.
• Representation received:
Request is to prescribe 5% GST rate on ‘millet-mix’ containing 90% millets.
• Fitment Committee Recommendations:
 Deferred for in-depth study






Agenda for 52nd GSTCM Volume 1
Page 131 of 389
Agenda 4(c) (Annexure-III)
2. Khari, Cream Rolls (Bakery products): (page 240)
• Currently, concessional GST rate of 5% is applicable on Rusks, toasted bread and other toasted products
• Bakery products such as Pastry, Cake, Biscuits, Communion Wafers, etc (other than pizza bread, khakhra, plain
chapatti or roti, bread, rusks, toasted bread and similar toasted products) attract GST rate of 18%.
• The matter was deferred by the 47th GST Council for further examination
• Representation received:
 to clarify that khari and cream roll should get covered under “rusk, toasted bread and similar toasted
products”.
• Fitment Committee Recommendations:
 Deferred for in-depth study regarding the nature of product and process of preparation before making any
suggestions.


Agenda 4(c) (Annexure-III)
3. Sugar-boiled confectionary: (pages 240-241)
• Currently, sugar- boiled confectionary attracts GST at the rate of 12% and Sugar confectionary attract GST at
the rate of 18%.
• Sugar boiled confectionary has been carved out with a lower GST rate of 12% based on recommendations of
the GST Council in its 25th meeting.
• In view of difficulty in administering the levy on sugar boiled confectionery (at 12%) from other similarly
placed commodities (at 18%) it is advisable to have uniform rate of 18% to remove the potential
leakages/misuse and avoidable litigation.
• Representation received:
 to clarify regarding the scope of the product ‘sugar-boiled confectionary’.
• Fitment Committee Recommendations:
 Deferred for industry consultation






Agenda for 52nd GSTCM Volume 1
Page 132 of 389
Agenda 4(c) (Annexure-III)
4. Steel Scrap: (page 241-246)
• Request to reduce GST rate from 18 % has not been accepted by GST Council in its 47th meeting. The only
issue referred to Fitment committee for deliberations is regarding levy of GST on RCM basis.
• During deliberations in 47th meeting, member from Karnatak suggested for detailed study and member from
Punjab suggested for deferment for want of detailed consultation.
• After consultation with stakeholders and industry, State of Karnataka suggested, inter alia that :
 the proposal of levy of GST on reverse charge mechanism may not be feasible as the same breaks the
chain of input tax credit and also leads to cascading of taxes and also breakage of audit trail.
 to prevent the evasion and to create conduce business atmosphere, few measures were recommended such
as: introduction of trace and track mechanism, better registration procedures, registration of e-way bills if
that commodity is registered to be supplied, ITC only if invoice is registered etc.
• Punjab has inter alia, suggested:
 to tax iron and scrap on RCM and exempt supply of scrap in the hands of traders
 e-way bill should be mandatory for all transactions in scrap irrespective of value.
• Fitment Committee Recommendations:
 Deferred: to create a Committee of officers to study the issue holistically and to come up with workable
solutions.


Recommendations of the Fitment Committee:
Services






Agenda for 52nd GSTCM Volume 1
Page 133 of 389
Agenda 4 (d) (Annexure-IV): Changes in GST rates/ issue clarification (page-247-260)
1. Exempt GST on satellite launch services provided by private organizations (pages 247-247)
• Satellite launch services supplied by ISRO, Antrix Corporation Ltd (ACL) and New Space India Ltd
(NSIL) are exempt from GST. However this exemption is not applicable to satellite launch services
provided by private organisations.
• The 42nd GST Council took a conscious decision to exempt satellite launch services even though GST
charged on such supplies was available to the recipient of these services as ITC. The rationale behind this
decision was to reduce the upfront cost for the recipients of such services especially startups.
• Recommendations of Fitment Committee
• The exemption may be extended to satellite launch services provided by private organizations with a view to
provide level playing field.


Agenda 4(d) (Annexure-IV)
2. Rectification in item at Sl. No. 3(ie) of notification No. 11/2017-CTR (pages 247-248)
• Sl. No. 3(ie) of notification No. 11/2017-CTR dated 28.06.2017 currently reads as “(ie) Construction of an
apartment in an ongoing project under any of the schemes specified in sub-item (b), sub-item (c), sub- item (d),
sub-item (da) and sub-item (db) of item (iv); sub-item (b), sub-item (c), sub-item (d) and sub-item (da) of item
(v); and sub- item (c) of item (vi), against serial number 3 of the Table, in respect of which the promoter has
exercised option to pay central tax on construction of apartments at the rates as specified for this item.”
• On the recommendations of 47th GST Council items at sl. No. 3(iv), (v) and (vi) of the above notification have
been omitted vide notification No. 03/2022-CTR dated 13.07.2022.
• However, the item at sl. No. 3(ie) of the notification continues to have reference to some of the housing schemes
etc. which figured under sl. No. 3(iv), (v) and (vi) of the notification in order to take care of the real estate
projects which commenced prior to 01.04.2019.
• Recommendations of Fitment Committee
• The anomaly may be rectified by inserting suitable explanation to effect that the item at sl. No. 3(ie) of the said
notification refers to sub-items of the item (iv),(v) and (vi) of the notification as they existed in notification prior
to their omission vide notification No. 03/2022-CTR dated 13.07.2022.





Agenda for 52nd GSTCM Volume 1
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Agenda 4(d) (Annexure-IV)
3. Omission of clause (h) of explanation to the entry at Sl. No. 24 (i) of the notification No.
11/2017 CTR (pages 248-248)
• On the recommendation of 47th GST Council, exemption entry at sl. No. 53A of the notf. No. 12/2017 CTR
dated 28.06.2017 which covered “services by way of fumigation in a warehouse of agricultural produce” was
omitted vide notification No. 04/2022-CTR dated 13.07. 2022.
• However, a parallel entry at clause (h) of explanation to the entry at Sl. No. 24 (i) of the notification No. 11/2017
CTR dated 28.06.2017 for the same service has not been omitted.
• Recommendations of Fitment Committee
• The anomaly may be rectified by omitting the parallel entry at clause (h) of explanation to the entry at Sl. No. 24
(i) of the notification No. 11/2017 CTR dated 28.06.2017


Agenda 4(d) (Annexure-IV)
4(a). Exercise of option by Goods Transport Agencies (GTAs) to pay GST under Forward Charge Mechanism
(FCM) (pages 248-250)
• GTAs who want to pay GST under FCM during any Financial Year are required to exercise the option to do
so by filing an online declaration on Goods and Services Tax Network (GSTN) portal by 15th March of the
preceding financial year.
• This requirement was notified on 13.07.2022 based on the recommendations of the 47th GST Council
meeting. Accordingly, the deadline for exercising this option for Financial Year 2023-2024 was 15th March,
2023.
• Representations were received that some of the GTAs could not file declaration by 15th March, 2023 for
various reasons including the presumption that the GTAs who had already opted for FCM are not required
to file option every year.
• Representations were also received that GTAs who commenced business after 15th March will not be able to
exercise option for the FY 2023-2034.






Agenda for 52nd GSTCM Volume 1
Page 135 of 389
Agenda 4(d) (Annexure-IV)
4(a). Exercise of option by Goods Transport Agencies (GTAs) to pay GST under Forward Charge Mechanism
(FCM) (contd…) (pages 248-250)
• The following two changes were made with the approval of GST Implementation Committee (GIC) to
resolved the issues in view of the urgency involved:
• The last date for exercising the option to pay GST under FCM was extended from 15th March, 2023 to
31st May, 2023 and
• GTAs who commence new business or cross registration threshold during any Financial Year, have
been allowed to exercise the option for the year in which they commence business or cross registration
threshold within 45 days from date of applying for GST registration or 1 month from date of obtaining
registration whichever is later.
• The above changes were notified w.e.f 09.05.2023 thereby resolving this issue for the current Financial
Year.
• For the future, it is felt that GTAs who have exercised option to pay GST under forward charge in previous
Financial Year(s) should not be required to file declaration every year.
• Recommendations of Fitment Committee
• As a trade friendly measure, the requirement to exercise option to pay GST under forward charge every year
may be done away with. GTAs who have exercised option to be under FCM during a particular Financial Year
shall be deemed to have exercised it for the next and future Financial Years unless they file a declaration that
they want to revert to reverse charge mechanism (RCM).



Agenda 4(d) (Annexure-IV)
4(b). Notifying 1st January of preceding Financial Year as start date and 31st March of preceding Financial
Year as end date for filing of option by Goods Transport Agencies (GTAs) to pay GST under forward charge
(pages 250-250)
• GSTN has requested that a start date for filing of option by GTA may be provided for subsequent Financial
Years; otherwise the default date for exercise of option for a Financial Year shall be 1st April of the
preceding Financial Year. For example, the default start date for Financial Year 2024-2025 would be 1st
April, 2023.
• Keeping start date for exercise of option for a FY as 1st April of the preceding Financial Year is not
desirable as this may give rise to false impression to the GTAs that they have exercised the option for the
current Financial Year .
• Recommendations of Fitment Committee
• The start date may be prescribed as 1st January of the preceding Financial Year.
• The last date for filing the option may be changed from 15th March to 31st March of preceding Financial Year.





Agenda for 52nd GSTCM Volume 1
Page 136 of 389
Agenda 4(d) (Annexure-IV)
5. Amendment to be made to notification No. 8/2017-ITR and notification No. 10/2017-ITR to remove
redundant provisions pursuant to amendments in Finance Act, 2023. (pages 250-252)
• The place of supply (PoS) for transportation of goods is ‘destination of goods’. As a result, transportation
service supplied by an Indian Shipping Line (ISL) to a foreign exporter, for transport of goods from foreign
port to India do not qualify to be an export of service and is thus, taxable. However, on the same service
supplied by a Foreign Shipping Line (FSL) to foreign exporter, both being outside India, FSLs do not pay
GST.
• To provide level playing field to ISLs, liability on such transportation service supplied by FSLs to foreign
exporter for transport of goods to India, was placed on the Indian importer under RCM.
• Hon’ble Supreme Court judgement in Mohit Mineral case passed in 2022 has set aside this RCM liability
placed on the importers.
• In order to restore level playing field to ISLs, the PoS of service of transportation of goods has been
changed from ‘destination of goods’ to ‘location of recipient’ vide Finance Act 2023. As a result, services
supplied by ISLs to foreign exporter against payment in foreign exchange would now meet the definition of
export of service and shall be zero rated. This is intended to bring parity between tax treatment of service
supplied by FSL and ISLs both for inward and outward freight. [For a service to qualify as export of service,
its PoS should be outside India].


Agenda 4(d) (Annexure-IV)
5. Amendment to be made to notification No. 8/2017-ITR and notification No. 10/2017-ITR to remove
redundant provisions pursuant to amendments in Finance Act, 2023 (contd…) (pages 250-252)
• Once the provisions of Finance Act, 2023 are notified, the provisions in notification Nos. 8/2017-ITR,
9/2017-ITR and 10/2017-ITR, making the importer liable to pay GST on ocean freight paid to FSLs under
RCM will become redundant.
• Recommendations of Fitment Committee
• The provisions which were introduced in the said notifications to provide level playing fields to ISLs have lost
relevance may be amended/deleted.
• The proposed amendments/deletions may be synchronized with date of notification of Section 162 of Finance
Act, 2023.






Agenda for 52nd GSTCM Volume 1
Page 137 of 389
Agenda 4(d) (Annexure-IV)
6. Clarify whether services provided by director in his personal/private capacity to company/body corporate
are subject to reverse charge mechanism (pages 252-252)
• Entry No. 6 of notification No. 13/2017 CTR dated 28.06.2017, provides that services supplied by a director
of a company or a body corporate to the said company or the body corporate are subject to Reverse Charge
Mechanism under the provisions of Section 9(3) of CGST Act.
• Issue has been raised whether services supplied by a director of a company in his personal capacity such as
renting of immovable property to the company or the body corporate is taxable under Reverse Charge
Mechanism.
• Recommendations of Fitment Committee
• It may be clarified by way of circular that services supplied by a director of a company to the company in his
private or personal capacity such as supplying services by way of renting of immovable property to the company
or body corporate are not taxable under RCM. Only those services supplied by a director of company or body
corporate, which are supplied by him as or in the capacity of director of that company or body corporate shall be
taxable under RCM in the hands of the company or body corporate under notification No. 13/2017-CTR (Sl. No.
6) dated 28.06.2017.


Agenda 4(d) (Annexure-IV)
7. Clarify that the food or beverages supplied at cinema hall is taxable as restaurant service(pages 252-255)
• As per Explanation at Para 4 (xxxii) to notification No. 11/2017-CTR dated 28.06.2017,“Restaurant Service’
means supply, by way of or as part of any service, of goods, being food or any other article for human consumption or
any drink, provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the
premises where such food or any other article for human consumption or drink is supplied.”
• Eating joint is a wide term which includes refreshment or eating stalls/ kiosks/ counters or restaurant at a
cinema also. The cinema operator may run these refreshment or eating stalls/ kiosks/ counters or restaurant
themselves or they may give it on contract to a third party. The customer may like to avail the services
supplied by these refreshment/snack counters or choose not to avail these services. Further, the cinema
operator can also install vending machines, or supply any other recreational service such as through coin-
operated machines etc. which a customer may avail or not.
• Recommendations of Fitment Committee
• It may be clarified by way of a circular that the food or beverages served in a cinema hall is taxable as restaurant
service as long as:
• the food or beverages are supplied by way of or as part of a service and
• supplied independent of the cinema exhibition service.
• Where the sale of cinema ticket and supply of eatables such as popcorn or cold drinks etc. are clubbed together,
and such bundled supply satisfies the test of composite supply, the entire supply will attract GST at the rate
applicable to service of exhibition of cinema, the principal supply.






Agenda for 52nd GSTCM Volume 1
Page 138 of 389
Agenda 4 (e)(Annexure-V): Recommendations for no change (page-261-264)
1. Exempt IGST on purchase of aircraft and aircraft lease payment (pages 261-261)
• The request to abolish GST of 5% on import/purchase of aircrafts and lease payments on leased aircrafts
and engines was placed before the 45th GST Council. The Council did not accede to this request.
• Exempting IGST on purchase/import of aircraft will be detrimental to the ‘Make in India’ initiative of the
government and the nascent aircraft manufacturing industry in India.
• GST on supply of goods on lease has to be the same as GST on supply of goods by way of sale to avoid
arbitrage.
• Recommendations of Fitment Committee
• Status Quo to be maintained


Agenda 4 (e) (Annexure-V)
2. Exempt GST on the services by the way of granting affiliation to schools by Central Board of Secondary
Education (CBSE) for conduct of secondary stage examinations in schools (pages261-263)
• Request for granting exemption on services by the way of affiliation services provided by universities/board
or other educational organizations to educational institution was placed before the 47th GST Council. The
Council did not accept the request.
• Earlier, based on the recommendations of the 43rd GST Council, it was clarified vide circular dated
17.06.2021 that such services attract GST at the rate of 18%.
• Recommendations of Fitment Committee
• Status Quo to be maintained






Agenda for 52nd GSTCM Volume 1
Page 139 of 389
Agenda 4 (e) (Annexure-V)
3. Exempt GST on digital news subscription (pages 263-264)
• Services by way of online/digital news subscription comes under the heading 9984 - Telecommunications,
broadcasting and information supply services which attract GST @ 18%. Supply of news in digital form is
essentially different from the printed news papers in its constitution, distribution and transmission
• Subscription charges for online news vis-à-vis print media have been examined. It is found that subscription
of e-papers is cheaper than the subscription of print newspaper.
• Further, e-papers are offered at discounted price by various platforms from time to time, thus bringing the
price even lower.
• Even after being taxed at 18%, subscription for online/digital newspaper is available at considerably lower
price. Therefore, the argument of trade that the 18% rate hinders the access of the consumers to the online
news has no merits. In fact, lowering of GST on e-paper will adversely affect the printed newspaper
industry.
• Further, in case of printed newspaper, major inputs i.e. newsprint attracts GST @5%, however, in case of e-
papers, major inputs are taxed at higher rates of GST (18/28% e.g. Telecommunications, broadcasting and
information supply services, Electronic goods (monitors, storage device etc.). As a result, exemption would
result in blockage of ITC and increase of cost. This will also lead to inverted duty structure.
• Recommendations of Fitment Committee
• Status quo to be maintained


Agenda 4 (f) (Annexure-VI): Issue deferred for further examination (page-265-274)
1. Clarify whether service by way of hostel accommodation, service apartments/ hotels booked for longer
period is a service of renting of residential dwelling for use as residence and exempted (pages 265-267)
• The services under heading 9963 by a hotel, inn, guest house, club or campsite by whatever name called for
residential or lodging purpose, having declared tariff of a unit below one thousand rupees per day or equivalent
were exempt till 17.07.2022 vide entry no. 14 of the notf. No. 12/2017-CT(R) dated 28.06.2017.
• Circular No. 354/17/2018-TRU dated 12.02.2018 has considered hostel accommodation at par with hotel
accommodation.
• As a result, the service of hostel accommodation prized below Rs. 1000/- a day is now taxable @ 12% w.e.f
18.07.2022 provided charges are Rs. 7500/- or less per day.
• However, in the case of Taghar Vasudeva Ambrish, the Hon’ble Karnataka High has held the service of hostel
accommodation as the services by renting of residential dwelling for use as residence.
• Entry no. 12 of notification No. 12/2017-CT (Rate) dated 28.06.2017 exempts the services by way of renting of
residential dwelling for use as residence.






Agenda for 52nd GSTCM Volume 1
Page 140 of 389
Agenda 4(f) (Annexure-VI)
1. Clarify whether service by way of hostel accommodation, service apartments/ hotels booked for longer
period is a service of renting of residential dwelling for use as residence and exempted (contd…)(pages 265-267)
• Therefore, if the hostel accommodation is considered as the hotel accommodation in line with the circular dated
12.02.2018, it is taxable and if it is considered as residential dwelling, as held by the Hon’ble Karnataka High
Court, it is exempt from GST.
• The department has filed civil appeal before the Hon’ble Supreme Court of India against the Hon’ble Karnataka
High judgement. The matter is sub-judice.
• Recommendations of Fitment Committee
• Since the matter is sub-judice, it may be deferred.


Agenda 4(f) (Annexure-VI)
2. Exempt services provided by District Mineral Foundations (DMFs) (pages 267-268)
• 45th GST Council (SI.No.7 of Annexure-VI, Agenda No. 14) deferred the matter stating that the issue was
not clear. Further, the council directed to obtain details about the nature of activities undertaken by DMF
from Odisha.
• Odisha government was requested to inform the nature of activities undertaken and services supplied by
DMF. However, no reply in the matter has been received so far.
• Recommendations of Fitment Committee
• The matter may be deferred till reply is received from State of Odisha.






Agenda for 52nd GSTCM Volume 1
Page 141 of 389
Agenda 4 (f) (Annexure-VI)
3. Clarify whether reimbursement of electricity charges received by the Real estate companies, malls,
airport operators etc. from their lessees/occupants is exempt from GST(pages 268-269)
• The issue was discussed in the Fitment Committee meetings held on 25.04.2023 and 09.06.2023
• Members were requested to share practices being followed in their states with regard to levy of GST on such
further supply of electricity by builders/developers etc., the regulatory framework w.r.t such further supply
of electricity, and copies of Show Cause Notices/Adjudication Orders issued, if any, demanding GST on
such further supply of electricity, along with their views. However, the same have not been received so far.
• Recommendations of Fitment Committee
• The matter may be deferred till the receipt of information.


Agenda 4(f) (Annexure-VI)
4. Clarify whether ITC credit of other business verticals can be used to discharge GST on outward
liability in respect of restaurant service given the restriction of input tax credit as specified in notification No.
11/2017-CT (Rate) dated 28.06.2017, as amended (pages 269-271)
• It was decided to obtain data from GSTN regarding how much tax is being paid by suppliers of restaurant
service in cash and credit for further examination of the issue.
• Recommendations of Fitment Committee
• The matter may be deferred.






Agenda for 52nd GSTCM Volume 1
Page 142 of 389
Agenda 4(f) (Annexure-VI)
5. Clarify that job work activity for processing of “Barley” into malt for alcoholic beverages industry
attracts GST @ 5% and in case it is held that GST @18% i.e., leviable, to regularize for past on ‘as is basis’ (pages
271-272)
• In the Fitment Committee meeting held on 29.05.2023 , West Bengal raised some concerns in relation to the
instant issue and requested for time to present its views after due consultation.
• Recommendations of Fitment Committee
• The matter may be deferred.


Agenda 4(f) (Annexure-VI)
6. Apply uniform GST rate of 5% on Business Correspondent services provided in both rural/urban areas.
(pages 272-274)
• It was felt that to further examine the issue, difficulties faced by banks in availing benefit of GST
exemptions with respect to business correspondents/business facilitators in rural area needs to be ascertained
more comprehensively.
• Further, some more data is required from Department of Financial Services regarding services provided by
BC/BF in urban areas.
• Recommendations of Fitment Committee
• The matter may be deferred.







Agenda for 52nd GSTCM Volume 1
Page 143 of 389
• A proposal to specify a positive list of 12 services under Sr. No. 3/3 A of notification 12/2017-CT(R) dated 28.06.2017
was placed before the 45th GST Council. The Council was of the view that while the approach to specify a positive list of
exempt services was agreeable, the list recommended by Fitment Committee needs to be pruned and refined.
 Entry at Sr. No. 3: exempt supply of pure services supplied to Central Government, State Government or Local Authority, by way of any
activity in relation to Municipal or Panchayat functions under Article 243G or 243W of the Constitution
 Entry 3A : exempt composite supplies (goods component 25% or less) supplied to Central Government, State Government or Local
Authority by way of activity in relation to Municipal or Panchayat functions under Article 243G or 243W of the Constitution
• There was a similar Service tax exemption. However, in view of disputes, the exemption was restricted to supply of
services by way of five specific activities, namely , water supply, public health, sanitation conservancy, solid waste
management or slum improvement and up-gradation
• As per the direction of the 45th GST Council, the list was circulated to States. Comments were received from West
Bengal, Bihar and Tamil Nadu. The issue was further discussed at length in the Fitment Committee.
• In 47th GST Council, Fitment recommended pruned list of 6 services.
• The recommendations of Fitment Committee was placed before 48th GST Council meeting held on 17.12.2022 held vide
video conference.
• Some states did not agree with the recommendation of the Fitment Committee. The Council decided to postpone
discussion on the positive list of services in a physical meeting of the GST Council.
Agenda 4(Part II) (g) :
Stand alone agenda: deferred from 47th GST Council meeting (Addendum to Vol. III, pages -71-74)
Recommendations of Fitment Committee on positive list of services to be specified in Sl. No. 3/3A of
notification No. 12/2017-CT (R) dated 28.06.2017
A. Entry 3 and 3A may be reworded to omit the words “ in relation to” as below:
Supply of pure services, or composite supply of goods and services, in which the value of goods constitutes not more
than 25% of the value of composite supply, to Central Government, State Government, Union Territory, a local
authority or a public authority by way of-----
B. Following list of 12 services may be specified under the entry:
1. Water treatment and/or supply;
2. Public Health activities, Sanitation Conservancy and Solid or Liquid Waste management;
3. Slum Improvement and Up gradation;
4. Maintenance and operation of street lights, bus stops, public conveniences, public parks and gardens,
burial ground and crematorium;
5. Education, including primary and secondary schools;
6. Technical training and vocational education
7. Adult and non-formal education;
8. Libraries;
9. Social Forestry and Farm Forestry;
10. Fire Services;
11. Renting of motor vehicles for carrying out functions listed at Sr. No. 1 to 10 above;
12. Supply of manpower services for carrying out functions listed at Sr. No 1 to 10 above.”







Agenda for 52nd GSTCM Volume 1
Page 144 of 389
C. Exemption may be extended to “Public Authority” and Public authority may be defined as under:
“Public Authority means an authority or a board or any other body established and controlled by the
Central or State Government to carry out the functions listed in SI. No. 1 to 10 of the entry.”



THANK YOU


Agenda for 52nd GSTCM Volume 1
Page 145 of 389
Annexure-5
FACT SHEET
50th GST Council Meeting
11th July, 2023
Casinos, Race Courses &​ Online Gaming
1




Legal Framework
• GST - levied on the supply of goods and services.
• Goods include actionable claims as per section 2(52) of the CGST Act,
2017.
• Actionable claim means a claim to any beneficial interest in movable
property not in the possession of the claimant where such beneficial
interest is existent, accruing, confidential or contingent.
• As per Entry 6 of Schedule III of the CGST Act, 2017, actionable
claims in the form of lottery, betting and gambling are taxable.
2



Agenda for 52nd GSTCM Volume 1
Page 146 of 389
Background
• Actionable claims in the form of lottery, betting and gambling attract 28%
GST (Entry 228 & 229, Schedule IV, Notf. No. 1/2017-CTR) on full face value
of bets placed (Rule 31A, CGST Rules 2017).
• Taxation of lottery is settled. (SC decision in Skill Lotto case) Rule 31A, CGST
Rules, 2017 was also upheld in the said case.
• Online gaming companies claiming their supply of services under SAC
998439 (other on-line content) which attracts 18%.
• Casinos and race clubs are classifying their supply under SAC 9996
(gambling & betting services) which attract 28%.
• No specific mention of casinos, race courses and online gaming in Entry 6,
Schedule III.
3


Casinos
• Currently, Casinos operational in Goa and Sikkim. Yet to be operational in Daman.
• Present Practice:
GST @28% is being paid on GGR in both Sikkim and Goa.
Pre GST (Goa) GST (Current)
Tax Rate Value Tax Rate Value
Entertainment tax
(entry ticket)
Rs 1000/-
( 2016-17)
Per person
GST 28%
100% of the
face value of
the bet
Entertainment tax
(gaming revenue) 15%
Sale of chips/coins or the receipts received
by the proprietor/ operator towards casino
games either on slot machine or table games
or any other games provided in the casino.
As per Goa that in practice tax was being paid
@ 15% on GGR*.
* GGR ( Gross Gaming Revenue ) means net value after deducting the
chips/coins returned by players
4






Agenda for 52nd GSTCM Volume 1
Page 147 of 389
Casinos -View of States
Sikkim & Goa
Tax Casinos @ 28% on GGR
5



Casinos – Tax Revenue
(in Rupees Crore)
GST Collected
Centre/State FY HSN Taxable Value [GGR] GST
Goa (Centre) 2017-18 999692 93.94 26.3
2018-19 999692 139.19 38.97
2019-20 999692 112.45 31.49
2020-21 999692 48.84 13.67
2021-22 999692 147.82 41.39
2022-23 (Nov) 999692 80.05 22.41
Total 622.28 174.24
Goa (State) 2017-18 999692 583.73 163.45
2018-19 999692 986.35 276.18
2019-20 999692 974.46 272.85
2020-21 999692 431.65 120.86
2021-22 999692 739.25 206.99
2022-23 (Nov) 999692 987.47 276.49
Total 4702.91 1316.81
Sikkim 2017-18 999692 22.90 6.19
2018-19 999692 43.58 11.58
2019-20 999692 36.46 9.52
2020-21 999692 19.21 5.16
2021-22 999692 41.52 11.14
2022-23 999692 56.78 14.15
Total 220.46 57.74
Grand Total 5545.66 1548.79
6





Agenda for 52nd GSTCM Volume 1
Page 148 of 389
Race Courses
• Horse Racing Clubs operate in 7 cities, - Mumbai, Hyderabad, Chennai, Kolkata,
Bengaluru, Mysore and New Delhi.
Pre GST GST [Current tax structure]
Tax Rate Value Tax Rate Value
Service Tax on tote
commission 15%
On 20% commission retained by the
race club from bets placed in the
totalizator.
GST 28%
100% of the face
value of the bet
or the amount
paid into the
totalisator
Service Tax on
allowing access to
race course
15% On the price of entry ticket.
Entertainment tax 29%
(weighted
average )
On the price of entry ticket
Betting/Totalisator
tax
8% - 21% in
different
states
On the full face value of the bets
placed
7



Race Courses -Present Practice
8
Race Club Rate Value
Royal Western India Turf Club 28% Full value of bet
Royal Calcutta Race Club 28% Full value of bet
Delhi Race Club 28% Full value of bet
Bangalore Turf Club
28% • July, 2017 – Jan, 2019 – on commission/margin
• Feb, 2019 – June, 2021 – on full value of bets
• June, 2021 – till date – on commission/margin
[Karnataka HC has ruled in favour of Bangalore Turf Club. Dept has filed appeal in SC]
Mysore Race Club
28% • July, 2017 – 22nd Jan, 2018 – on commission
• 23rd Jan, 2018 – 31st Jan, 2019 - on full value of bets (paid under protest and writ
is pending in HC)
• 1st Feb, 2019 – May, 2023 – on full value of bets
• 01st June, 2023 onwards – on commission
Hyderabad Turf Club
28% Commission/Margin
[Department has booked cases (Demanding GST @ 28% on the total face value of
the bets received by the Club). Case is pending before the HC of Telangana state.]
Madras Race Club 28% Commission/Margin




Agenda for 52nd GSTCM Volume 1
Page 149 of 389
Race Courses – Tax Revenue
(Value in Rupees Crore)
9
Horse Racing
Financial Year Taxable Value GST(Actual)
2017-18 477.04 133.39
2018-19 690.35 188.09
2019-20 882.82 245.32
2020-21 148.20 40.81
2021-22 219.59 59.57
2022-23 291.75 78.50
Total 2709.75 745.67


Race Courses
• Horse Racing may be taxed
@ 28%
on full value of the bets placed with
bookmakers/totalisator
10






Agenda for 52nd GSTCM Volume 1
Page 150 of 389
Online Gaming
Current GST tax structure
Tax Rate Value
GST 28% 100% of the face value of the bet
Present Practice:
• Online gaming companies are paying GST @18% on platform fees.
11


Online Gaming – Tax Revenue
[Value in Rupees Crore]
Financial
Year
Maharashtra Uttar
Pradesh
West
Bengal
Panchkula
Zone
Bangalore
Zone
Sikkim Total of GST
(6 States/Zones)
2017-18 33.84 107.50 0.00 0.00 3.77 1.96 147.07
2018-19 145.01 144.12 0.00 0.00 17.05 3.85 310.03
2019-20 631.60 155.15 0.00 49.64 100.22 4.22 940.83
2020-21 867.76 119.38 1.61 29.35 349.97 5.12 1373.19
2021-22 885.89 244.60 10.17 156.38 379.64 6.22 1682.90
2022-23
[till Nov]
959.40 166.24 7.72 169.30 - 10.87 1313.53
*Sample data from 6 States/Zones
12






Agenda for 52nd GSTCM Volume 1
Page 151 of 389
Demand Notices/Litigation
• Three SCNs issued by DGGI, CBIC wherein the revenue involved is Rs. 22583 Crore.
• States such as Kerala, Tamil Nadu, Telangana, Andhra Pradesh and Karnataka banned online gaming/gambling.
However, the same has been stayed by Court orders. Tamil Nadu has issued an ordinance.
13
Case High Court Issue Decision of High Court Appeals filed
Gurdeep Singh
Sachar Vs UOI & Ors
(CRLPIL No.
22/2019)
Bombay
High Court
1. Dream 11 –
game of skill or
chance?
2. GST on
Dream 11?
1. Dream 11 is a game of skill.
2. It is an actionable claim but not in the
form of betting and gambling.
Therefore, it is neither supply of goods nor
supply of services, thus clearly exempted
from levy of any GST.
1. Appeal filed by State of Maharashtra.
The High Court order has been stayed
vide Supreme Court vide order dated
06.03.2020.
2. Review petition filed by UOI before the
Bombay High Court is pending.
Varun Gumber Vs UT
of Chandigarh & Ors
(CWP No. 7559/
2017)
Punjab &
Haryana
High Court
Dream 11 –
game of skill or
chance?
Dream 11 is a game of skill.
[Case was in the context of police laws of
the state and UOI was not a party to the
case]
An appeal filed by Varun Gumber in the
Supreme Court was dismissed.
Gameskraft
Technologies (WP
19570/2022)
[SCN demanding Rs.
20,989 Crore]
Karnataka
High Court
GST on online
Rummy and
other games
GST Demand Notice has been set aside. SLP is being filed in Supreme Court on advise
of ASG.
Myteam 11 Fantasy
Sports Vs UOI & Ors
(DBCWP 1100/2023)
High Court
Of Rajasthan
at Jaipur
GST on online
Rummy, poker
& other games
No coercive action to be taken by GST
Authorities.
Final order (High Court) is pending.



Demand Notices/Litigation
14
Case High
Court
Issue Decision of High Court Appeals filed
Chandresh
Sankhla Vs.
The State of
Rajasthan &
Ors
(DBCWP No.
6653/2019)
High Court
Of
Rajasthan
at Jaipur
"Dream 11" alleged
to be betting of
cricket team and
amounting to
gambling.
Dream 11 is not betting and gambling.
• Scope of review petition filed in the Bombay HC
(Gurdeep Singh Sachar case) - only w.r.t GST and not to
re-visit the issue as to whether gambling is or is not
involved.
• "Dream 11" - having any element of betting/gambling is
no more res integra in view of the pronouncements by
the Punjab and Haryana High Court and Bombay High
Court…
1 SLP filed by
Avinash
Mehrotra
(SLP(C) No.
011794/ 2021)
was dismissed
in Supreme
Court.
Ravindra
Singh
Chaudhary
Vs UOI & Ors
(DBCWP No.
20779/2019
High Court
Of
Rajasthan
at Jaipur
(1) Whether online
fantasy sports
games offered
on Dream 11
platform are
“gambling
/betting”?
(2) GST on such
online fantasy
sports games
offered by
Dream 11?
(1) Online fantasy sports games offered on Dream 11
platform are games of mere skill as -
• Result of fantasy game depends on skill of participant
and not sheer chance;
• Winning or losing of virtual team created by the
participant is also independent of outcome of the game
or event in the real world.
(2) In light of the above findings on the issue of
gambling/betting, Court deemed it appropriate to leave the
said second issue for the GST authorities to consider in
accordance with law.
1 SLP filed by
Avinash
Mehrotra
(SLP(C) No.
015791/2022)w
as dismissed in
Supreme Court.





Agenda for 52nd GSTCM Volume 1
Page 152 of 389
Online Gaming - Potential
India to have 235
million paid gamers
by 2025
Source: RedSeer-Lumikai
report
India’s gaming
market is due to
triple in value to over
INR 57,500 crore by
2025
Source: RedSeer-Lumikai
report
Predicted to grow to
231 Billion INR by 2025
from 167 Billion INR in
2019.
Source: FICCI
15



Online Gaming
• Online gaming may be taxed
@ 28%
on full value of the bets placed
16





Agenda for 52nd GSTCM Volume 1
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Imperative to take a decision
• Litigation - a time consuming
process
• Substantial revenue
Implication
17


Issue No. 1
1) Whether any amendment in law is required?
2) Whether any amendment in law is required to specifically
include casinos, race courses and online gaming under
taxable actionable claims to remove ambiguity.
Merits
• Avoid litigation
• Ease of administration
• Ease of Doing Business
18






Agenda for 52nd GSTCM Volume 1
Page 154 of 389
Issue No.2
Whether to tax online gaming, horse racing and casinos on:
• Full face value
• GGR/platform fees
• Deemed Value (e.g. Some exemption from value)
19



Issue No 3
What should be the rate of tax ?
• 28%
• 18%
• 12%
20





Agenda for 52nd GSTCM Volume 1
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Impact on Lottery
• Taxation of lottery is settled and are paying 28% on full face value
of the lottery ticket.
• Decisions taken on Online Gaming, Casino horse racing has
implications on lottery.
• Of late, Lottery Trade Associations are representing that 28% GST
should be levied on GGR (Revenue after deduction of prize money
paid/payable)
21


Revenue Implications
Activity Tax Rate Value* Potential Revenue* (in Rs. Cr)
Casinos
28%
Full face value 2070
GGR/platform fees 310
18%
Full face value 1330
GGR/platform fees 199
12%
Full face value 887
GGR/platform fees 133
Race Courses
28%
Full face value 543
GGR/platform fees 98
18%
Full face value 350
GGR/platform fees 63
12%
Full face value 234
GGR/platform fees 42
Online gaming
28%
Full face value 11928
GGR/platform fees 1789
18%
Full face value 7668
GGR/platform fees 1150
12%
Full face value 5112
GGR/platform fees 766
*Taxable value & Potential revenue for casinos, online gaming (sample data of 6 State/zone) and race courses has been back calculated based on 6 years data
received.





Agenda for 52nd GSTCM Volume 1
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23


Betting Tax – Pre GST
24
Clubs State Rate of Betting Tax
Royal Western India Turf Club Maharashtra 20%
Hyderabad Turf Club Telangana 15%
Madras Race Club Tamil Nadu 21%
Royal Calcutta Turf Club West Bengal 10%
Bangalore Turf Club Karnataka 8%
The Mysore Race Club Karnataka 8%
Delhi Turf Club New Delhi 20%






Agenda for 52nd GSTCM Volume 1
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Online Gaming – MeitY Guidelines
• MeitY has notified amendments to Information Technology (Intermediary Guidelines and Digital Media
Ethics Code) Rules, 2021:
“online real money game‟ means an online game where a user makes a deposit in cash or kind
with the expectation of earning winnings on that deposit. Explanation.—In this clause, “winnings‟
means any prize, in cash or kind, which is distributed or intended to be distributed to a user of an
online game based on the performance of the user and in accordance with the rules of such online
game.
“permissible online game” - an online real money game that does not involve wagering on any
outcome.
Verification of online real money game.— The online gaming self-regulatory body, upon an
application made to it by its member in respect of an online real money game, may declare such
online real money game as a permissible online real money game, if, after making such inquiry as it
deems fit, it is satisfied that— (a) the online real money game does not involve wagering on any
outcome; and….
25


Potential Revenue - Casinos
[in Rupees Crore]
•
GST Collected Potential Revenue
State FY Taxable Value [GGR] GST
Taxable Value
[ Assumed Full Bet
Value]
GST @28% GST @ 18% GST @12%
Goa (Centre) 2017-18 93.94 26.30 626.27 175.35 112.73 75.15
2018-19 139.19 38.97 927.93 259.82 167.03 111.35
2019-20 112.45 31.49 749.67 209.91 134.94 89.96
2020-21 48.84 13.67 325.60 91.17 58.61 39.07
2021-22 147.82 41.39 985.47 275.93 177.38 118.26
2022-23 (Nov) 80.05 22.41 533.67 149.43 96.06 64.04
Goa (State) 2017-18 583.73 163.45 3891.53 1089.63 700.48 466.98
2018-19 986.35 276.18 6575.67 1841.19 1183.62 789.08
2019-20 974.46 272.85 6496.40 1818.99 1169.35 779.57
2020-21 431.65 120.86 2877.67 805.75 517.98 345.32
2021-22 739.25 206.99 4928.33 1379.93 887.10 591.40
2022-23 (Nov) 987.47 276.49 6583.13 1843.28 1184.96 789.98
Sikkim 2017-18 22.90 6.19 152.67 42.75 27.48 18.32
2018-19 43.58 11.58 290.53 81.35 52.30 34.86
2019-20 36.46 9.52 243.08 68.06 43.75 29.17
2020-21 19.21 5.16 128.09 35.87 23.06 15.37
2021-22 41.52 11.14 276.80 77.50 49.82 33.22
2022-23 56.78 14.15 378.55 105.99 68.14 45.43
Total 5545.66 1548.79 36971.05 10351.89 6654.79 4436.53
If Casinos are taxed @ 28%/ 18%/12% on full value of the bets placed
*Based on backward calculation taking GGR as 15% of total taxable value
26







Agenda for 52nd GSTCM Volume 1
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Potential Revenue – Race Courses
(in Rupees Crore)
If Race Courses are taxed @ 28%/ 18%/12% on full value of the bets placed
*Based on backward calculation taking GGR as 15% of total taxable value where race clubs are paying on margin.
Where race clubs are paying on full value of the bets placed, it has been duly incorporated in the taxable value
(calculated) accordingly.
27
Horse Racing
GST collected Revenue Potential
Financial Year Taxable Value GST(Actual)
*Taxable
Value
(calculated)
GST @ 28% GST @ 18% GST @ 12%
2017-18 477.04 133.39 3022.26 846.24 544.01 362.67
2018-19 690.35 188.09 3715.22 1035.35 668.74 445.83
2019-20 882.82 245.32 2156.00 599.77 388.08 258.72
2020-21 148.20 40.81 378.21 105.23 68.08 45.39
2021-22 219.59 59.57 1007.50 280.37 181.35 120.90
2022-23 291.75 78.50 1400.43 389.22 252.08 168.05
Total 2709.75 745.67 11679.63 3256.17 2102.33 1401.56


Potential Revenue – Online Gaming
Tax collected Potential Revenue
Financial
Year
Maharas
htra
UP WB
Panchk
ula
Zone
Bangalor
e Zone
Sikkim
Total GST
of
States/Zon
es
Approx.
Taxable
Value
[margin]
Approx.
taxable
value
considering
margin is
15%
GST
@28%
GST @
18%
GST
@12%
2017-18 33.84 107.5 0 0 3.77 1.96 147.07 817.06 5447.04 1525.17 980.47 653.64
2018-19 145.01 144.12 0 0 17.05 3.85 310.03 1722.39 11482.59 3215.13 2066.87 1377.91
2019-20 631.6 155.15 0 49.64 100.22 4.22 940.83 5226.83 34845.56 9756.76 6272.20 4181.47
2020-21 867.76 119.38 1.61 29.35 349.97 5.12 1373.19 7628.83 50858.89 14240.49 9154.60 6103.07
2021-22 885.89 244.6 10.17 156.38 379.64 6.22 1682.90 9349.44 62329.63 17452.30 11219.33 7479.56
2022-23
(till date)
959.4 166.24 7.72 169.3 - 10.87 1313.53 7297.40 48649.30 13621.80 8756.87 5837.92
Total 3523.51 936.99 19.5 404.67 850.65 16.11 5751.43 31952.41 213016.06 59644.50 38342.89 25561.93
If Online Gaming is taxed @ 28%/ 18%/12% on full value of the bets placed
28*Sample data from 6 States/Zones






Agenda for 52nd GSTCM Volume 1
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Annexure-6





Agenda
• Overview of GoM on IT system Reforms1
• Agenda Items for 3rd Meeting of GoM and Decisions2
• Conclusion3

Agenda for 52nd GSTCM Volume 1
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7/25/2023 3
1. Overview of GoM on IT system Reforms






GoM on GST System Reforms
 Background:
 45th meeting of GSTC, held on 18th Sept 2021: GoM reconstituted and TOR revised.
 Subsumed the earlier GoM on IT challenges and revenue mobilization.
 TOR
1. Suggest measures to make the system more effective and efficient including changes in business
processes;
2. Identify sources of evasion & suggest changes in business processes & IT systems to plug revenue
leakage;
3. Identify and suggest use of data analysis towards better compliance / revenue augmentation;
4. Identify mechanisms for better coordination between different tax administrations (States/Centre);
 Three meetings held after change of composition of GoM w.e.f. September 21,2021
 First Meeting held on 21st October 2021
 Second Meeting held on 10th February 2022 : Recommendations approved in 47th GST Council
meeting.
 Third Meeting held on 13th February 2023


Agenda for 52nd GSTCM Volume 1
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Group of Ministers (GoM) on GST System Reforms
# Designation and State
1 Deputy Chief Minister, Maharashtra Convenor
2 Deputy Chief Minister, Haryana Member
3 Deputy Chief Minister, Delhi Member
4 Minister for Finance, Assam Member
5
Minister for Finance, Planning, Commercial Taxes, Skill Development
and Training and and Legislative Affairs, Andhra Pradesh
Member
6 Minister for Finance and Parliamentary Affairs, Odisha Member
7 Minister for Finance and Human Resources Management, Tamil Nadu Member
8 Minister for Commercial Taxes, Chhattisgarh Member
The Membership of GoM is as below:

7/25/2023 6
2. Agenda Items for 3rd Meeting of GoM and Decisions







Agenda for 52nd GSTCM Volume 1
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Agenda Items of 3rd GoM
# Agenda
1 Hard locking of Table-4 of GSTR-3B
2
Tracking and identification of Non-Existent Tax Payers (NETP). It involves
i. Cancellation/Suspension of Registration of Taxpayers (TP) ab-initio
ii. Declaration of Taxpayer as NETP
3
Reporting of transactions by payment gateways & banks. To identify details of B2C sale, not reported by
taxpayers where payment is received through POS machines.
4
HSN level reporting in GSTR-1: To improve data quality, integrating and auto-population of
e-invoice/e-way bill data with Table 12 of GSTR1
5
i. Integration with Income Tax, ICEGATE and other data points.
ii. Improving collection of data on import of services.
6
Additional Agenda items:
i. MIS of commodities liable for RCM
ii. MIS report of the Auto Populated interest on account of late payment.


7/25/2023 8
Agenda Item 1:
Hard locking of Table-4 of GSTR-3B






Agenda for 52nd GSTCM Volume 1
Page 163 of 389
Agenda Item: Hard locking of Table-4 of GSTR-3B
# Agenda Decisions of GoM
1
Hard
locking of
Table-4 of
GSTR-3B
with data
from
GSTR
2A/2B to
control
ITC
Mismatch
The GoM after due deliberations took a view that presently hard locking of Table 4 of GSTR-3B with
GSTR 2A/2B data (ITC Available) is not feasible as taxpayers may face difficulties in business activities.
The GoM approved :
a. Systemic intervention in the form of spike rule based on gap in ITC utilization (threshold of
mismatch between GSTR 2A/2B and GSTR 3B suggested at Rs. 25 lakh or more) shall be
implemented in phased manner. This will be on similar line of Rule 88C (liability mismatch between
GSTR 1 and GSTR 3B).
b. Where threshold of ITC gap is crossed, an intimation to be sent to taxpayer and a online facility to be
created for taxpayer to furnish reason for such gap.
c. Further, mechanism for verification and initiation of action in non-compliant cases is to be provided.
d. In subsequent phase, filing of GSTR-1 to be blocked till the officer verifies and approve the reply filed
by the taxpayer.



7/25/2023 10
Agenda Item 2:
Tracking and identification of Non-Existent Tax Payers (NETP)





Agenda for 52nd GSTCM Volume 1
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Agenda Item: Tracking and identification of Non-Existent Tax Payers (NETP)
 Fake / Non-Existent taxpayer denotes the entity which is only engaged in issuance of fake GST
invoices i.e. without underlying supply of goods / services.
 Intent to pass the fake GST credit to defraud the revenue.
 The business activity declared in registration does not exists.
 GST registration is obtained by means of fraud or willful mis-statement like:
 Declare Non-existent or incomplete address at the time registration. Or furnish fake / forged documents of
address while taking registration.
 Identity theft by using of credentials (ADHAR, PAN, etc) of persons without their knowledge.
 Use of credentials (Mobile linked to ADHAR, PAN, etc) of innocent persons to get registration.
 Complex web / network of Fake / Non-Existent entities spread across the States / jurisdiction.
 Multi-stage layering till fake credit reaches to actual beneficiaries.
 Necessity to devise work flow based system to track the flow of fake credit.
 Consolidated information of Fake / Non-Existent entities would help in leveraging the capabilities
of predictive analysis of suspected Fake / Non-Existent entities.


Agenda Item: Tracking and identification of Non-Existent
Tax Payers (NETP)
# Agenda Decision of GoM
2
Tracking and identification
of Non-Existent Tax Payers
(NETP).
(At present letter based
requests are sent by State
Tax Administrations to
each other)
The GoM approved :
a. Formulation of SOP for handling NETP (GSTN and Maharashtra will prepare SOP)
b. Uniform policy for ab-initio cancellation of Registration of NETP across State/CBIC
Tax Administration . An SOP in this regard to be issued by Policy Wing.
c. Development of System driven solution to facilitate declaration of NETP by Tax
Administration.
d. Creation of facility to report NETP and Central repository for NETP to be
accessible to all.
e. System based communication of recipients of NETP among the States up to the
jurisdictional officer
f. Flagging of related entities of declared NETPs (including suppliers) for
appropriate action.
g. System based facility to create tasks of various actions against related parties
(including suppliers) and recipients to be developed.





Agenda for 52nd GSTCM Volume 1
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7/25/2023 13
Agenda Item 3:
Reporting of transactions by payment gateways & Banks




Agenda Item: Reporting of transactions by payment gateways
& Banks
# Agenda Decision of GoM
3
Reporting of
transactions by
Payment Gateways &
banks: To capture
details of B2C sale
where payment is
received through POS
machines by the
supplier
1. The GoM discussed the issue of reporting B2C transactions through Payment
Gateways and Point of Sale (PoS) machines, and gave in-principle approval to
this agenda item.
2. It was proposed that data from all digital payment transactions that are
processed through specific networks, such as NPCI for RUPAY, VISA,
MASTERCARD, etc shall be compiled to estimate turnover of a business.
However, peer-to-peer (P2P) digital payments were proposed to be excluded.
3. The convenor of GoM, directed to constitute an officers group & hold a meeting
in this regard in Mumbai to develop a detailed methodology & business process
to achieve the stated goal in Consultation with the RBI and the NPCI.




Agenda for 52nd GSTCM Volume 1
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7/25/2023 15
Agenda Item 4:
HSN level reporting in GSTR-1





Agenda Item: HSN level reporting in GSTR-1
# Agenda Decision of GoM
4
HSN level reporting in GSTR-1 :
Integrating and auto-population of e-
invoice/e-way bill data with Table 12
of GSTR1
The GoM approved :
a. In first phase, HSN data in Table 12 of GSTR 1, should be
auto populated from e-invoice and EWB. (In initial phase
AATO Rs. 5 Crore or more to be considered)
b. Phase wise and time bound approach to be adopted for
action against non-compliant taxpayers with nudging
messages and e-mails.
c. Blocking of GSTR 1 for failure to fill HSN will be taken up
in the later phase.



Agenda for 52nd GSTCM Volume 1
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7/25/2023 17
Agenda Item 5:
• Integration of Income Tax, ICEGATE and other data points.
• Improving collection of data on import of services.







Agenda for 52nd GSTCM Volume 1
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7/25/2023 20
Agenda Item 6:
Additional Agenda items related to MIS





Additional Agenda items related to MIS
# Agenda Decision of GoM
6
Following MIS are required to augment revenue:
1. Commodities liable for GST under RCM .
2. Auto populated interest on account of late
payment.
The GoM approved development of MIS.


Agenda for 52nd GSTCM Volume 1
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7/25/2023 22
3. Conclusion






Conclusion
While the recommendations of GoM are specific, as general direction, the GST System should
move in the following directions:-
1. Need for strengthening registration process by using biometric validations and premises
verification etc. , to remove NETPs from the system.
2. Controlling flow of fake ITC at both the ends, i.e. the recipient and the supplier of a supply.
Recipient should report B2B supply and pay tax on it and recipient should take ITC on such
reported invoice.
3. Expanding use of third party data for better forecasting of turnover and other verifications of
taxpayers.

Agenda for 52nd GSTCM Volume 1
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7/25/2023 24
THANK YOU!!









Agenda for 52nd GSTCM Volume 1
Page 171 of 389
Annexure-7
Agenda Item 11: Implementation of GSTAT
consequent to passing of Finance Act, 2023



• The final Report and recommendations of the Group of Ministers (GoM) on constitution of Goods and Services Tax
Tribunal constituted tabled before the GST Council in its 49th Meeting.
• Recommended to establish one GST Appellate Tribunal with a Principal Bench and State Benches. Each Bench of the
Appellate Tribunal to consist of four members i.e. two Judicial Members and two Technical Members, one
Member from Centre and one from the State.
• The report of GoM on GSTAT adopted by the Council with certain modifications.
• Amendments in CGST Act incorporated through Finance Act, 2023 (refer clause 149-154 of the Finance Act, 2023),
by substitution of sections 109, 110 and 114 of CGST Act, 2017 and by amending sections 117, 118 and 119 of CGST
Act, 2017.
• The GST Council may recommend a suitable date for notifying the amendments to CGST Act, 2017 made vide
Finance Act, 2023. Accordingly, the States/UTs with legislature may also notify the corresponding amendments in
their respective Acts on the same date. The GSTAT would be constituted after these amendments are notified.
Agenda



Agenda for 52nd GSTCM Volume 1
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Search-cum-Selection Committee
Section 110
(4) (a) The Search-cum-Selection Committee for Technical Member (State) of a State Bench shall
consist of the following members namely:—
(i) the Chief Justice of the High Court in whose jurisdiction the State Bench is located, to be the
Chairperson of the Committee;
(ii) the senior-most JudiciaI Member in the State, and where no JudiciaI Member is available, a retired
Judge of the High Court in whose jurisdiction the Stale Bench is located, as may be nominated by
the Chief Justice of such High Court;
(iii) Chief Secretary of the State in which the State Bench is located;
(iv) one Additional Chief Secretary or Principal Secretary or Secretary of the State in which the State
Bench is located, as may be the nominated by such State Government, not in-charge of the
Department responsible for administration of State tax; and
(v) Additional Chief Secretary or Principal Secretary or Secretary of the Department responsible for
administration of State tax, of the State in which the State Bench is located — Member Secretary;
and






Search-cum-Selection Committee
b) the Search-cum-Selection Committee for all other cases shall consist of the following members,
namely:—
(i) the Chief Justice of India or a Judge of Supreme Court nominated by him, to be the Chairperson of
the Committee;
(ii) Secretary of the Central Government nominated by the Cabinet Secretary — Member;
(iii) Chief Secretary of a State to be nominated by the Council — Member;
(iv) one Member, who—
(A) in case of appointment of a President of a Tribunal, shall be the outgoing President of the
Tribunal; or
(B) in case of appointment of a Member of a Tribunal, shall be the sitting President of the Tribunal; or
(C) in case of the President of the Tribunal seeking re-appointment or where the outgoing President
is unavailable or the removal of the President is being considered, shall be a retired Judge of the
Supreme Court or a retired Chief Justice of a High Court nominated by the Chief Justice of India;
and
(v) Secretary of the Department of Revenue in the Ministry of Finance of the Central Government —
Member Secretary
Agenda for 52nd GSTCM Volume 1
Page 173 of 389


S.No. State Name TOTAL Taxpayer
Revenue (Domestic) F.Year
2022-23
No. of Benches requested by States in Agenda
1 Uttar Pradesh 1,798,288 87969 5 (Lucknow , Varanasi, Ghaziabad, Agra and Prayagraj)
2
Maharashtra 1,676,761 270345 7 [Mumbai-2, Pune-2, Thane-1, Nagpur-1 & Aurangabad (Chhatrapati
Sambhajinagar)-1]
3 Gujarat 1,142,794 114221 3 (Ahmedabad, Surat and Rajkot)
4 Tamil Nadu 1,113,313 104377 NA
5 Karnataka 985,729 122821 3(Bengaluru)
6 Rajasthan 842,067 45458 2
7 Delhi 778,692 55843 2 (Delhi)
8 West Bengal 717,527 58059 2(Kolkata)
9 Bihar 602,293 16547 1 (Patna)
10 Madhya Pradesh 509,039 36231 1 (Bhopal)
11 Haryana 508,566 86668 2 (Hisar & Gurugram)
12 Telangana 496,953 51830 2 (Hyderabad)
13 Andhra Pradesh 414,274 40232 3 (Vijayawada, Vishakhapatnam and Tirupati)
14 Kerala 399,701 27371 3 (Triruvananthapuram, Ernakulam & Kozhikode)
15 Punjab 384,053 20949 2 (Chandigarh & Mohali)
16 Odisha 320,506 49441 1(Cuttack)
17 Assam 221,656 13710 1 State Bench of GSTAT at Guwahati, Assam
18 Jharkhand 196,868 32019 1(Ranchi)
19 Uttarakhand 195,150 16845 1(Dehradum)
20 Chhattisgarh 171,573 31968 2 (Raipur & Bilaspur)
21 Jammu and Kashmir 136,285 5246 1 (Jammu & Srinagar on rotational basis)
22 Himachal Pradesh 120,679 8778 1(Shimla)
23 Goa 41,960 5520 1 (Panaji)
24 Chandigarh* 30,436 2365 Common State Bench of Punjab (Chandigarh)
25 Tripura 30,147 883 1(Agartala)
26 Meghalaya 28,670 2075 Common State Bench of GSTAT at Guwahati, Assam
27 Puducherry 23,760 2373 1(Puducherry)
28 Arunachal Pradesh 17,137 1022 Common State Bench of GSTAT at Guwahati, Assam
29 Dadra and Nagar Haveli & Daman and Diu* 15,511 3771 Common State Bench of Maharashtra (Mumbai)
30 Manipur 13,891 614 Common State Bench of GSTAT at Guwahati, Assam
31 Sikkim 10,368 3155 Common Bench with Kolkata
32 Nagaland 10,212 566 Proposed one Bench
33 Ladakh* 7,907 333 Common State Bench of Jammu & Kashmir
34 Mizoram 7,534 418 1 (Aizwal)
35 Andaman and Nicobar Islands* 5,660 373 Common State Bench of W.B. (Kolkata)
36 Lakshadweep* 347 21 Common State Bench of Kerala
Grand Total 13,976,308 1,320,420 37
* This has been proposed by GSTCS as these are the UT without legislature. This proposal is on the basis of previous Notification issued by DoR.




Status of confirmation of Amendments to SGST/UTGST Act corresponding to formation of GSTAT
The States of Andhra Pradesh, Chhattisgarh, Gujarat, Kerala, Telangana, Rajasthan and Uttar Pradesh have defined the jurisdictions of the
Benches based on Division/Zone/Revenue division.
Karnataka and West Bengal have defined the jurisdiction of the Benches as entire state jurisdiction
For North-Eastern States, it is submitted that there are five High Courts in North-East in the States of Tripura, Sikkim, Meghalaya, Manipur
and Assam. In case of Arunachal Pradesh and Meghalaya, the GSTAT has been proposed at Guwahati, Assam. may be clarified that the
appeal arising out of GSTAT order in such cases will fall within jurisdiction of the High Court of the State where the taxpayer is located.
Meghalaya has also requested for this clarification.
Agenda for 52nd GSTCM Volume 1
Page 174 of 389
No. of Taxpayers more than 7.5 lakh
S.No. State Name TOTAL Taxpayer Revenue
(Domestic) F.Year
2022-23
No. of Benches requested by
States in Agenda
1 Uttar Pradesh 17,98,288 87969 5 (Lucknow , Varanasi, Ghaziabad,
Agra and Prayagraj)
2 Maharashtra 16,76,761 270345 7 [Mumbai-2, Pune-2, Thane-1,
Nagpur-1 & Aurangabad (Chhatrapati
Sambhajinagar)-1]
3 Gujarat 11,42,794 114221 3 (Ahmedabad, Surat and Rajkot)
4 Tamil Nadu 11,13,313 104377 NA
5 Karnataka 9,85,729 122821 3(Bengaluru)
6 Rajasthan 8,42,067 45458 2 (Jaipur & Jodhpur)
7 Delhi 7,78,692 55843 2 (Delhi)



No. of Taxpayers less than 7.5 lakh
S.No. State Name TOTAL Taxpayer
Revenue (Domestic)
F.Year 2022-23
No. of Benches requested by States in Agenda
8 West Bengal 7,17,527 58059 2(Kolkata)
9 Bihar 6,02,293 16547 1 (Patna)
10 Madhya Pradesh 5,09,039 36231 1 (Bhopal)
11 Haryana 5,08,566 86668 2 (Hisar & Gurugram)
12 Telangana 4,96,953 51830 2 (Hyderabad)
13 Andhra Pradesh 4,14,274 40232 3 (Vijayawada, Vishakhapatnam and Tirupati)
14 Kerala 3,99,701 27371 3 (Triruvananthapuram, Ernakulam & Kozhikode)
15 Punjab 3,84,053 20949 2 (Chandigarh & Mohali)
16 Odisha 3,20,506 49441 1(Cuttack)
17 Assam 2,21,656 13710 1 State Bench of GSTAT at Guwahati, Assam
18 Jharkhand 1,96,868 32019 1(Ranchi)
19 Uttarakhand 1,95,150 16845 1(Dehradum)
20 Chhattisgarh 1,71,573 31968 2 (Raipur & Bilaspur)
21 Jammu and Kashmir 1,36,285 5246 1 (Jammu & Srinagar on rotational basis)
22 Himachal Pradesh 1,20,679 8778 1(Shimla)
23 Goa 41,960 5520 1 (Panaji)
24 Chandigarh* 30,436 2365 Common State Bench of Punjab (Chandigarh)
25 Tripura 30,147 883 1(Agartala)
26 Meghalaya 28,670 2075 Common State Bench of GSTAT at Guwahati, Assam
27 Puducherry 23,760 2373 1(Puducherry)
28 Arunachal Pradesh 17,137 1022 Common State Bench of GSTAT at Guwahati, Assam
29 Dadra and Nagar Haveli & Daman and Diu* 15,511 3771 Common State Bench of Maharashtra (Mumbai)
30 Manipur 13,891 614 Common State Bench of GSTAT at Guwahati, Assam
31 Sikkim 10,368 3155 Common Bench with Kolkata
32 Nagaland 10,212 566 Proposed one Bench
33 Ladakh* 7,907 333 Common State Bench of Jammu & Kashmir
34 Mizoram 7,534 418 1 (Aizwal)
35 Andaman and Nicobar Islands* 5,660 373 Common State Bench of W.B. (Kolkata)
36 Lakshadweep* 347 21 Common State Bench of Kerala
* This has been proposed by GSTCS as these are the UT without legislature. This proposal is on the basis of previous Notification issued by DoR.





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No. of Taxpayers above 5 lakhs
S.No. State Name TOTAL Taxpayer Revenue (Domestic)
F.Year 2022-23
No. of Benches requested by States in
Agenda
1 Uttar Pradesh 1,798,288 87969 5 (Lucknow , Varanasi, Ghaziabad, Agra and
Prayagraj)
2 Maharashtra 1,676,761 270345 7 [Mumbai-2, Pune-2, Thane-1, Nagpur-1 &
Aurangabad (Chhatrapati Sambhajinagar)-1]
3 Gujarat 1,142,794 114221 3 (Ahmedabad, Surat and Rajkot)
4 Tamil Nadu 1,113,313 104377 NA
5 Karnataka 985,729 122821 3(Bengaluru)
6 Rajasthan 842,067 45458 2 (Jaipur & Jodhpur)
7 Delhi 778,692 55843 2 (Delhi)
8 West Bengal 717,527 58059 2(Kolkata)
9 Bihar 602,293 16547 1 (Patna)
10 Madhya Pradesh 509,039 36231 1 (Bhopal)
11 Haryana 508,566 86668 2 (Hisar & Gurugram)




Taxpayers less than 5 lakh and more than 40,000
S.No. State Name
TOTAL
Taxpayer
Revenue
(Domestic)
F.Year 2022-23
No. of Benches requested by
States in Agenda
13 Andhra Pradesh 414,274 40232 3 (Vijayawada, Vishakhapatnam and
Tirupati)
14 Kerala 399,701 27371 3 (Triruvananthapuram, Ernakulam &
Kozhikode)
15 Punjab 384,053 20949 2 (Chandigarh & Mohali)
16 Odisha 320,506 49441 1(Cuttack)
17 Assam 221,656 13710 1 State Bench of GSTAT at Guwahati,
Assam
18 Jharkhand 196,868 32019 1(Ranchi)
19 Uttarakhand 195,150 16845 1(Dehradum)
20 Chhattisgarh 171,573 31968 2 (Raipur & Bilaspur)
21 Jammu and Kashmir 136,285 5246 1 (Jammu & Srinagar on rotational
basis)
22 Himachal Pradesh 120,679 8778 1(Shimla)
23 Goa 41,960 5520 1 (Panaji)





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No. of Taxpayers above 40,000
S.No. State Name TOTAL Taxpayer Revenue
(Domestic)
F.Year 2022-23
No. of Benches requested by States in Agenda
23 Jammu and Kashmir 136,285 5246 1 (Jammu & Srinagar on rotational basis)
24 Dadra and Nagar Haveli & Daman and
Diu*
15,511 3771 Common State Bench of Maharashtra (Mumbai)
25 Sikkim 10,368 3155 Common Bench with Kolkata
26 Puducherry 23,760 2373 1(Puducherry)
27 Chandigarh* 30,436 2365 Common State Bench of Punjab (Chandigarh)
28 Meghalaya 28,670 2075 Common State Bench of GSTAT at Guwahati, Assam
29 Arunachal Pradesh 17,137 1022 Common State Bench of GSTAT at Guwahati, Assam
30 Tripura 30,147 883 1(Agartala)
31 Manipur 13,891 614 Common State Bench of GSTAT at Guwahati, Assam
32 Nagaland 10,212 566 Proposed one Bench
33 Mizoram 7,534 418 1 (Aizwal)
34 Andaman and Nicobar Islands* 5,660 373 Common State Bench of W.B. (Kolkata)
35 Ladakh* 7,907 333 Common State Bench of Jammu & Kashmir
36 Lakshadweep* 347 21 Common State Bench of Kerala
* This has been proposed by GSTCS as these are the UT without legislature. This proposal is on the basis of previous Notification issued by DoR.


S.No. State/ Union Territory
Population
(2011 Census) No. in Crore
1 Uttar Pradesh 19,95,81,477 19.958
2 Maharashtra 11,23,72,972 11.237
3 Bihar 10,38,04,637 10.380
4 West Bengal 9,13,47,736 9.135
5 Andhra Pradesh 8,46,65,533 8.467
6 Madhya Pradesh 7,25,97,565 7.260
7 Tamil Nadu 7,21,38,958 7.214
8 Rajasthan 6,86,21,012 6.862
9 Karnataka 6,11,30,704 6.113
10 Gujrat 6,03,83,628 6.038
11 Odisha 4,19,47,358 4.195
12 Telangana 3,51,93,978 3.519
13 Kerala 3,33,87,677 3.339
14 Jharkhand 3,29,66,238 3.297
15 Assam 3,11,69,272 3.117
16 Punjab 2,77,04,236 2.770
17 Haryana 2,53,53,081 2.535
18 Chhattisgarh 2,55,40,196 2.554
19 Delhi 1,67,53,235 1.675
20 Jammu and Kashmir 1,22,67,013 1.227
21 Uttarakhand 1,11,16,752 1.112
22 Himachal Pradesh 68,56,509 0.686
23 Tripura 36,71,032 0.367
24 Meghalaya 29,64,007 0.296
25 Manipur 27,21,756 0.272
26 Nagaland 19,80,602 0.198
27 Goa 14,57,723 0.146
28 Arunachal Pradesh 13,82,611 0.138
29 Mizoram 10,91,014 0.109
30 Sikkim 6,07,688 0.061
31 Puducherry 12,44,464 0.124
32 Chandigarh 10,54,686 0.105
33 Dadra and Nagar Haveli and Daman and Diu 5,85,764 0.059
34 Andaman and Nicobar Islands 3,79,944 0.038
35 Ladakh 2,74,289 0.027
36 Lakshadweep 64,429 0.006
Total 1,24,63,79,776 124.638






Agenda for 52nd GSTCM Volume 1
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THANK YOU


Agenda for 52nd GSTCM Volume 1
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Agenda Item 1(ii): Confirmation of the Minutes of the 51st GST Council Meeting held on 02nd
August, 2023
The 51st meeting of the GST Council was held on 2nd August, 2023 under the Chairpersonship
of the Hon’ble Union Finance Minister, Smt. Nirmala Sitharaman through Video Conference. The list
of Hon’ble Members of the Council who attended the meeting is at Annexure-1. The list of the officers
of the Centre, States, Union Territories with legislature, GST Council Secretariat and GSTN who
attended the meeting is at Annexure-2.
1.2 The following agenda items were listed for discussion in the 51st meeting of the GST Council:
TABLE OF CONTENTS

1.3 The Secretary to the GST Council, welcomed all the Hon’ble Members of the Council and
participating officers to the 51st meeting of the GST Council.
1.4 The Secretary on behalf of the Council, welcomed Dr. Pramod Sawant, Hon’ble Chief Minister,
Goa to his very first Council Meeting. The Secretary also welcomed Sh. Ajit Pawar, Hon’ble Deputy
Chief Minister, Maharashtra and Sh. B. D. Kalla, Hon’ble Member from Rajasthan who were attending
GST Council meeting after some time gap.
1.5 The Secretary appreciated the immense contribution made by Sh. Vivek Johri, ex-Chairman,
CBIC to the Council who had superannuated on 31/07/2023.
1.6 The Secretary stated that the GST Council in its 50th meeting had made certain recommendations
on taxation of casinos, race courses and online gaming and recommended levy of 28% GST on the face
value. Many Hon’ble Members had requested to make corresponding amendments in various GST Acts
and Rules at the earliest. The amendments have been drafted by the Law Committee and they form the
main agenda for this Council meeting. The Secretary informed that the Law Committee had invited
officers from Tamil Nadu during deliberation on the proposed amendments in the Acts and Rules, as
desired in the 50th meeting of the Council.
1.7 He further informed the Council that the agenda for the 51st meeting of the GST Council was
discussed in detail during the Officers’ Meeting a day before and based on the suggestion made in the
Officers’ Meeting, the revised draft Rule 31 B and 31 C pertaining to valuation rules as detailed in
Agenda Item No. 2 had been circulated and incorporated in today’s presentation.
Sl. No. Agenda Item Page No.
1. Deemed ratification of Notifications and Circulars by the GST Council and
decisions of GST Implementation Committee for the information of the Council
7-16
2. Proposal for making amendments to the CGST Act, 2017, IGST Act, 2017,
CGST Rules, 2017 and issuance/amendment of notifications pertaining to
casino, online gaming and horse racing
17-23
3. Addendum to Agenda item 2: Revised Valuation Rules- Rule 31B and Rule
31C
(As per deliberations in the Officer’s Meeting held on 01/08/2023)
-
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1.8 The Secretary stated that there were two agenda items for this meeting. The first agenda was
regarding ratification of Notifications and Circulars by the GST Council and decisions of GST
Implementation Committee for the information of the Council which were issued/taken between the
two Council Meetings. The second agenda was the proposal for making amendments to the CGST Act,
2017, IGST Act, 2017, CGST Rules, 2017 and issuance/amendment of notifications pertaining to
casinos, online gaming, and horse racing to carry forward the recommendations made by the Council
in its 50th Meeting. After taking permission of the chair to begin deliberations on each agenda item, he
asked the Pr. Commissioner, GST Policy to present both the agenda items before the Council.
2. Agenda item 1: Ratification of the Notifications and Circulars issued by the GST Council and
decisions of GST Implementation Committee for the information of the Council

2.1 The Pr. Commissioner, GST Policy took up the first agenda pertaining to the ratification of the
notifications and circulars issued by the GST Council and decisions of the GST Implementation
Committee for the information of the Council (Page 07-16 of the agenda). He stated that this agenda
was discussed in the Officers’ Meeting held yesterday and all officers had recommended approval /
ratification of the notifications and circular. He also added that subsequent to the circulation of the
agenda, eight (8) more Central Tax Notifications No. 27/2023-Central Tax to 34/2023- Central Tax all
dated 31.07.2023 and one (1) more Integrated Tax Notification No. 01/2023-Integrated Tax dated
31.07.2023 have been issued based on the recommendations of the Council made in 50th meeting. He
requested the Council to ratify the notifications and circulars issued based on the recommendations by
the GST Council and take note of the decisions of the GST Implementation Committee (GIC).

Decision: The Council ratified the notifications and circulars issued based on the
recommendations by the GST Council and took note of the decisions of GST Implementation
Committee.
3. Agenda Item 2 :- Proposal for making amendments to the CGST Act, 2017, IGST Act, 2017,
CGST Rules, 2017 and issuance/amendment of the Notifications pertaining to the Casino, Online
gaming and Horse Racing

3.1 The Pr. Commissioner, GST Policy took up the next agenda regarding amendments in CGST
Act, IGST Act, CGST Rules, and issuance of notifications pertaining to taxability of online gaming,
casinos, etc. He made the detailed presentation (attached as Annexure-3) on the recommendations
made by the Law Committee and the discussion made in the Officers’ meeting on the said agenda. He
stated that the Revenue Secretary had already mentioned that the actionable claims supplied in casinos,
online gaming, and horse racing were agreed to be made taxable at 28% on full face value irrespective
of whether activities are games of chance or game of skill in 50th GST Council Meeting. He stated that
the matter was discussed in the two meeting of the Law Committee held on 21st July and 27th July, 2023
and various amendments in CGST/IGST Acts were deliberated. Thereafter, the Law Committee made
certain recommendations regarding amendments in the CGST Act 2017, IGST Act 2017 and CGST
Rules 2017 as well as issuance/ modification of notification.

Amendment in CGST Act, 2017 and IGST Act, 2017
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3.2 The Pr. Commissioner, GST Policy stated that Entry 6 of Schedule III of the CGST Act 2017 is
proposed to be amended to exclude “specified actionable claims” from the said Entry to provide clarity
regarding taxability of actionable claims involved in Casino, Horse racing and Online game.
3.3 Further, clause (102A) was proposed to be inserted in Section 2 of CGST Act to define
“specified actionable claim” so as to mean actionable claim involved in or by way of (i) betting; or (ii)
casinos; or (iii) gambling; or (iv) horse racing; or (v) lottery; or (vi) online money gaming. The clause
(80A) was proposed to be inserted in Section 2 of the CGST Act for defining “online gaming”. The
clause (117A) was also proposed to be inserted in Section 2 of the CGST Act for defining “virtual
digital assets” as having the same meaning as assigned to it in section 2(47A) of Income Tax Act, 1961.
3.4 The Pr. Commissioner, GSTPW, then referred to the insertion of clause (80B) in Section 2 of
the CGST Act for defining “online money gaming” which is as under:
"online money gaming " means online gaming in which players pay or deposit money
or money's worth, including virtual digital assets, in the expectation of winning money
or money's worth, including virtual digital assets, in any event including game, scheme,
competition or any other activity or process, whether or not its outcome or performance
is based on skill, chance or both and whether the same is permissible or otherwise under
any law for the time being in force.
3.5 A proviso was also proposed to be inserted in clause (105) of Section 2 of the CGST Act which
defines “supplier”. The Pr. Commissioner, GST policy stated that the said proviso is proposed to be
inserted to provide clarity to identify the supplier in case of specified actionable claims.
3.6 The Pr. Commissioner, GST Policy took up the amendment regarding the taxability of cross-
border supplies of online money gaming by a supplier located outside India to a person in India. The
proviso to Section 5 of IGST Act is proposed to be amended so that the integrated tax on goods, other
than goods as may be notified by the Government on the recommendations of the Council, imported
into India shall be levied and collected in accordance with the provisions of Section 3 of the Customs
Tariff Act, 1975 on the value as determined under the said Act at the point when duties of customs are
levied on the said goods under Section 12 of the Customs Act, 1962.
3.7 A new Section 14A is proposed to be inserted in IGST Act to provide for special provision for
taxability of supply of online money gaming by a person located outside the taxable territory to a person
in India, inter-alia to specify liability on the said supplier for payment of integrated tax on such supply.
Section 14A also provides the provision of a single registration of the said supplier through the
Simplified Registration Scheme and the power to the Government for blocking of access by the public
in case of failure to comply with the provisions. He, thereafter, stated that besides these amendments,
there are some other amendments that are proposed in CGST Act and IGST Act which are detailed in
the agenda and were discussed in detail in officers’ meeting and were agreed to. He stated that some
consequential amendments would be required in registration and return related provisions in CGST
Rules with reference to the suppliers covered under the proposed section 14A of IGST Act.
Issuance of notification under section 15(5) of CGST Act 2017
3.8 The Pr. Commissioner, GST Policy mentioned that Section 15 (5) of CGST Act, 2017 provides
that notwithstanding anything contained in section 15 (1) and 15 (4) of CGST Act, 2017, the value of
such supplies, as may be notified by the Government on the recommendations of the Council, shall be
determined in such manner as may be prescribed.
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3.9 Law Committee recommended to notify supply of online money gaming, supply of online
gaming other than online money gaming and supply of actionable claims in casinos under section 15
(5) of CGST Act 2017 for prescribing the manner of determination of the value of these supplies through
CGST Rules, 2017. The draft notification recommended by the Law Committee had been attached in
the agenda.

Amendment in CGST Rules, 2017 for prescribing value of supplies of online gaming and
actionable claims in casinos

3.10 The Pr. Commissioner, GST Policy then took up the issue of amendment in CGST Rules, 2017
for prescribing the value of supplies of online gaming and actionable claims in casinos. The same was
deliberated in the Law Committee and thereafter recommendations were made. The Law Committee
recommended insertion of Rule 31B and Rule 31C in CGST Rules for prescribing the manner of
determination of value of supplies in case of online gaming and value of supply of actionable claims in
case of casino. He stated that the matter was deliberated in officers meeting held the previous day and
various States made some recommendations. After taking into consideration the recommendations
made by various States, a revised formulation of the said rules was made and circulated. He stated that
in the agenda, which was circulated earlier, the words ‘or payable’ after the words ‘total amount paid’
are proposed to be inserted in Rule 31B and 31C of CGST Rules as per the discussion in Officers’
meeting.

3.11 Pr. Commissioner, GST Policy stated that one of the concerns was that the money could directly
be used in the slot machines instead of tokens or coins to address which it was proposed to add a sub-
clause (ii) in Rule 31C in the definition to provide that value of supply shall be the total amount paid
or payable by or on behalf of the player for participating in any event, including game, competition or
any other activity or process, in the casino, in cases where the token, chips, coins or tickets, by whatever
name called, are not required.

3.12 Further, he also stated that, it is proposed to add an Explanation to Rule 31B and Rule 31C to
state that any amount received by the player by winning any event, including game, scheme,
competition or any other activity or process, which is further used for playing by the said player in an
event without withdrawing, shall not be considered as the amount paid or deposited with the supplier
by or on behalf of the said player. This recommendation was agreed upon in the officer’s meeting.

3.13 He further mentioned that in the Officers’ meeting, Sikkim, Goa and Karnataka had raised the
issue of treatment of refund/ return of the money to the players on account of unused chips or tokens in
the case of casinos and unused wallet amounts in the case of online gaming. It was suggested to clarify
the issue so as to remove any ambiguity that the tax once paid cannot be refunded or netted.

3.14 The Pr. Commissioner, GST Policy proposed a formulation in relation to treatment of refund or
return of money to the players. He stated that the proposal was to insert a proviso in proposed Rule 31B
to provide that any amount returned or refunded by the supplier to the player for any reason whatsoever,
including the reason that the player has not used the amount paid or deposited with the supplier for
participating in any event, shall not be deductible from the value of supply of online money gaming. He
stated that it is also proposed to insert a similar proviso in rule 31C to provide that any amount returned
or refunded by the casino to the player on the return of token, coins, or tickets, as the case may be, or
otherwise, shall not be be deductible from the value of supply of actionable claims in casino.
Agenda for 52nd GSTCM Volume 1
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Amendment in Notification No. 66/2017-Central Tax dated 15.11.2017 to exclude specified
actionable claims:

3.15 The Pr. Commissioner, GST Policy, then took up the issue of amendment in Notification No.
66/2017-Central Tax dated 15.11.2017. The said notification was issued to exempt all registered persons
from the requirement of payment of tax at the time of receipt of advances in case of supply of goods
and provides for payment of tax in such cases at the time of supply as specified in Section 12(2)(a) of
CGST Act. Law Committee recommended amendment in Notification No. 66/2017-Central Tax to
exclude registered persons making supply of specified actionable claims as defined in proposed clause
(102A) of section 2 of the CGST Act from the said exemption, so that in case of specified actionable
claims, the tax can be paid at the time of receipt of payment for such supplies by the suppliers.

Suggestions made in the Officers meeting held on 01.08.2023 to be deliberated by the Law
Committee: -

3.16 The Principal Commissioner, GSTPW mentioned that in Officers’ meeting, Kerala had
suggested that in the case of online gaming, recording of PIN code of the recipient by the supplier
should be made mandatory to record the place of supply. This issue was discussed and it was
recommended that whether pin code or State code would be sufficient for the determination of Place of
Supply is a broader issue related to online supplies of various goods and services. This aspect should
be decided in the case of all the online supplies of goods and services and Law Committee should
examine it and then bring it before the Council. He further stated that the suggestion of Haryana to
include “virtual digital assets” in the definition of “consideration” in section 2 (31) of the CGST Act
2017 was also discussed and it was noted that this is also a larger issue and requires separate
examination by the Law Committee.

3.17 The Pr. Commissioner, GST Policy then took up the suggestion put forth by Gujarat wherein it
was suggested that amendment may be made in section 17(5) of CGST Act for blocking of the ITC on
account of tax paid by business entities for their employees in relation to online gaming or casinos. He
stated that the issue was discussed in Officers’ meeting and it was recommended that this issue can be
separately examined by Law Committee, as this issue may not require amendment in law.

3.18 After the presentation of the Principal Commissioner, GSTPW, the Secretary opened the floor
for suggestions/comments from the Members of the Council.
3.19 The Hon’ble Member from Tamil Nadu informed that some specified online games and online
gambling are prohibited in the State of Tamil Nadu and therefore in view of the same, they have
suggested for modifications in the amendment proposed by the Law Committee in Section 2 (102A)
and Section 2 (80B) of the CGST Act. He also mentioned that a letter in this regard, has also been sent
to the Hon’ble Chairperson for kind consideration.
3.20 The Secretary clarified that irrespective of the fact that whether an activity is legal/illegal or
banned, it is liable to tax under GST Law. All activities like betting, casino, gambling, horse racing,
lottery, online money gaming have therefore been included in the definition of ‘specified actionable
claim’ treating such activity to be a supply and hence taxable under GST Act. Prohibition of any of
these activities in any State and taxability of such activities under GST law are two separate issues and
are covered under separate Acts. Taxing a banned/prohibited activity by no means legalises the said
activity in a particular State where it is banned/prohibited. He further brought to the notice of the
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Council that while drafting the proposal for amendments in the relevant sections of CGST Act, the ASG
had also held the same view.
3.21 The Hon’ble Chief Minister of Goa requested the Council to reconsider the decision taken in
50th GST Council Meeting of taxing the casino sector at 28% on full face value of chips sold instead of
Gross Gaming Revenue. He stated that the business model of casino and online gaming should not be
treated at par. The decision of the Council would damage the economy of the State as casino sector
significantly contributes to the employment and economy of Goa. He requested the Council to
reconsider the decision of imposing tax on full face value of chips sold and support Govt. of Goa to
maintain the method of taxing on Gross Gaming Revenue.
3.22 The representative of Goa stated that casino industry is limited to only two States i.e Sikkim and
Goa and this decision would adversely affect the casino industry leading to its closure. Non-refund of
tax on return of chips in casino sector will promote unethical practices in the casino industry and
requested for re-consideration of this issue in GST Council meeting.
3.23 The Hon’ble Member from Kerala informed that he is in general agreement with the decision
taken in 50th GST Council Meeting. However, he raised the issue of Place of Supply in case of online
gaming and suggested that in case of online gaming, recording of PIN code of the recipient should be
made mandatory. He therefore requested that specific provision for recording of PIN code be notified
so that consuming State could get their due revenue.
3.24 The Secretary suggested that the issue of requirement of PIN code of the recipient and Place of
Supply is a larger issue and not only related to online gaming but also to other online supplies as well.
Therefore, it may be separately examined in detail by the Law Committee including all cases of online
supply of goods and services. He also recommended that the Law Committee should come up with the
formulation in the future GST Council Meeting.
The Council agreed to the issue of referring the matter to the Law Committee.
3.25 The Hon’ble Member from Sikkim seconded the views of the State of Goa. He further stated
that Sikkim is a small landlocked State having population of only six lakh and major source of
livelihood is through casino industry. He stated that high levy of 28% on the value of chips purchased
would lead to closure of casino industry and render many people in the State jobless. He requested that
as per international practice, GST should continue to be imposed on GGR. He also suggested that if
government desires rate of GST on casino sector could be increased from 28% to 35 % but valuation
should be done on the Gross Gaming Revenue. He therefore requested that the Council should
reconsider the decision of imposition of levy of 28% on full face value of chips.
3.26 The Hon’ble Member from Delhi requested for reconsideration of decision on levying higher
rate of 28% on online gaming. She mentioned that online gaming industry is a growing start-up; it is
extremely diverse sector and all games may not involve gambling/betting. There is also casual gaming
which is not comparable to casino, betting or horse racing. Online gaming sector has received
substantial FDI and the decision to levy higher rate of 28% will have serious repercussions on the entire
start-up ecosystem and employment provided by this sector. She requested that the proposed
amendment in Section 2 (102A) to modify the definition of ‘specified actionable claim’ may not be
carried out and if needed, the issue of online gaming may be either referred back to the GoM or a
separate GoM be constituted specifically for ‘Online Gaming’.
3.27 The Hon’ble Member from Rajasthan informed that Information Technology (Intermediary
Guidelines and Digital Media Ethics Code) Rules, 2021 were issued by the Union Ministry of
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Electronics and Information Technology (MeitY) in which the detailed guidelines for online gaming
have been prescribed and these rules were further amended vide amendment dated 06th April, 2023 to
define the concept of permissible online game and permissible online real money game. Since these
guidelines cover the concept of permitted online gaming, therefore, clubbing online gaming with betting
and gambling under GST Law would be contrary to the spirit of the Information Technology
(Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 and even imposition of same
28% tax rate on online gaming does not separate online gaming from betting and gambling. Therefore,
these should be kept in different categories. He requested that the recommendation of GST Council to
levy tax on the full face value paid for casino, race course and online gaming should be examined in
detail before taking final decision regarding the value of supply.
3.28 The Hon’ble Member from Bihar supported the proposal to levy higher tax rate on gambling as
it would not only increase the revenue of the Centre and States but it also has social and moral
connotations. The Hon’ble Member further requested the Members of the Council to bring the proposed
amendment bill to implement recommendation of GST Council on casino, race course and online
gaming as soon as possible. The Hon’ble Member from Bihar thanked the Chairperson for inclusion of
settlement amount of States in PIB releases. Further, the Hon’ble Member from Bihar requested the
Chairperson to help Bihar in determining the actual potential of GST collection in the State. He further
suggested that institutions like NIPFP may help Bihar in determining the revenue potential of its market
activities, business and trading transactions. The Hon’ble Member suggested to include some indicator
in online gaming to identify actual location of player so that tax collection goes only to concerned State
only.
3.29 The Hon’ble Chairperson thanked the Member from Bihar for his inputs and assured that in
respect of revenue collection potential if there is any possible help that institute like NIPFP can provide
to Bihar, then they will certainly provide the same.
3.30 The Hon’ble Member from Punjab stated that they agreed with the views of the Hon’ble Member
from Delhi and suggested for constitution of new GoM or to send the issue to GoM once again for
detailed examination. Further, he suggested that if players purchased chips on platforms provided by
casino or online games and paid the GST on such purchased chips, then players should not get refund
on amount not used for playing or purchases returned by players.
3.31 The Hon’ble Member from Chhattisgarh raised the issue regarding the PIN code in relation to
determining place of supply and stated that the anyone can use wrong PIN code on online gaming
platform and therefore IP address of the devices may be taken from the companies as IP address is
easily traceable. He suggested the use of IP address for tracing the players in online gaming would be
very useful for determining Place of Supply
3.32 Further, the Hon’ble Member from Chhattisgarh expressed his full agreement with the Hon’ble
Member from Bihar and suggested not to reopen issues which were debated in detail. Subsequently, he
sought clarification in respect of Agenda Item 2 with serial no. (iv) regarding definition of online
gaming. He stated that there are many games which do not appear to be gambling at first and apparently
seem to be harmless. In these games, the gamers introduce the options for players to make investments
and buy coins or points, then these games should also be treated as gambling and the same may be taken
for consideration. The Hon’ble Member from Chhattisgarh also suggested to have some provision for
continuing Compensation Cess for two affected States if they suffer fall in their revenue. He reiterated
to stick to the decision of the GST Council and implement the rules accordingly.
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3.33 The Revenue Secretary thanked the Hon’ble Member from Chhattisgarh and clarified that his
suggestions on online games with stakes and games without stakes will be considered.
3.34 The Hon’ble Member from Meghalaya stated that he had two points to make. First point was
regarding Rule 31B which states that the supply shall be total amount paid to or deposited with the
supplier by way of money or money’s worth. He informed that there are three scenarios in this online
gaming taxation. The first scenario which prevailed before the bringing the proposal of taxation of
casino, race course and online gaming in GST Council which means that 18% tax was being charged
on platform fee on every transaction being played. The second scenario in which tax at the rate of 28%
on full amount of each game would lead to large amount of taxation. In the third scenario, the tax rate
of 28% is payable only when one buys the chips in casino. If the third scenario is implemented, it may
not lead to much revenue growth.
3.35 The Revenue Secretary clarified that tax at the rate of 28% would be paid only once on
transaction amount paid to online gaming operator. Suppose a person pays Rs.100 for a game then he
has to pay 28% tax on this transaction. Earlier the online gaming operator was paying tax only on
GGR/platform fee at 18% rate. Suppose that on playing a game of Rs.100, platform fee was 15% and
online gaming operator paying tax at rate of 18% which was resulted in tax amount of only Rs.2.7. It
was found that on an average, a person plays 3 times and therefore, for a game of Rs.100, average tax
amount was collected by Government was only about Rs.8-10. However, now if they pay 28% on game
of Rs.100 then GST of Rs.28 would be collected which is around 3 times more than tax collected
earlier. Further, the Revenue Secretary added that if GST@ 28% is charged on each bet amount, then
tax would be charged on each and every winning amount which would further increase the effective tax
rate to above 28% and effective tax rate would become very high. It is also very difficult to tax on each
bet in casinos and even in online gaming, accounts are liable to fudging. The Revenue Secretary stated
that in the proposed framework it is expected that revenue would increase by 3 to 4 times, if volumes
remain the same.
3.36 The Hon’ble Member from Haryana thanked the Hon’ble Chairperson for accepting one of their
demands in the officers meeting on crypto assets. The Hon’ble Member expressed his concern on online
gaming because Haryana is hub of IT industry. He further informed that online gaming has now become
a sport in Commonwealth Games. He emphasized the need to relook into all aspects of online gaming
including the future of gaming industry and not only regarding game of skill or game of chance. The
Hon’ble member also expressed his concern over how foreign trading of crypto currency takes place
where evasion of tax happens. He also informed that tax can be levied up to 40% under GST Act. He
further added that Council may look into how other countries are taxing these activities and suggested
that we may increase the rate of tax but keep the valuation on GGR which will also take care of demand
of Goa and Sikkim.
3.37 The Hon’ble Member from Puducherry stated that the UT of Puducherry proposed to ban online
gaming and they are awaiting suggestions from Ministry of Home Affairs and MeitY for bringing
legislation to ban online games. The Hon’ble Member also expressed his agreement with taxing of
betting, gambling, casinos, online games at 28% on face value. Apart from that, in order to give a wider
definition, the word "wagering" which means 'risk (a sum of money or valued items) against someone
else on the basis of the outcome of an unpredictable event may be included in section 2(102A) of CGST
Act, 2017.
3.38 The Hon’ble Member from Andhra Pradesh stated that the State of Andhra Pradesh reiterates
its stand taken in the last GST council meeting. He stated that the issue of taxation on casino, race
course and online gaming involves both taxation from the GST point of view and revenue from the
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State point of view. The Member highlighted the issue regarding hill States, North-Eastern States with
international borders, small States specifically Goa; that the economic activity of these States like Forest
and Mining are constrained by environmental and infrastructural challenges. He further stated that the
economy of Goa depends on tourism and Casinos. The Hon’ble Member suggested that as Goa accepted
28% rate of tax on Casinos, liberal and flexible view may be taken on the value on which tax will be
levied in the interest of co-operative federalism and growth of the small States like Goa.
3.39 The Hon’ble Member from Karnataka supported the view taken by Chhattisgarh and Bihar. He
further stated that it is not desirable to go back on well considered decision taken after a thorough
discussion in a short span of time. He further stated that all the efforts should be made to harness the
full potential of revenue without showing any differential consideration for activities like betting which
are not socially desirable. The Hon’ble Member expressed agreement with CM of Meghalaya on taxing
every iteration of betting in a game. He clarified on the question of double taxation involved with taxing
such iterations and stated that each subsequent act of wagering is an independent activity and not a
consequence of first act of wagering or betting and therefore is liable for taxation. He further opined
that taxing only entry deposit and not the further iterations of the game could lead to missed taxation
opportunities. He further informed that current tax of 18% on GGR, with average 3 iterations, resulted
in tax of 6% only but new proposed rate of tax @ 28% on entry deposit, the tax might go up by 22%,
which is still an improvement but ideally each iteration of a game should be taxed. He further urged to
move swiftly on the decision taken by the Council and suggested to revisit it after six months based on
gained experience and formulation of new laws to counter avoidance of taxes.
3.40 The Hon’ble Member from Meghalaya clarified that he was not advocating taxing every iteration
or every transaction.
3.41 The Hon’ble Member from Uttar Pradesh stated that a decision was taken in the 50th GST Council
meeting on the issue of casinos, race course and online gaming after long discussions and that he
supported the proposed amendments. The Hon’ble Member emphasised that public perception should
be taken into account during framing of laws & rules in matter of taxation. He further stated that States
should strive to utilize its resources and promote tourism to augment revenue rather than basing the
economy solely on Casino. The Hon’ble Member supported the proposal of Kerala on the subject of
Place of Supply and expressed his agreement to the matter to the Law Committee.
3.42 The Hon’ble Member from West Bengal stated that the Council had taken the decision in its
50th meeting on the issue of Casinos, Race Course and Online Gaming after discussions and it should
not be reopened. She expressed agreement with the Hon’ble Member from Uttar Pradesh that the issue
had come to an end as the entire issues was discussed in last meeting of the Council held on 11th July,
2023 and the present matter of discussion was regarding changes in proposed Rules by the Law
Committee. It is always open for the Council to re-visit it if anyone finds difficulties.
3.43 The Secretary added that as most of members agreed to the proposal in the agenda, the
amendment is required to be carried out in CGST Act by the Centre and in SGST Acts by the States
and they have to be synchronised. He elicited the views of the Hon’ble Members in carrying out the
requisite amendments in two months so that they can be made effective from 01.10.2023.
3.44 The Hon’ble Member from Delhi expressed her disagreement with the decision taken by the
Council on the issue of Online Gaming. She also opined that the decision taken on Online Gaming will
have wider impact on entire Start-up Sector. She urged that Online Gaming activities should not be
conflated with gambling activities. She further added that the decision of the Council would enable
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illegal betting and gambling sites which will operate from tax havens and will push Online Gaming
sector from legal space into illegal space.
3.45 The Revenue Secretary clarified that the amendment presented in the Council pertains to the
domain of Online Gaming exclusively where stakes are involved and not to the entire online gaming
industry. It is important to note that the proposed definition merely states that instances involving
monetary consideration or stake on an outcome that one expects, will be treated as an actionable claim
and thus subject to taxation. He apprised the esteemed Members that the focal point of the discussion
does not concern tax rates as the Council has already made decisions on tax rates for Online Gaming,
Casinos and related areas during its 50th Meeting.
3.46 Regarding the concern raised by the Hon’ble Member from Delhi concerning illegal and offshore
Online Gaming Platforms, the Secretary clarified that after thorough deliberation, Law Committee has
recommended an amendment to the Act. This amendment seeks to introduce a specific provision
mandating the appointment of a local representative for any entity located outside India. Additionally,
the Secretary informed the Council that non-compliant entities would be blocked.
3.47 The Secretary requested to implement the decision that was already taken in the previous
meeting. Furthermore, the Secretary proposed the recommendation for amendments and their impact
on the Online Gaming Industry or Casinos could be re-evaluated by the Council after a period of say 6-
8 months. This approach would allow for a timely implementation of the decision while also providing
an opportunity to assess any adverse effects on the concerned Sectors in due course, if any.
3.48 On the request of the Secretary, the Member (Compliance), CBIC apprised the Council about
the offshore Online Gaming Companies. He stated that the matter regarding these Companies was
investigated by the Director General of GST Intelligence and the Companies which were not compliant
with the GST laws, were referred to the MEITY for blocking. He apprised the Council that an order
for blocking these Companies has been passed by the MEITY which was now being implemented by
the DoT.
3.49 The Hon’ble Member from Delhi stated that she did not doubt the intent of the Council but was
concerned about the IT abilities of these illegal Companies. She pointed out that the time taken by the
Government procedure and formalities to pass an order for blocking these Companies resulted in
creation of a number of mirror websites by these setups. She stated that if the recommendation to include
online money gaming as an actionable claim is to be implemented, then the Council must be cognizant
of the fact that it would promote illegal gambling. She emphasized that such a move would not only
impact the Online Gaming Industry but also the entire Start-up ecosystem.
3.50 She highlighted that there was still a juncture to address this concern and once the Council
passed the legislation, any future change would become very difficult.
3.51 The Chairperson responded to the concerns raised by the Hon’ble Member from Delhi and
assured that all the points brought forward had been under deliberation since the beginning and were
considered comprehensively. The final decision taken in the last meeting was a collective wisdom of
Council involving all the members including Delhi who carefully weighed each and every point.
3.52 She brought out that the stakeholders referred by the Hon’ble Member from Delhi had been
given ample opportunities to engage with the Council. These stakeholders had met with the Council
separately, as a group, and as representatives in the Group of Ministers (GoM) specifically formed to
address this issue, over a period of three years. The Chairperson emphasized that the Council was fully
conscious of the significance of the nascent start-up ecosystem, particularly within the growing online
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gaming industry. She made it clear that the Council was determined to ensure that the decision taken
would not have any adverse impact on this area of growth. Throughout the past years, the Council had
diligently worked on this matter and took into account various factors including investments, the start-
up industry and their potential spillover effects on the investment environment in the country. These
considerations were thoroughly weighed while arriving at the decision in the last meeting. The
Chairperson asserted that the Council has duly considered the impact of this decision on investments in
this sector as well.
Furthermore, she assured the Members that the officers could share the representations received
from various gaming industry stakeholders, investors, and other concerned parties. The Chairperson
made it clear that the Council was not devoid or unaware of the inputs from the gaming industry; rather,
there had been multiple meetings with the industry over the years to address their concerns. The
Chairperson reiterated that the issues at hand had been subject to extensive deliberations and re-
deliberations over the past three years. The Council was committed to making an informed and
thoughtful decision that considered all perspectives and potential consequences.
3.53 The Hon’ble Member from Meghalaya concurred with the Chairperson acknowledging that
every point has been thoroughly deliberated over the course of several years. He reiterated that the
decision in question had been reached by consensus during the 50th Meeting of the GST Council. He
clarified that the purpose of the current discussion was not to alter the decision taken in the last meeting
but rather to progress in determining the full-face value of the supply to be taxed.
3.54 The representative of Goa expressed that he has consistently supported the 28% tax rate as
decided by the Council for the Casinos. His concern lies primarily in the methodology to be
implemented in the law for its execution. He drew attention to the proposed amendments for online
gaming, which he believed bring the relief intended.
He emphasized that the Casino Industry is confined only to the States of Goa and Sikkim. While
he clarified that he did not endorse Casinos, he was worried about the economic repercussions on these
States as a substantial portion of their revenue depends on the Casino Industry. He pointed out that the
concept of 'full face value' remains ambiguous, especially considering that certain activities in Casinos
also involve direct payments from credit card, etc. without the need for purchase of chips.
He recommended that the Law Committee together with State of Goa and Sikkim,
collaboratively devise rules that align with a system not detrimental to the Casino Industry. He noted
that the Ministry of Electronics and Information Technology (MeitY) is working on framing Rules for
self-regulatory bodies for Online Gaming and Casinos indicating that the Council has the competence
to establish differential rules for defining 'full face value' for the Casinos.
He expressed gratitude towards the Chairperson for previously referring the matter back to the
Group of Ministers (GoM) for reconsideration. He suggested that the taxation should be aligned with
the tax charged in the pre-GST era. He also opined that taxing on the basis of Gross Gaming Revenue
(GGR) would have been a wise decision, benefiting all industries and the government. He concluded
by disagreeing with the decision taken by the GST Council as he firmly believe it would adversely
impact State of Goa and the Casino Industry.
3.55 The Hon’ble Member from Nagaland acknowledged the extensive discussions that took place
during the meeting, wherein diverse perspectives were expressed by various States. He reminded the
Council of the decision made in the previous meeting, where a consensus was almost reached to tax
Casinos at 18%. However, this decision was later finalized at a 28% tax rate based on the inputs
provided by the State of Uttar Pradesh. The reasoning behind this decision was to avoid any negative
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public perception and criticism for promoting gambling as a lower tax rate might not be socially
acceptable considering the moral values and revenue implications. He emphasized that the Council had
resolved to implement the decision for a period of six months and would reassess if it would be
necessary. He advocated closing the matter. In consideration of the affected States, Goa and Sikkim, he
proposed referring the matter to the Group of Ministers (GoM) for examination and resolution or
providing compensatory measures to address the specific challenges faced by these States in case of
Casinos.
3.56 The Hon’ble Member from West Bengal asserted her stance on the matter, firmly stating that
the issue has been thoroughly discussed in the current meeting and the 50th Council meeting. She
mentioned that the Law Committee had also presented its report and it was imperative to implement it
at present. However, she stated that if any adverse consequences arose due to the implementation, the
matter could be brought back to the table for further review.
3.57 The CST, Maharashtra sought permission to speak on behalf of the Hon’ble Member from
Maharashtra as he was preoccupied in unscheduled and unavoidable work during ongoing Assembly
session. The CST presented his views and stated that the decision was taken in the 50th meeting of the
Council to charge 28% tax on full face value and the State of Maharashtra was in agreement to all the
amendments proposed in the Council agenda. He further stated that this issue has been longstanding for
last almost 2.5 years due to which the revenue of the governments was also getting affected thus, the
issue should be implemented steadfast, which could be reviewed again in the Council meeting if any
need arose.
3.58 The Hon’ble Member from Gujarat urged the Council to move forward with the proposed
amendments without delay, considering the prolonged deliberations and the urgency to address the
revenue concerns.
3.59 The Hon’ble Member from Chhattisgarh appealed to Goa that decisions taken with the greater
wisdom of the Council were certainly in the interest of all the States in the long run. He then apprised
the Council about the forthcoming elections in his State in November and the enforcement of Code of
Conduct from October, thus, they would bring the ordinance before 01.10.2023.
3.60 The Hon’ble Member from Himachal Pradesh stated they desired early implementation of the
decision taken in the 50th meeting and endorsed the amendments proposed. He also ensured that the
State would bring the enactments within the two months so that the State could take the benefit from
the decision on an early date.
3.61 The Hon’ble Member from Haryana sought clarification on whether the commission or platform
fee charged by companies would be subject to taxation again considering the tax being imposed on the
face value at 28%.
3.62 In response, the Secretary clarified that such double taxation would not be applicable. There
would be no need to tax the commission or platform fee separately. The Secretary also mentioned the
possibility of issuing a formal clarification to address this matter definitively.
3.63 The Hon’ble Member from Delhi sought clarification on the taxation of TDS (Tax Deducted at
Source) on the winnings in the gaming sector. She expressed concern that a player would end up paying
both 28% GST and 30% TDS on their winnings.
3.64 The Secretary explained that winnings are subject to income tax and a clarification has already
been issued regarding it and the industry is satisfied with it. He mentioned that the income tax is charged
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on the net winnings of an individual for the year. The Secretary clarified that TDS is applicable only
when there are winnings and if there are no winnings, there would not be any TDS deduction.
3.65 The Chairperson clarified that TDS is a component of direct taxation. The Chairperson clarified
that matter of direct taxation does not fall under the purview of the GST Council.
3.66 The Member from Delhi acknowledged the clarification but suggested that the Council should
consider revising the tax rate to provide some relief, as it would add to the overall taxation burden on
the gaming industry.
3.67 The Secretary clarified to the Council that the current agenda of meeting solely pertained to the
implementation of decisions taken in the 50th Council meeting. The proposed amendments in CGST
Act and IGST Act were only meant to provide enabling provisions so that online money gaming like
gambling continues to be subject to taxation. He emphasized that these amendments did not concern
tax rates or the valuation of supply, which would require going through the legislative process. The
valuation methods and tax rates are provided in the Rules and notifications, which can be amended by
the Council at any time if any adverse impacts arise.
The Secretary further informed the Council about a Special Leave Petition filed against the
judgment of the Hon’ble High Court of Karnataka in the case of M/s Gameskraft wherein it is being
contested that these online gaming has an element of gambling/betting and must be taxable. The Council
is making it clear that online money gaming, casinos, or horse racing are taxable irrespective of the
presence of elements of betting or gambling through the decision taken in the 50th meeting.
3.68 While noting that all of States are in agreement, he acknowledged the differing viewpoints of
Goa, Sikkim, Delhi and Punjab. Nonetheless, he urged the Council to proceed with implementation
highlighting the possibility of revisiting the decision should the need arise. The Secretary informed the
Council that similar apprehensions were made when 28% tax was proposed to be charged in case of
lottery and it was feared that time also that the industry would be wiped out but that is not the case now.
He acknowledged all the fears and apprehensions stated by the State of Goa and Sikkim. He assured
them the Council has always worked for the betterment and development of each State. The Secretary
appealed for unanimous approval of the decision, pointing out that a review would take place after six
months of implementation. A comprehensive status report, encompassing revenue data and
stakeholders' feedback, would be assessed during this review period, allowing the Council to make
informed decisions while moving forward.
3.69 The Hon’ble Member from Tamil Nadu expressed his concern that the apprehensions of State
were not fully considered before taking a unanimous decision.
3.70 The Chairperson responded to assure the Member that the concerns of Tamil Nadu were indeed
taken into account. She pointed out the specific concern raised by Tamil Nadu about the possible
anomaly between the decision regarding online gaming taken in the 50th Council meeting and the ban
on online gaming imposed by the State. The Chairperson stated that the Revenue Secretary had already
clarified that the decision would not result in any anomaly. The advice from the Additional Solicitor
General (ASG) was sought and it indicated that there would be no conflict.
3.71 To address apprehension of Tamil Nadu about the decision being perceived as legalizing online
gaming in State of Tamil Nadu where it is banned, the Secretary proposed providing for a provision in
the proposed amendments to clarify that the provisions of the amendments do not prejudice any other
law and do not intend to legalize any activity that is banned under other laws. The draft of this proposed
clarificatory provision could be shared with the State.
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3.72 The Member from Tamil Nadu thanked the Council for considering their request and agreed to
the proposal for the draft provision to be sent to them.
3.73 The Member from Kerala also raised a similar issue regarding the ban on such activities in their
State and expressed satisfaction with the proposal given by the Secretary.
3.74 The Chairperson reiterated that the Council had consulted the ASG to ensure that the proposed
amendments would not lead to the liberalization of such activities in States where these are banned. She
also mentioned that a clarificatory provision would be formulated and shared with the State of
Tamil Nadu.
3.75 The Hon’ble Representative of Goa put his dissent to the decision and requested not to call it
unanimous decision. He reiterated his suggestion to work out a mechanism where the decision taken
could align with the law in a way it did not affect the States and the Industry or to review the present
decision taken in three months.
3.76 The Hon’ble Member from Delhi also requested to not call the decision ‘unanimous’ as they
had strong reservations.
3.77 The Hon’ble Member from Sikkim agreed with the points raised by Goa and emphasized to
maintain the federal structure of the country in any decision-making process.
3.78 The Secretary informed that all the States except the State of Goa, Sikkim, Delhi and Punjab
were in agreement with the proposed amendments.
3.79 The Chairperson expressed her gratitude to all the Members for attending the meeting, which
focused on implementing the decision taken during the 50th Council Meeting to amend the law
accordingly. She acknowledged the importance of this issue for some States and respected their views.
The present meeting was convened to facilitate the implementation of that decision and the inputs of all
Members were taken into consideration for making any necessary adjustments to the proposed
amendments. She also stated the inputs given by Kerala for which other States have also agreed.
She assured the Council that any decision not taken unanimously would be recorded with the
name of the State expressing dissent. She also mentioned that a previous decision regarding lottery was
similarly recorded when it was not unanimous. She emphasized the significance of the Council's
decision-making process which is a constitutional body and cautioned against undermining it by
repeatedly referring decisions back to the Group of Ministers or the Council itself for reconsideration,
which come back again within a short span of time to take a decision already taken forward for
implementation. The Chairperson reiterated that the Council respected every view presented by the
Members and either clarified or agreed or responded to them. She highlighted that the Council had
previously postponed decisions when necessary in the interest of States and this decision had taken
three years to reach finality.
She reassured that a review could be conducted after six months of implementation, if needed.
Responding to the suggestion from the Hon'ble Member from Goa to review it in three months, she
clarified that such a timeline would be too short to get sufficient experience for drawing any definitive
conclusion.
She then assured that after the six months of its implementation, the Council will table it and
review the statistics and the wisdom of the Council will prevail. She sought the cooperation of the
Members of GST Council to implement the proposed amendment from 01.10.2023.
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Decision: The Council agreed to amendments in the CGST Act 2017, IGST Act 2017 and
CGST Rules 2017 (along with modifications in proposed rules presented before the Council and
detailed in the presentation) and issuance of notification under section 15(5) of CGST Act 2017
and amendment in Notification No. 66/2017-CT dated 15.11.2017.
A clarificatory provision would be formulated in consultation with State of Tamil Nadu to the
effect that this amendment would not amount to legalizing online gaming, etc which had been
banned in Tamil Nadu and included in the amendment bill.
NIPFP will be asked to support the state of Bihar in assessing the revenue potential in the state.
In the end, the Secretary thanked the Hon’ble Chairperson, the Hon’ble MoS (Finance), the
Hon’ble Members and all the officers for attending the 51st GST Council Meeting.


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Annexure-1
List of Hon'ble Members/Ministers from the State attending the 51st Meeting of the GST Council held
on 02.08.2023
S. No. Name of States
Name of Hon'ble
Ministers/Member of GST
Council
Designation
1 GOI Smt. Nirmala Sitharaman Union Finance Minister
2 GOI Shri Pankaj Chaudhary Minister of State for Finance
3 Andhra Pradesh Shri Buggana Rajendranath
Minister for Finance, Planning,
Legislative Affairs, Commercial
Taxes and Skill Development &
Training
4 Arunachal Pradesh Shri Chowna Mein
Hon'ble Deputy Chief Minister-cum-
Finance Minister
5 Assam Smt. Ajanta Neog Finance Minister
6 Bihar Shri Vijay Kumar Chaudhary Minister for Commercial Tax
7 Chhattisgarh Shri T.S.Singh Deo Deputy Chief Minister
8 Delhi Smt. Atishi Marlena Finance Minister
9 Goa Dr. Pramod Sawant Chief Minister
10 Goa Shri Mauvin Godinho
Minister for Industries, Transport,
Panchayati Raj, Protocol and
Legislative Affairs
11 Gujarat Shri Kanubhai Desai Minister for Finance
12 Haryana Shri Dushyant Chautala
Deputy CM and Excise & Taxation
Minister
13 Himachal Pradesh Shri Harshwardhan Chauhan Industries Minister
14
Jammu and
Kashmir
Shri Rajeev Rai Bhatnagar
Advisor to Hon'ble Lieutenant
Governor, UT of J&K
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15 Karnataka Shri Krishna Byre Gowda Minister for Revenue Department
16 Kerala Shri K. N. Balagopal Finance Minister
17 Maharashtra Shri Ajit Pawar
Deputy Chief Minister, Minister for
Finance
18 Manipur Dr. Sapam Ranjan Singh
Minister for Medical, Health &
Family Welfare Department and
Publicity & Information Department
19 Meghalaya Shri Conrad K. Sangma Chief Minister
20 Mizoram Shri. Lalchamliana Taxation Minister
21 Nagaland Shri K.G Kenye
Minister for Power and Parliament
Affairs
22 Odisha Shri Bikram Keshari Arukha Minister for Finance
23 Punjab Shri Harpal Singh Cheema Finance Minister
24 Puducherry Shri K. Lakshminarayanan Minister for Public Works
25 Rajasthan Shri B.D.Kalla
Minister, Department of Education
(Primary and Secondary Education),
Department of Sanskrit Education,
Department of Art, Literature,
Culture and Archeology,
Independent charge of the
Department of Primary Education
under Panchayati Raj
26 Sikkim Shri B. S. Panth
Minister of Tourism & Civil
Aviation/Commerce &
Industries/Information & Public
Relations/Printing and Stationery
Department
27 Tamil Nadu Shri Thangam Thennarasu
Minister for Finance and Human
Resources Management
28 Telangana Shri T. Harish Rao
Minister for Finance, Health,
Medical & Family Welfare
29 Uttar Pradesh Shri Suresh Kumar Khanna
Minister of Finance, Parliamentary
Affairs
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30 Uttarakhand Shri Premchand Aggarwal
Minister of Finance, Urban
Development, Housing, Legislative
and Parliamentary Affairs,
Reorganisation and Census
31 West Bengal Smt. Chandrima Bhattacharya Minister of State for Finance


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Annexure-2
Attendance of officers from the Centre and the States/UTs attending the 51st Meeting of the GST
Council held on 02.08.2023
S.No.
Name of
State/CBIC/GSTC/GOI/
GSTN/DoR/TRU/POLICY
WING
Guest's Name Designation
1 DoR Shri Sanjay Malhotra Revenue Secretary
2 CBIC Shri Sanjay Kumar Agarwal
Member(Compliance
Management)
3 CBIC Shri Shashank Priya Member (GST)
4 CBIC Shri Vivek Ranjan Member (Tax Policy)
5 CBIC Shri Pankaj Kumar Singh
Additional Secretary (GST
Council Secretariat)
6 GST POLICY WING Shri Sanjay Mangal Principal Commissioner
7 GSTN Shri Manish Kumar Sinha CEO
8 GSTN Shri Dheeraj Rastogi EVP
9 TRU Ms. Limatula Yaden Joint Secretrary
10 GST Council Secretariat Ms. Ashima Bansal Joint Secretary
11 GST Council Secretariat Ms. B.Sumidaa Devi Joint Secretary
12 DoR Dr. N Gandhi Kumar Director (State Taxes)
13 GST POLICY WING Shri Alok Kumar Additional Commissioner
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14 GST POLICY WING Shri Raghavendra Pal Singh Additional Commissioner
15 GST POLICY WING Dr. Gurbaz Sandhu Additional Commissioner
16 TRU Shri Pramod Kumar OSD Commissioner in-situ
17 TRU Ms. Puneeta Bedi OSD
18 TRU Shri Satvik Dev OSD
19 Government of India Shri S.S. Nakul, IAS PS to FM
20 Government of India
Shri Sonam Karma Z
Lhasungpa
Additional PS to FM
21 Government of India Shri Sernya Bhutia 1ST PA TO FM
22 Government of India Shri Kumar Ravikant Singh PS to MoS Finance
23 DoR Shri Deepak Kapoor OSD to Revenue Secretary
24 GST POLICY WING Shri Amit Samdariya Deputy Commissioner
25 GST POLICY WING Ms. Neha Yadav Deputy Commissioner
26 GST POLICY WING Ms. Soumya Deputy Commissioner
27 TRU Ms. Anna Sosa Thomas Technical Officer
28 CBIC Shri Rushikesh Kodgi Dy. Controller of Accounts
29 PIB Dr. Pragya Paliwal Gaur Additional Director General
30 PIB Shri Kush Mohan Nahar Media & Communication Officer
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31 GST Council Secretariat Shri Kshitendra Verma Director
32 GST Council Secretariat Shri S.S.Shardool Director
33 GST Council Secretariat Shri Joginder Singh Mor Under Secretary
34 GST Council Secretariat Ms. Reshma R. Kurup Under Secretary
35 GST Council Secretariat Ms. Priya Sethi Superintendent
36 GST Council Secretariat Shri Dharambir Superintendent
37 GST Council Secretariat Shri Irfan Zakir Superintendent
38 GST Council Secretariat Shri Naveen Kumar Superintendent
39 GST Council Secretariat Shri Sachin Goel Superintendent
40 GST Council Secretariat Ms. Ambika Rani Superintendent
41 GST Council Secretariat Shri Niranjan Kishore Superintendent
42 GST Council Secretariat Shri Rakesh Joshi Superintendent
43 GST Council Secretariat Shri Vijay Malik Inspector
44 GST Council Secretariat Shri Padam Singh Inspector
45 GST Council Secretariat Shri Ashwani Sharma Inspector
46 GST Council Secretariat Shri Rohit Sharma Inspector
47 GST Council Secretariat Shri Karan Arora Inspector
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48 GST Council Secretariat Shri Tarun Inspector
49 GST Council Secretariat Shri Pankaj Dhaka Tax Assistant
50 GST Council Secretariat Shri Paresh Garg Tax Assistant
51 GST Council Secretariat Shri Shyam Bihari Meena Tax Assistant
52 Andhra Pradesh Shri N. Gulzar Secretary Finance(CT)
53 Andhra Pradesh Shri M. Girija Sankar Chief Commissioner(ST)
54 Andhra Pradesh Shri K. Ravi Sankar Commissioner(ST) Policy
55 Arunachal Pradesh Shri Lobsang Tsering Commissioner (Tax & Excise)
56 Arunachal Pradesh Shri Tapas Dutta
Deputy Commissioner-cum-
SNO (GST)
57 Arunachal Pradesh Shri Nakut Padung ST (GST Cell)
58 Assam Shri Samir K. Sinha Principal Secretary, Finance
59 Assam Shri Jayant Narlikar
Commissioner & Secretary.
Finance
60 Assam Shri Rakesh Agarwalla
Principal Commissioner of State
Tax
61 Assam Md. Shakeel Saadullah
Special Commissioner of State
Tax
62 Bihar Dr. Pratima
Commissioner cum Secretary
Commercial Taxes
63 Bihar Shri Sanjay Kumar Mawandia Audit Expert Commercial Taxes
64 Bihar Shri Krishna Kumar
Joint Secretary, Commercial
Taxes
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65 Bihar Shri Binod Kumar Jha
Additional Commissioner State
Tax
66 Chandigarh Shri Vinay Pratap Singh
Deputy Commissioner-cum-
Excise and Taxation
Commissioner
67 Chandigarh Shri Alok Passi
Assistant Excise and Taxation
Commissioner
68 Chhattisgarh Shri Himshikhar Gupta
Secretary, Commercial Tax
(State Tax)
69 Chhattisgarh Shri Ritesh Kumar Agrawal Commissionerof State Tax
70 Delhi Shri A Anbarasu
Principal Commissioner (State
Tax)
71 Delhi Shri Awanish Kumar
Special Commissioner (State
Tax)
72 Delhi Shri Lekh Raj
Additional Commissioner (Sate
Tax)
73 Delhi Shri Atish Kumar Joint Commissioner (Sate Tax)
74 Goa Shri S.S.Gill Commissioner of State Tax
75 Goa ShriVishant S.N.Gaunekar
Additional Commissioner of
State Tax
76 Goa Shri.Chandresh C.Kunkalkar
Additional Commissioner of
State Tax
77 Gujarat Shri J.P. Gupta
Additional Chief Secretary,
Finance Department
78 Gujarat Ms. Arti Kanwar
Secretary (Economic Affairs),
Finance Department
79 Gujarat Shri Samir Vakil
Chief Commissioner of State Tax
(I/c)
80 Gujarat Shri Dilip Thaker Joint Secretary (Tax)
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81 Gujarat Shri Riddhesh Raval Joint Commissioner of State Tax
82 Haryana Shri Devinder Singh Kalyan
Principal Secretary to
Government Haryana, Excise and
Taxation Department.
83 Haryana Shri Ashok Kumar Meena
Excise & Taxation
Commissioner-cum-Secretary to
Government
84 Haryana Shri Siddharth Jain
Additional Commissioner, GST,
Excise and taxation Department
85 Himachal Pradesh Shri Bharat Khera Principal Secretary (ST&E)
86 Himachal Pradesh Shri Yunus
Commissioner State Taxes and
Excise
87 Himachal Pradesh Shri Rakesh Sharma
Additional Commissioner State
Taxes and Excise
88 Jammu and Kashmir Shri Santosh D. Vaidya
Principal Secretary, Finance
Department
89 Jammu and Kashmir Dr. Rashmi Singh Commissioner, State Taxes
90 Jharkhand Ms. Vipra Bhal Secretary, Commercial Taxes
91 Jharkhand Shri Santosh Kumar Vatsa
Commissioner, Commercial
Taxes
92 Jharkhand Shri Brajesh Kumar
Assistant Commissioner of State
Taxes
93 Karnataka Ms. C. Shikha Commissioner Commercial Tax
94 Karnataka Dr. Ravi Prasad Additional Commissioner CT
95 Kerala Shri Ajit Patil
Commissioner, State GST
Department
96 Kerala Shri Abraham Renn S Additional Commissioner-1
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97 Madhya Pradesh Smt. Deepali Rastogi
Principal Secretary, Commercial
Tax Department
98 Madhya Pradesh Shri Lokesh Kumar Jatav Commissioner, Commercial Tax
99 Madhya Pradesh Shri Manoj Kumar Choubey
Additional Commissioner,
Commercial Tax
100 Madhya Pradesh Shri Harish Jain Commercial Tax Officer
101 Maharashtra Shri Nitin Kareer
Additional Chief Secretary
(Finance)
102 Maharashtra Ms Shaila A
Principal Secretary (Financial
Reforms)
103 Maharashtra Shri Rajeev Mital Commissioner of State Tax
104 Maharashtra Shri Kiran Nandedkar Joint Commissioner, HQ-5
105 Maharashtra
Shri Manoj Kumar
Narayanwal
Deputy Commissioner
106 Maharashtra Shri Babasaheb Gore OSD
107 Manipur Ms. Mercina R. Panmei Commissioner of Taxes
108 Manipur Shri Y. Indrakumar Singh Assistant Commissioner of Taxes
109 Meghalaya Shri Ramakrishna Chitturi Commissioner of Taxes
110 Meghalaya Shri L Khongsit
Additional Commissioner of
Taxes
111 Meghalaya Shri V R Challam Deputy Commissioner of Taxes
112 Meghalaya Shri. P.S. Lyngdoh Assistant Commissioner of Taxes
113 Mizoram Shri Vanlal Chhuanga
Principal Secretary, Taxation
Department
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114 Mizoram Shri H. Lianzela Secretary, Taxation Department
115 Mizoram Shri R. Zosiamliana Commissioner of State Tax
116 Mizoram Shri . C. Vanlalchhuana Commissioner of State Tax
117 Mizoram Shri Hrangthanmawia
Assistant Commissioner of State
Taxes
118 Mizoram Shri. K.H. Thanchhunga State Tax Officer
119 Mizoram
Smt. Jennifer Lallawmpuii
Pachuau
State Tax Officer
120 Nagaland Shri Wochamo Odyuo
Additional Commissioner of
State Taxes
121 Odisha Shri Vishal Kumar Dev Principal Secretary, Finance
122 Odisha Shri Sanjay Kumar Singh
Commissioner of Commercial
Taxes & GST
123 Punjab Shri Vikas Partap
Financial Commissioner
(Taxation)
124 Punjab Shri Kamal Kishor Yadav Commissioner of State Tax
125 Punjab Shri Ravneet Khurana
Additional Commissioner of
State Taxes (Audit)
126 Puducherry Shri L. Mohamed Mansoor Commissioner of State Tax
127 Rajasthan Dr Ravi Kumar Surpur Chief Commissioner, State Tax
128 Rajasthan Shri Mahesh Kumar Gowla
Special Commissioner (GST),
State Tax
129 Rajasthan Shri Arvind Mishra Advisor, State Tax
130 Sikkim Shri Manoj Rai
Commissioner (Commercial
Taxes)
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131 Tamil Nadu Shri T.Udhayachandran Principal Secretary, Finance
132 Tamil Nadu Shri Dheeraj Kumar
Principal
Secretary/Commissioner of
Commercial Taxes
133 Tamil Nadu Ms. B. Jothi Nirmalasamy
Secretary, Commercial Taxes and
Registration
134 Telangana Smt. Santhi Kumari
Chief Secretary and Special
Chief Secretary (CT & Excise)
135 Telangana Shri K Ramakrishna Rao Special Chief Secretary Finance
136 Telangana Shri N Sai Kishore
Additional Commissioner State
Tax
137 Telangana Ms. K Rupa Sowmya Deputy Commissioner State Tax
138 Tripura Ms. Rakhi Biswas Chief Commissioner of State Tax
139 Tripura Shri Ashin Barman GST Nodal Officer
140 Uttarakhand Dr. Ahmad Iqbal Commissioner of State Tax
141 Uttarakhand Shri Anil Singh Additional Commissioner
142 Uttarakhand Shri Amit Gupta Additional Commissioner
143 Uttarakhand Shri Anurag Mishra Joint Commissioner
144 Uttarakhand Shrji Ranjit Singh Assistant Commissioner
145 Uttar Pradesh Shri Nitin Ramesh Gokarn
Additional Chief Secretary, State
Tax
146 Uttar Pradesh Ms. Ministhy S Commissioner, State Tax
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147 Uttar Pradesh Shri Harilal Prajapati Joint Commissioner(GST)
148 Uttar Pradesh Shri Paritosh Kumar Mishra Deputy Commissioner, State Tax
149 Uttar Pradesh Shri Amit Pandey PA to Honourable Minister
150 West Bengal Dr. Manoj Pant
Additional Chief Secretary,
Finance Department
151 West Bengal Shri Khalid Aizaz Anwar Commissioner of State Tax
152 West Bengal Shri Rajib Sankar Sengupta
Senior Joint Commissioner of
Revenue
153 West Bengal Shri Joyjit Banik
Senior Joint Commissioner of
Revenue

















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Agenda Item 2: Ratification of the Notifications, Circulars and Orders issued by the GST Council
and decisions of GST Implementation Committee for the information of the Council.
In the 22nd meeting of the GST Council held at New Delhi on 6th October, 2017, it was decided
that the notifications, circulars and orders, which are being issued by the Central Government with the
approval of the competent authority, shall be forwarded to the GST Council Secretariat, through email,
for information and deemed ratification by the GST Council. Accordingly, in the 51st meeting held on
2nd August, 2023, the GST Council had ratified all the notifications, circulars, and orders issued up
to 26.07.2023.

2. In this respect, the following notifications and circulars issued after 26.07.2023 till
29.09.2023 under the GST laws by the Central Government, as available on www.cbic.gov.in, are
placed before the Council for information and ratification: -
Act/Rules Type Notification / Circular /
Order Nos.
Description/Subject
Notifications
under CGST
Act / CGST
Rules






















Central
Tax
1. Notification No.
27/2023-Central Tax
dated 31.07.2023
Seeks to notify the provisions of section
123 of the Finance Act, 2021 (13 of
2021).
2. Notification No.
28/2023-Central Tax
dated 31.07.2023
Seeks to notify the provisions of
sections 137 to 162 of the Finance Act,
2023 (8 of 2023).
3. Notification No.
29/2023-Central Tax
dated 31.07.2023
Seeks to notify special procedure to be
followed by a registered person
pursuant to the directions of the
Hon’ble Supreme Court in the case of
Union of India v/s Filco Trade Centre
Pvt. Ltd., SLP(C) No.32709-
32710/2018.
4. Notification No.
30/2023-Central Tax
dated 31.07.2023
Seeks to notify special procedure to be
followed by a registered person
engaged in manufacturing of certain
goods.
5. Notification No.
31/2023-Central Tax
dated 31.07.2023
Seeks to amend Notification No.
27/2022 dated 26.12.2022.
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6. Notification No.
32/2023-Central Tax
dated 31.07.2023
Seeks to exempt the registered person
whose aggregate turnover in the
financial year 2022-23 is up to two
crore rupees, from filing annual return
for the said financial year.
7. Notification No.
33/2023-Central Tax
dated 31.07.2023
Seeks to notify “Account Aggregator”
as the systems with which information
may be shared by the common portal
under section 158A of the CGST Act,
2017.
8. Notification No.
34/2023-Central Tax
dated 31.07.2023
Seeks to waive the requirement of
mandatory registration under section
24(ix) of CGST Act for person
supplying goods through ECOs, subject
to certain conditions.
9. Notification No.
36/2023-Central Tax
dated 04.08.2023
Seeks to notify special procedure to be
followed by the electronic commerce
operators in respect of supplies of
goods through them by composition
taxpayers.
10. Notification No.
37/2023-Central Tax
dated 04.08.2023
Seeks to notify special procedure to be
followed by the electronic commerce
operators in respect of supplies of
goods through them by unregistered
persons.
11. Notification No.
38/2023-Central Tax
dated 04.08.2023
Seeks to make amendments (Second
Amendment, 2023) to the CGST Rules,
2017.
12. Notification No.
39/2023-Central Tax
dated 17.08.2023
Seeks to amend Notification No.
02/2017-Central Tax dated 19.06.2017
13. Notification No.
41/2023-Central Tax
dated 25.08.2023
Seeks to extend the due date for
furnishing FORM GSTR-1 for April,
May, June and July, 2023 for registered
persons whose principal place of
business is in the State of Manipur
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14. Notification No.
42/2023-Central Tax
dated 25.08.2023
Seeks to extend the due date for
furnishing FORM GSTR-3B for April,
May, June and July, 2023 for registered
persons whose principal place of
business is in the State of Manipur
15. Notification No.
43/2023-Central Tax
dated 25.08.2023
Seeks to extend the due date for
furnishing FORM GSTR-3B for
quarter ending June, 2023 for registered
persons whose principal place of
business is in the State of Manipur
16. Notification No.
44/2023-Central Tax
dated 25.08.2023
Seeks to extend the due date for
furnishing FORM GSTR-7 for April,
May, June and July, 2023 for registered
persons whose principal place of
business is in the State of Manipur
17. Notification No.
45/2023-Central Tax
dated 06.09.2023
Seeks to make amendments (Third
Amendment, 2023) to the CGST Rules,
2017.
18. Notification No.
47/2023-Central Tax
dated 25.09.2023
Seeks to amend Notification No.
30/2023-CT dated 31st July, 2023
19. Notification No.
48/2023-Central Tax
dated 29.09.2023
Seeks to notify the provisions of the
Central Goods and Services Tax
(Amendment) Act, 2023
20. Notification No.
49/2023-Central Tax
dated 29.09.2023
Seeks to notify supply of online money
gaming, supply of online gaming other
than online money gaming and supply
of actionable claims in casinos under
section 15(5) of CGST Act
21. Notification No.
50/2023-Central Tax
dated 29.09.2023
Seeks to amend Notification No.
66/2017-Central Tax dated 15.11.2017
to exclude specified actionable claims
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22. Notification No.
51/2023-Central Tax
dated 29.09.2023
Seeks to make amendments (Third
Amendment, 2023) to the CGST Rules,
2017 in supersession of Notification
No. 45/2023 dated 06.09.2023
Central
Tax (Rate)
1. Notification No.
11/2023-Central Tax
(Rate), dated 29.09.2023
Seeks to amend Notification No
01/2017- Central Tax (Rate) dated
28.06.2017.







Notifications
under IGST
Act / IGST
Rules
Integrated
Tax
1. Notification No.
01/2023- Integrated Tax,
dated 31.07.2023
Seeks to notify all goods or services
which may be exported on payment of
integrated tax and on which the supplier
of such goods or services may claim the
refund of tax so paid.
2. Notification No.
02/2023- Integrated Tax,
dated 29.09.2023
Seeks to notify the provisions of the
Integrated Goods and Services Tax
(Amendment) Act, 2023
3. Notification No.
03/2023- Integrated Tax,
dated 29.09.2023
Seeks to notify the supply of online
money gaming as the supply of goods
on import of which, integrated tax shall
be levied and collected under sub-
section (1) of section 5 of the Integrated
Goods and Services Tax Act, 2017
4. Notification No.
04/2023- Integrated Tax,
dated 29.09.2023
Seeks to provide Simplified registration
Scheme for overseas supplier of online
money gaming
Integrated
Tax (Rate)
1. Notification No.
11/2023-Integrated Tax
(Rate), dated 26.09.2023
Seeks to amend notification No.
8/2017- Integrated Tax (Rate) dated
28.06.2017 to implement decisions of
the 50th GST Council.
2. Notification No.
12/2023- Integrated Tax
(Rate), dated 26.09.2023
Seeks to amend notification No.
09/2017- Integrated Tax (Rate) dated
28.06.2017 to implement decisions of
the 50th GST Council.
3. Notification No.
13/2023- Integrated Tax
(Rate), dated 26.09.2023
Seeks to amend notification No.
10/2017- Integrated Tax (Rate) dated
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28.06.2017 to implement decisions of
the 50th GST Council.
4. Notification No.
14/2023- Integrated Tax
(Rate), dated 29.09.2023
Seeks to amend Notification No
01/2017- Integrated Tax (Rate) dated
28.06.2017.
Notifications
under UTGST
Act / UTGST
Rules
Union
Territory
Tax (Rate)
1. Notification No.
11/2023- Union Territory
Tax (Rate), dated
29.09.2023
Seeks to amend Notification No
01/2017- Union territory Tax (Rate)
dated 28.06.2017.
Circulars under CGST Act
1. Circular No.
200/12/2023-GST dated
01.08.2023
Clarification regarding GST rates and
classification of certain goods based on
the recommendations of the GST
Council in its 50th meeting held on
11th July, 2023
2. Circular No.
201/13/2023-GST dated
01.08.2023
Clarifications regarding applicability
of GST on certain services


3. It is mentioned that some of the notifications referred in Para 2 above have been issued as per
the recommendations of GST Implementation Committee (GIC). The details of such decisions and the
relevant Notifications and Circulars issued to implement such decisions are enclosed as Annexure “2A”
to this Agenda Note.

4. The GST Council may grant ratification to the notifications and circulars as detailed in para 2
above.



*****
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Annexure- 2A

Decisions of GST Implementation Committee (GIC) for information of the GST Council.
The GST implementation Committee took certain decisions after the 51st GST Council meeting. These
decisions are placed before the council for information. The details of the decisions taken are given
below:
1. Decision of GIC by circulation on 25th August,2023 in respect of extension of due dates in filing
of GSTR-1,GSTR-3B and GSTR-7 till 25th August, 2023 in the State of Manipur due to
breakdown of internet services in the state
a. In the agenda note received from Department of Revenue, it was stated that a request had been
received from Manipur that due to volatile law and order situation in the State, mobile data services and
internet/ data services were under suspension due to which timely filing of returns in GSTR-1, GSTR
3B and GSTR 7 for the month of April 2023, May 2023, June 2023 and July, 2023 by registered persons
in Manipur was not possible in the State. Accordingly, it was requested to extend the due dates of
filing FORM GSTR-1, GSTR-7 and GSTR-3B for the month of April, May, June and July, 2023 till
25.08.2023.
b. The agenda note further brought to notice that in view of the prevailing law and order situation in
the State of Manipur, the due dates of filing FORM GSTR-1, GSTR-7 and GSTR-3B for the months of
April, May and June 2023 for the registered persons of State of Manipur had been extended earlier as
below:
(i) due dates of filing FORM GSTR-1, GSTR-7 and GSTR-3B for April, 2023 were first extended until
31.05.2023 vide notifications dated 24.05.2023;
(ii) due dates of filing FORM GSTR-1, GSTR-7 and GSTR-3B for April and May, 2023 were thereafter
extended until 30.06.2023 vide notifications dated 19.06.2023;
(iii) due dates of filing FORM GSTR-1, GSTR-7 and GSTR-3B for April, May and June, 2023 were
thereafter extended until 31.07.2023 vide notifications dated 17.07.2023;
Accordingly, approval of GIC was sought for extending the timelines as stated above.
c. Decision : The members of GIC approved the above proposal to extend the extend the due dates of
filing FORM GSTR-1, GSTR-7 and GSTR-3B for the months of April 2023, May 2023, June 2023 and
July, 2023 till 25.08.2023.
d. Implementation Status: In pursuance of the GIC dated 25.08.2023, the Notification No 41/2023-
Central Tax dated 25.08.2023, Notification No 42/2023-Central Tax dated 25.08.2023, Notification No
43/2023-Central Tax dated 25.08.2023, Notification No 44/2023-Central Tax dated 25.08.2023 were
issued to extend the due dates of filing FORM GSTR-1, GSTR-7 and GSTR-3B for the month of April,
May, June and July, 2023 till 25.08.2023 in the State of Manipur.

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2. Decision of GIC by circulation on 23rd September, 2023 on data sharing request by
Government of Tamil Nadu
a. In the agenda note received from Department of Revenue, it was mentioned that Government
of Tamil Nadu (Commissionerate of Textiles) was making suitable policies for development of the
Textile Industry in respect of Textile sectors such as Ginning / Spinning /Warping/Sizing/
Weaving/Knitting/ Processing/ Garmenting/ Composite Units/ Technical Textiles/Textile Machinery
Manufacturing/Textile Accessories Manufacturing/ Textile Dyes and Chemical Manufacturing for
which aggregated GST data was a critical input.
b. The format in which the data is required by is as below:
1 Centre/State Government State Government, Tamil Nadu
2 Ministry/ Department Handlooms, Handicrafts, Khadi and Textiles
HOD details; - Commissioner of Textiles
(Department of Textiles, Tamil Nadu)
3 !Name of Agency Commissionerate of Textiles, Chennai
4 Data items on which aggregation
needs to be done



As per Format given below
5 Data items of which aggregates are
required
6 Period for which data is to be
aggregated
Aggregated data on the Financial Year
7 Whether one time or recurring Recurring on every Financial Year
8 Periodicity if recurring Periodically required based on Financial Years
9 Purpose for which data is being
sought
Proposes to release New Textile Policy and various
new schemes by the Hon'ble Chief Minister of Tamil
Nadu for the betterment of the Textile
Industry
10 Details of Contact Person a. Name - V.K. Ananda Kumar
b. Designation - Deputy Director (Admin and
Spinning)
c. Phone no. 044-45020047, Extn no. 112
d. e-mail - statisticaldata23@gmail.com,
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c. It was stated in the agenda note that the GST Council in its 48th meeting has already approved the
policy of GST data sharing with other Ministries/Departments wherein it was agreed that any agency
that intends to access summary data pertaining to GST should give the details in approved format to the
Department of Revenue for further processing and to pl ace it before the GST Implementation
Committee (GIC). Accordingly, approval of GIC was sought for sharing of GST data with
Commissionerate of Textiles, Government of Tamil Nadu.
d. Decision : The members of GIC approved the above proposal regarding sharing of GST data with
Commissionerate of Textiles, Government of Tamil Nadu.
3. Decision of GIC by circulation on 23rd September, 2023 in respect of extension of time for
implementation of Notification no. 30/2023 Central Tax dated 31/07/2023
a. In the agenda note received from Department of Revenue it was mentioned that based on the
recommendations of the GST Council in its 50th meeting, Central Government had notified the special
procedure vide Notification No 30/2023 Central Tax dated 31.07.2023 to be followed by the registered
persons of the goods mentioned in the schedule to the said notification, including pan masala, chewing
tobacco, gutkha, etc. The said special procedure envisages submission of the monthly statement (SRM-
IV) and various other details by the concerned registered taxpayer through online mode for which
various Forms such as SRM –I, SRM-IA, SRM-II A, SRM-IIB, etc need to be made available on
online portal. Such online FORMS were not available on the portal at this juncture.
b. The agenda note further mentioned that representations had been received from various trade
associations and industry representatives requesting for postponement/ extension of time limit for
implementation of said special procedure notified vide Notification No 30/2023 Central Tax dated
31.07.2023, due to the unavailability of said FORMs on the portal and also considering numerous other
practical challenges faced by the industry such as unavailability of model number/manufacturer of old
and used packing machines and time required to obtain the said information, segregation of
consumption of electricity between that used for manufacturing of specified goods and that used for
other purposes, measurement of waste on daily basis, need for clarification about various issues
pertaining to implementation of special procedure, etc.
c. The agenda note mentioned that the status of development of functionality for the said forms on
the portal had been checked from GSTN. It was gathered from GSTN that significant time is needed to
develop the online facility for the said forms as per the said special procedure. It may be recalled that
GoM of Capacity Based Taxation had recommended that these special procedures may be implemented
through system based measures without requiring manual interface.
d. The agenda note further stated that the above mentioned difficulties were deliberated by the
Law Committee in its meeting dated 31.08.2023/01.09.2023 and the Law Committee recommended
that the implementation of the scheme may be deferred to 1st January 2024 since no functionality has
yet been made available on the portal. In the meantime, GSTN, in coordination with the state of Uttar
Pradesh, shall develop the said online functionality and make all efforts to make it available by 31st
Dec, 2023, so that the scheme can be implemented from 1st January, 2024. Further, the Law Committee
has also recommended for examination of the issues being raised by the trade in various representations
by a sub-committee headed by the state of Uttar Pradesh and including Odisha, Madhya Pradesh, GSTN
and GST Policy Wing, which will give its recommendations to the Law Committee within one month.
e. Accordingly, it was proposed in the agenda note that in the meantime, as discussed above, the
implementation of the scheme may be deferred to 01.01.2024, by issuing a notification (to be effective
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from 31.07.2023) specifying 01.01.2024 as the date on which the provisions of Notification No.
30/2023 Central Tax dated 31.07.2023 shall come into effect. The said proposal was placed before the
GIC for deliberation and approval.
f. Decision : The members of GIC approved the above proposal to defer implementation of the
scheme by issuing a notification (to be effective from 31.07.2023) specifying 1st January 2024 as the
date on which the provisions of Notification No. 30/2023 Central Tax dated 31.07.2023 shall come into
effect.
g. Implementation Status: In pursuance of the GIC decision dated 23.09.2023, the Notification No.
47/2023- Central Tax dated 25.09.2023 was issued to defer implementation of the scheme specifying
1st January 2024 as the date on which the provisions of Notification No. 30/2023 Central Tax dated
31.07.2023 shall come into effect.

4. Decision of GIC by circulation on 22nd September, 2023 in respect of amendments in
CGST Rules, 2017 and issuance of notifications post Central Goods and Services Tax
(Amendment) Act, 2023 and The Integrated Goods and Services Tax (Amendment) Act, 2023
pertaining to overseas supplier of online money gaming
a. In the agenda note received from Department of Revenue it was mentioned that the GST
Council in its 51st meeting held on 02.08.2023 recommended certain amendments in the CGST Act
2017 and IGST Act 2017, to provide clarity on the taxation of supplies in casinos, horse racing and
online gaming. It was also recommended by the Council that amendments in CGST Act and IGST Act
may be done at the earliest by the Centre and the States, so that these amendments may be brought into
effect from 01.10.2023. The Central Goods and Services Tax (Amendment) Act, 2023 and The
Integrated Goods and Services Tax (Amendment) Act, 2023 have been passed by the Parliament as per
the recommendations made by the GST Council in its 51st meeting. Further, the Council in its 51st
meeting had also recommended issuance of certain notifications and insertion of rule 31B & 31C in
CGST Rules, 2017.
b. The agenda note further stated that certain consequential amendments are further required in
CGST Rules, 2017 and FORMS in respect of a person supplying online money gaming from a place
outside India to a person in India. Further, notification under the amended proviso to section 5(1) of
IGST Act will be required to be issued to exclude the supply of online money gaming from the said
proviso. Also, Simplified Registration Scheme as per new section 14A of IGST Act (read with section
14 of IGST Act) will be required to be notified in respect of a person supplying online money gaming
from a place outside India to a person in India. Accordingly, Law Committee deliberated on the
aforementioned issues in its meeting held on 31.08.2023 and 01.09.2023 and recommended the
following amendments in CGST Rules, FORMS and issuance of certain notifications as below:
A. Amendment in CGST Rules, 2017:
1. Amendment in rule 8(1)
Rule 8. Application for registration. –
(1) Every person, other than a non-resident taxable person, a person required to deduct tax at
source under section 51 , a person required to collect tax at source under section 52, a person
supplying online money gaming from a place outside India to a person in India as referred in
Agenda for 52nd GSTCM Volume 1
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section 14A of the Integrated Goods and Services Tax Act, 2017 (13 of 2017) and a person
supplying online information and database access or retrieval services from a place outside
India to a non-taxable online recipient referred to in section 14 of the Integrated Goods and
Services Tax Act, 2017 (13 of 2017) who is liable to be registered under sub-section (1)
of section 25 and every person seeking registration under sub-section (3) of section
25 (hereafter in this Chapter referred to as "the applicant") shall, before applying for
registration, declare his Permanent Account Number, State or Union territory in Part
A of FORM GST REG-01 on the common portal, either directly or through a Facilitation
Centre notified by the Commissioner:
Provided that every person being an Input Service Distributor shall make a separate application
for registration as such Input Service Distributor.
2. Amendment in rule 14(1)
Rule 14. Grant of registration to a person supplying online information and database
access or retrieval services from a place outside India to a non-taxable online recipient or
to a person supplying online money gaming from a place outside India to a person in
India. -
(1) Any person supplying online information and database access or retrieval services from a
place outside India to a non-taxable online recipient or any person supplying online money
gaming from a place outside India to a person in India shall electronically submit an
application for registration, duly signed or verified through electronic verification code,
in FORM GST REG-10 , at the common portal, either directly or through a Facilitation Centre
notified by the Commissioner.
3. Amendment in proviso to 46(f)

Provided that in cases involving supply of online money gaming or in cases where any taxable
service is supplied by or through an electronic commerce operator or by a supplier of online
information and database access or retrieval services, to a recipient who is un-registered,
irrespective of the value of such supply, a tax invoice issued by the registered person shall
contain the name of the State of the recipient and the same shall be deemed to be the address
on record of the recipient.

4. Amendment in rule 64

Rule 64. Form and manner of submission of return by persons providing online
information and data base access or retrieval services and by persons supplying online
money gaming from a place outside India to a person in India.-

Every registered person either providing online money gaming from a place outside India to a
person in India, or providing online information and data base access or retrieval services from
a place outside India to a non-taxable online recipient referred to in section 14 of the Integrated
Goods and Services Tax Act, 2017 (13 of 2017) or to a registered person other than a non-
taxable online recipient, shall file return in FORM GSTR-5A on or before the twentieth day of
the month succeeding the calendar month or part thereof.
Agenda for 52nd GSTCM Volume 1
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5. Amendment in proviso to sub-rule (3) of rule 87

Provided further that a person supplying online information and database access or retrieval
services from a place outside India to a non-taxable online recipient referred to in section 14 of
the Integrated Goods and Services Tax Act, 2017 (13 of 2017) or a person supplying online
money gaming from a place outside India to a person in India as referred to in section 14A of
the Integrated Goods and Services Tax Act, 2017 (13 of 2017) may also make the deposit
under sub-rule (2) through international money transfer through Society for Worldwide Inter
bank Financial Telecommunication payment network, from the date to be notified by the Board


B. Amendments in FORMS
FORM GST REG-10
[See rule 14(1)]



Application for registration of person supplying online money gaming from a place outside India to a
person in India or for registration of person supplying online information and database access or
retrieval services from a place outside India to a non-taxable online recipient person in India, other
than a registered person.
Part –A
(i) Legal name of the person
(ii) Tax identification number or unique number on the basis of which the entity
is identified by the Government of that country

(ii
a)
Type of supply (a) Supply of
online money
gaming
(b) Supply of
online
information
and database
access or
retrieval
services
(c) Both (a) and
(b) above
(iii) Name of the Authorised Signatory
Agenda for 52nd GSTCM Volume 1
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Part -B
1. Details of Authorised Signatory
First Name Middle Name Last Name
Photo


Gender Male / Female / Others
Designation
Date of Birth DD/MM/YYYY
Father’s Name
Nationality
Aadhaar, if any
Address of the Authorised Signatory
Address line 1



Address line 2
Address line 3
2.
Date of commencement of the online service
or online money gaming in India.
DD/MM/YYYY
(iv) Email Address of the Authorised Signatory
(v) Name of the representative appointed in India, if any
(a) Permanent Account Number of the representative in India
(b) Email Address of the representative in India
(c) Mobile Number of the representative in India (+91)
Note- Relevant information submitted above is subject to online verification, where practicable,
before proceeding to fill up Part-B.
Agenda for 52nd GSTCM Volume 1
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3



Uniform Resource Locators (URLs) of the website/ platform/ name of the application, etc, as
applicable through which online money gaming or online information and database access or
retrieval services taxable services are provided:
1.
2.
3…
4 Jurisdiction Center
Bengaluru West, CGST
Commissionerate
5
Details of Bank Account of representative in India(if appointed)
Account
Number

Type of account

Bank Name
Branch
Address

IFSC

6
Documents Uploaded
A customized list of documents required to be uploaded (refer Instruction) as per the field
values in the form
7
Declaration
I hereby solemnly affirm and declare that the information given herein above is true and
correct to the best of my knowledge and belief and nothing has been concealed therefrom.

I, _ …………………………. hereby declare that I am authorised to sign on behalf of the
Registrant. I would charge and collect tax liable from the non-taxable non-assesse online
recipient located in taxable territory (in case of online information and database access or
retrieval services) and/or from the recipient located in taxable territory (in case of online
money gaming) and deposit the same with Government of India. Signature
Place: Name of Authorised Signatory:
Date: Designation:
Note: Applicant will require to upload declaration (as per under mentioned format) along
with scanned copy of the passport and photograph.

List of documents to be uploaded as evidence are as follows:-
Agenda for 52nd GSTCM Volume 1
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1. Proof of Place of Business of representative in India, if any:
(a) For own premises –
Any document in support of the ownership of the premises like Latest Property Tax
Receipt or Municipal Khata copy or copy of Electricity Bill.
(b) For Rented or Leased premises –
A copy of the valid Rent / Lease Agreement with any document in support of the
ownership of the premises of the Lessor like Latest Property Tax Receipt or Municipal
Khata copy or copy of Electricity Bill.
(c) For premises not covered in (a) and (b) above –
A copy of the Consent Letter with any document in support of the ownership of the
premises of the Consenter like Municipal Khata copy or Electricity Bill copy. For shared
properties also, the same documents may be uploaded.
2. Proof of :
Scanned copy of the passport of the Non -resident tax payer with VISA details. In case of
Company/Society/LLP/FCNR/ etc. person who is holding power of attorney with
authorisation letter.
Scanned copy of Certificate of Incorporation if the Company is registered outside India or
in India
Scanned copy of License is issued by origin country
Scanned copy of Clearance certificate issued by Government of India
3 Bank Account Related Proof:
Scanned copy of the first page of Bank passbook / one page of Bank Statement
Opening page of the Bank Passbook held in the name of the Proprietor / Business
Concern – containing the Account No., Name of the Account Holder, MICR and IFSC
and Branch details.
4. Scanned copy of documents regarding appointment as representative in India, if
applicable
Agenda for 52nd GSTCM Volume 1
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5. Authorisation Form:-
For Authorised Signatory mentioned in the application form, Authorisation or copy of
Resolution of the Managing Committee or Board of Directors to be filed in the following
format:
Declaration for Authorised Signatory (Separate for each signatory)
I ---(Managing Director/Whole Time Director/CEO or Power of Attorney holder) hereby
solemnly affirm and declare that <<name of the authorised signatory>> to act as an
authorised signatory for the business << Name of the Business>> for which application
for registration is being filed/ is registered under the Central Goods and Service Tax Act,
2017.
All his actions in relation to this business will be binding on me/ us.
Signatures of the persons who is in charge.
S. No. Full Name Designation/Status Signature
1.
Acceptance as an authorised signatory
I <<(Name of authorised signatory>> hereby solemnly accord my acceptance to act as
authorised signatory for the above referred business and all my acts shall be binding on
the business.
Signature of Authorised Signatory Place
(Name)
Date: Designation/Status

Instructions –
1. If authorised signatory is not based in India, authentication through digital
signature certificate shall not be mandatory for such persons. The authentication
will be done through Electronic Verification Code (EVC).
2. Appointed representative in India shall have the meaning as specified under section
14 of Integrated Goods and Services Tax Act, 2017 or section 14A of Integrated
Goods and Services Tax Act, 2017, whichever applicable.




Agenda for 52nd GSTCM Volume 1
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FORM GSTR-5A
[See rule 64]
Details of supplies of online information and database access or retrieval services by a person
located outside India made to non-taxable online recipient (as defined in Integrated Goods and
Services Tax Act, 2017) and to registered persons in India and details of supplies of online
money gaming by a person located outside India to a person in India
1. GSTIN of the supplier-

2. (a) Legal name of the registered person -

(b) Trade name, if any -
3. Name of the Authorised representative in India filing the return –
4. Period: Month - ______ Year –
4(a) ARN:
4(b) Date of ARN:
5. Taxable outward supplies of online information and database access or retrieval services made to
non-taxable online recipient in India
(Amount in Rupees)

Place of supply (State/UT) Rate of tax Taxable value Integrated tax Cess
1 2 3 4 5


5A. Amendments to taxable outward supplies of online information and database access or retrieval
services to non-taxable online recipient in India
(Amount in Rupees)
Month Place of
supply
(State/UT)
Rate of tax Taxable value Integrated tax Cess
1 2 3 4 5 6
Agenda for 52nd GSTCM Volume 1
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5B. Taxable outward supplies of online information and database access or retrieval services made to
registered persons in India, other than non-taxable online recipient, on which tax is to be paid by the
said registered persons on reverse charge basis
(Amount in Rupees)

GSTIN Taxable Value
1 2




5C. Amendments to the taxable outward supplies of online information and database access or
retrieval services made to registered persons in India, other than non-taxable online recipient, on
which tax is to be paid by the said registered persons on reverse charge basis
(Amount in Rupees)







5D. Supplies of online money gaming made to a person in India
(Amount in Rupees)

Place of supply
(State/UT)
Rate of
tax
Taxable
value
Integrated
tax
Cess
1 2 3 4 5

Month Original
GSTIN
Revised GSTIN Taxable value
1 2 3 4


Agenda for 52nd GSTCM Volume 1
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5E. Amendments to supplies of online money gaming made to a person in India
(Amount in Rupees)

Month Place of
supply
(State/UT)
Rate of
tax
Taxable
value
Integrated
tax
Cess
1 2 3 4 5 6


6. Calculation of interest, or any other amount
(Amount in Rupees)
Sr.
No
Description Place of supply
(State/UT)
Amount due (Interest/ Other)
Integrated tax Cess
1 2 3 4 5
1. Interest
2. Others
Total

7. Tax, interest, and any other amount payable and paid
(Amount in Rupees)
Sr. No. Description Amount payable Debit
entry no.
Amount paid
Integrated Tax Cess Integrated Tax Cess
1 2 3 4 5 6 7
1. Tax Liability
(based on Table 5,
& 5A, 5D and 5E)

Agenda for 52nd GSTCM Volume 1
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2. Interest (based on
Table 6)

3. Others (based on
Table 6)


Verification
I hereby solemnly affirm and declare that the information given herein above is true and correct to the
best of my knowledge and belief and nothing has been concealed therefrom.


Signature

Place Name of Authorised Signatory

Date Designation /Status


Agenda for 52nd GSTCM Volume 1
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C. Issuance of notifications
1. Issuance of notification for notifying the supply of online money gaming as the supply of goods on
import of which, integrated tax shall be levied and collected not under the said proviso but shall be
levied and collected under sub-section (1) of section 5 of the Integrated Goods and Services Tax
Act,2017.

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II,
SECTION 3, SUB-SECTION (i)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

NOTIFICATION
No. XX/2023 – Integrated Tax

New Delhi, the XXthOctober, 2023

G.S.R. (E):— In exercise of powers conferred under proviso to sub-section (1) of section 5 of the
Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Government, on the recommendations
of the Council, notifies the supply of online money gaming as the supply of goods on import of which,
integrated tax shall be levied and collected not under the said proviso but shall be levied and collected
under sub-section (1) of section 5 of the Integrated Goods and Services Tax Act,2017.

2.This notification shall come into force on the XXstday of October, 2023.

[F. No. CBIC- 20021/1/2023-GST]
(Alok Kumar)
Director
2. Issuance of notification for providing for Simplified registration Scheme as per new section 14A of
IGST Act (read with section 14 of IGST Act) in respect of a person supplying online money gaming
from a place outside India to a person in India.

Agenda for 52nd GSTCM Volume 1
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[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II,
SECTION 3, SUB-SECTION (i)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

NOTIFICATION
No. XX/2023 – Integrated Tax

New Delhi, the XXthOctober, 2023

G.S.R . (E). -In exercise of the powers conferred by sub-section (2) of section 14A of the Integrated
Goods and Services Tax Act, 2017 (13 of 2017) (hereinafter referred to as the said Act) read with section
14 of the said Act and sub-rule (2) of rule 14 of the Central Goods and Services Tax Rules, 2017, the
Central Government hereby notifies the Principal Commissioner of Central Tax, Bengaluru West
and all the officers subordinate to him as the officers empowered to grant registration in case of
supply of online money gaming provided or agreed to be provided by a person located in non-
taxable territory and received by a person in India.

Explanation.-For the purposes of this notification, “online money gaming” shall have the same meaning
as assigned to it in clause (80B ) of section 2 of the Central Goods and Services Tax Act, 2017 (12 of
2017).

2. This notification shall come into force on the XXstday of October, 2023.


[F. No. CBIC- 20021/1/2023-GST]


(Alok Kumar)
Director
Agenda for 52nd GSTCM Volume 1
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c. The agenda note further mentioned that as the Council had recommended in 51st meeting that
amendments in CGST Act and IGST Act may be brought into effect from 01.10.2023, the above
mentioned amendments in CGST Rules, FORMs and issuance of notifications are required to be done
before 01.10.2023 as no meeting of GST Council was scheduled anytime soon. Accordingly, the agenda
is placed before the GIC for deliberation and approval.
d. Decision : The members of GIC approved the above proposal regarding amendments in CGST Rules,
2017 and issuance of notifications post Central Goods and Services Tax (Amendment) Act, 2023 and
The Integrated Goods and Services Tax (Amendment) Act, 2023 pertaining to overseas supplier of
online money gaming.
e. Implementation Status: In pursuance of the GIC decision dated 22.09.2023, the Notification No.
48/2023- Central Tax dated 29.09.2023, Notification No. 49/2023- Central Tax dated 29.09.2023,
Notification No. 50/2023- Central Tax dated 29.09.2023, Notification No. 51/2023- Central Tax dated
29.09.2023 and Notification No. 02/2023-Integrated Tax dated 29.09.2023, Notification No. 03/2023-
Integrated Tax dated 29.09.2023, Notification No. 04/2023- Integrated Tax dated 29.09.2023 were
issued.

5. Decision of GIC by circulation on 29th September, 2023 in respect of carrying out
amendments to notification No. 1/2017-CT (R) dated 28-06-2017 consequent to amendment of
CGST Act, 2017
a. In the Agenda note was received from Department of Revenue it was mentioned that the GST
Council in the 50th meeting had deliberated on the 2nd report of the Group of Ministers on Casinos,
Race Courses and Online Gaming and had recommended that the actionable claims supplied in casinos,
horse racing and online gaming may be taxed @ 28% on full face value irrespective of whether the
activities are a game of skill or chance and the law may be amended accordingly. Further, the GST
Council in the 51st meeting held on 2nd August, 2023 had recommended certain amendments in the
CGST Act, 2017 and IGST Act, 2017 so as to bring clarity in taxation of the actionable claims in
Casinos, Horse Racing and Online Gaming.
b. It was mentioned in the agenda note that the amendments to the CGST Act and IGST Act as
recommended by the Council had since been carried out. They are to come into force from a date to be
notified. One of the amendments carried out in CGST Act, 2017 is to substitute the words “lottery,
betting and gambling” in para 6 of Schedule III with the words “specified actionable
claims”. “Specified actionable claim” has been defined to mean actionable claim involved in or by way
of
i. betting; or
ii. casinos; or
iii. gambling; or
iv. horse racing; or
v. lottery; or
vi. online money gaming.
The agenda note further mentioned that consequential changes were required to be made to Sl. No. 228
of Schedule IV of notification No. 1/2017-CT (R) dated 28-06-2017 which prescribes GST rate of 28%
Agenda for 52nd GSTCM Volume 1
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on lottery and in Sl. No. 229 of Schedule IV which prescribes GST rate of 28% on actionable claim in
the form of chance to win in betting, gambling or horse racing in race club, in order to align these entries
with the amended para 6 of Schedule III of CGST Act, 2017.
c. The agenda note stated that since no GST Council was scheduled to be held in near future and
the changes are proposed to be implemented w.e.f 01.10.2023, approval of GIC was required for
amendment of notification No. 1/2017-CT (R) dated 28-06-2017 (and corresponding notifications under
IGST, UTGST and SGST Acts) so as to align Sl. No. 228 of Schedule IV of notification No. 1/2017-
CT (R) dated 28-06-2017 which prescribes GST rate of 28% on lottery and Sl. No. 229 of Schedule IV
which prescribes GST rate of 28% on actionable claim in the form of chance to win in betting, gambling
or horse racing in race club, with the amended para 6 of Schedule III of CGST Act, 2017. Accordingly,
the agenda is placed before the GIC for deliberation and approval.
d. Decision : The members of GIC approved the above proposal to amendment of notification No.
1/2017-CT (R) dated 28-06-2017 (and corresponding notifications under IGST, UTGST and SGST
Acts) so as to align Sl. No. 228 of Schedule IV of notification No. 1/2017-CT (R) dated 28-06-2017
which prescribes GST rate of 28% on lottery and Sl. No. 229 of Schedule IV which prescribes GST rate
of 28% on actionable claim in the form of chance to win in betting, gambling or horse racing in race
club, with the amended para 6 of Schedule III of CGST Act, 2017.
e. Implementation Status: In pursuance of the GIC decision dated 29.09.2023, the Notification No.
11/2023- Central Tax (Rate) dated 29.09.2023, Notification No. 14/2023- Integrated Tax (Rate), dated
29.09.2023 and Notification No. 11/2023- Union Territory Tax (Rate), dated 29.09.2023 were issued.


Agenda for 52nd GSTCM Volume 1
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Agenda Item 3: Issues recommended by the Law Committee for the consideration of the GST
Council
Agenda Item 3(i): Alignment of provisions of the CGST Act, 2017 with the provisions of the
Tribunal Reforms Act, 2021 in respect of Appointment of President and Member of the proposed
GST Appellate Tribunals.
It may be recalled that vide the Finance Act, 2023, amendments to section 109 and 110 of the
CGST Act, 2017 were carried out and the same were notified vide notification No. 28/2023–Central
Tax dated 31st July, 2023. Subsequently, a proposal was sent by the Department of Revenue to the
Hon’ble Chief Justice of India with a request to Chair or to nominate a Judge of the Supreme Court to
chair the Search-cum-Selection Committee to make recommendations for appointment of Judicial
Members and Technical Member (Centre) of GSTAT and to nominate a retired Judge of Supreme Court
or a retired Chief Justice of High Court as a Member of ScSC.
2. In response, the following observations were received from the Registrar, Supreme Court of
India:
a. The post of the President of the Appellate Tribunal is vacant at present and no action appears
to have been taken by the Government for appointment of the President of the Appellate
Tribunal, who is one of the members of the Search-cum-Selection Committee under Section
110 (4) (b) (iv) (B) of amended CGST Act 2017;
b. The prescribed maximum age limit, under Section 110 (9) and (10), for the posts of President
and Members is 67 and 65 years whereas under the Tribunals Reforms Act, 2021 it is 70 and
67 years respectively. (as per the CGST Act 2017 and recommendations made by GoM
constituted vide O.M No. A-50050/150/2018-CESTAT-DOR)
c. A provision relating to eligibility of an Advocate with a standing of 10 years at the Bar for
appointment as a Judicial Member, akin to the one available in the Rules framed under the
Tribunal Reforms Act, 2021 is missing in the amended CGST Act, 2023.
3. Vide para 2(b) and (c) above, it was emphasized that certain provisions of the GSTAT need to
be aligned with the Tribunal Reforms Act, 2021. In this context, the relevant portion the Tribunal
Reform Act, 2021 and the Tribunal (Condition of Service) Rules, 2021 were referred as under:
• In respect of para (b), proviso to section 3(1) of Tribunal Reform Act, 2021 provides that a
person who has not completed the age of fifty years shall not be eligible for appointment as a
Chairperson or Member.
Also, section 5 of Tribunal Reform Act, 2021 states that:
i. The Chairperson of a Tribunal shall hold office for a term of four years or till he
attains the age of seventy years, whichever is earlier.
ii. The Member of a Tribunal shall hold office for a term of four years or till he attains
the age of sixty-seven years, whichever is earlier.
• In respect of para (c), section 3(3)(b)(iii) of Tribunal (Condition of Service) Rules, 2021
states that:
Agenda for 52nd GSTCM Volume 1
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In case of Customs, Excise and Service Tax Appellate Tribunal under the Customs Act,
1962 (52 of 1962), a person shall not be qualified for appointment as Judicial Member,
unless he has been an advocate for ten years with substantial experience in litigation
under indirect tax laws in CESTAT, High Court or Supreme Court.

4. Accordingly, the issue of alignment of the provisions of GSTAT with the Tribunal Reform Act
& Tribunal (Condition of Service) Rules, 2021, was placed before the Law Committee. Law Committee,
in its meeting held on 21.09.2023 approved the following amendments to section 110 of the CGST Act,
2017:
110. President and Members of Appellate Tribunal, their qualification,
appointment, conditions of service, etc.
(1) A person shall not be qualified for appointment as—
(a) the President, unless he has been a Judge of the Supreme Court or is or has been
the Chief Justice of a High Court;
(b) a Judicial Member, unless he—
(i) has been a Judge of the High Court; or Substitution of new section for section 110.
President and Members of Appellate Tribunal, their qualification, appointment,
conditions of service, etc.
(ii) has, for a combined period of ten years, been a District Judge or an Additional
District Judge;
(iii)has been an advocate for ten years with substantial experience in litigation under
indirect tax laws in the Appellate Tribunal, Central Excise and Service Tax Tribunal,
State VAT Tribunals, by whatever name called, High Court or Supreme Court;
(c) a Technical Member (Centre), unless he is or has been a member of the Indian
Revenue (Customs and Indirect Taxes) Service, Group A, or of the All India Service
with at least three years of experience in the administration of an existing law or goods
and services tax in the Central Government, and has completed at least twenty-five
years of service in Group A;
(d) a Technical Member (State), unless he is or has been an officer of the State
Government or an officer of All India Service, not below the rank of Additional
Commissioner of Value Added Tax or the State goods and services tax or such rank,
not lower than that of the First Appellate Authority, as may be notified by the concerned
State Government, on the recommendations of the Council and has completed twenty-
five years of service in Group A, or equivalent, with at least three years of experience
in the administration of an existing law or the goods and services tax or in the field of
finance and taxation in the State Government:
Provided that the State Government may, on the recommendations of the Council, by
notification, relax the requirement of completion of twenty-five years of service in
Group A, or equivalent, in respect of officers of such State where no person has
completed twenty-five years of service in Group A, or equivalent, but has completed
twenty-five years of service in the Government, subject to such conditions, and till such
period, as may be specified in the notification.
Agenda for 52nd GSTCM Volume 1
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Provided that a person who has not completed the age of fifty years shall not be eligible for
appointment as the President or the Member.
... ... ...
(9) Notwithstanding anything contained in any judgment, order, or decree of any court or any
law for the time being in force, the President of the Appellate Tribunal shall hold office for a
term of four years from the date on which he enters upon his office, or until he attains the age
of sixty-seven seventy years, whichever is earlier and shall be eligible for re-appointment for a
period not exceeding two years.
(10) Notwithstanding anything contained in any judgment, order, or decree of any court or any
law for the time being in force, the Judicial Member, Technical Member (Centre) or Technical
Member (State) of the Appellate Tribunal shall hold office for a term of four years from the
date on which he enters upon his office, or until he attains the age of sixty-five sixty-seven years,
whichever is earlier and shall be eligible for re-appointment for a period not exceeding two
years.

5. Accordingly, amendments to section 110 of the CGST Act, 2017 are placed before the GST
Council for approval please. It may be noted, that similar amendments are required to be carried out in
the corresponding sections of the respective SGST Acts of the States.


Agenda for 52nd GSTCM Volume 1
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Agenda Item 3(ii): Seeking clarity on various issues
(i) Regarding taxability of personal guarantee offered by directors to the bank against the credit
limits/loans being sanctioned to the company.
(ii) Regarding taxability of corporate guarantee provided for related persons including corporate
guarantee provided by holding company to its subsidiary company.

Various representations have been received from trade associations seeking clarity as to
whether the offering of personal guarantees by directors of a company to the bank/ financial institutions
for sanctioning of credit facilities to the company will be treated as a supply of service or not and
whether the same will attract GST or not. Further, clarification is also being sought as to whether the
corporate guarantee provided by a holding company to its subsidiary company or by any entity to its
related parties, is to be treated as a supply of service or not, and if so what would be the valuation of
such supplies.

2. RELEVANT LEGAL PROVISIONS:

2.1 Section 7(1)(c) of the CGST Act, 2017 is reproduced below:

“(1) For the purposes of this Act, the expression - "supply" includes-
…
(c) the activities specified in Schedule I, made or agreed to be made without a consideration;
…”
2.2 Further, relevant entries in Schedule I of CGST Act, 2017 are as reproduced below:
“SCHEDULE I: Activities to be treated as supply even if made without consideration
..
(2) Supply of goods or services or both between related persons or between distinct persons
as specified in section 25, when made in the course or furtherance of business:
Provided that gifts not exceeding fifty thousand rupees in value in a financial year by an
employer to an employee shall not be treated as supply of goods or services or both.
……………………
(4) Import of services by a 1[person] from a related person or from any of his other
establishments outside India, in the course or furtherance of business..”
2.3 Reference is also made to Section 15 of the CGST Act, 2017:
“Section 15. Value of Taxable Supply.-
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(1) The value of a supply of goods or services or both shall be the transaction value, which is
the price actually paid or payable for the said supply of goods or services or both where the
supplier and the recipient of the supply are not related and the price is the sole consideration
for the supply.
………..
Explanation. - For the purposes of this Act,-
(a) persons shall be deemed to be "related persons" if-
(i) such persons are officers or directors of one another's businesses;
………….”
2.4 Also, Entry No. 6 of Notification No.13/2017 –CT (Rate) dated 28th June, 2017 is as reproduced
below:
“
S.No. Category of Supply of Services Supplier of service Recipient of Service
6. Services supplied by a director of a
company or a body corporate to the
said company or the body
corporate.
A director of a
company or a body
corporate
The company or a
body corporate
located in the taxable
territory.
…………………”

2.5 Section 2 – Definitions of the Companies Act, 2013, defines the following:
2(46) ―holding company, in relation to one or more other companies, means a company of
which such companies are subsidiary companies;
2(87) ―subsidiary company or ―subsidiary, in relation to any other company (that is to say
the holding company), means a company in which the holding company—
(i) controls the composition of the Board of Directors; or
(ii) exercises or controls more than one-half of the total share capital either at its own
or together with one or more of its subsidiary companies:
Provided that such class or classes of holding companies as may be prescribed shall
not have layers of subsidiaries beyond such numbers as may be prescribed.
Explanation. —For the purposes of this clause, —
Agenda for 52nd GSTCM Volume 1
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(a) a company shall be deemed to be a subsidiary company of the holding
company even if the control referred to in sub-clause (i) or sub-clause (ii) is of another
subsidiary company of the holding company;
(b) the composition of a company’s Board of Directors shall be deemed to be
controlled by another company if that other company by exercise of some power
exercisable by it at its discretion can appoint or remove all or a majority of the
directors;
(c) the expression ―company includes any body corporate;
(d) layer in relation to a holding company means its subsidiary or subsidiaries;

2.6 Rule 28 of CGST Rules, 2017 are as under:
“28. Value of supply of goods or services or both between distinct or related persons, other than
through an agent. -
The value of the supply of goods or services or both between distinct persons as specified in sub-
section (4) and (5) of section 25 or where the supplier and recipient are related, other than where
the supply is made through an agent, shall-
(a) be the open market value of such supply;
(b) if the open market value is not available, be the value of supply of goods or services of like
kind and quality;
(c) if the value is not determinable under clause (a) or (b), be the value as determined by the
application of rule 30 or rule 31, in that order:
Provided that where the goods are intended for further supply as such by the recipient, the value
shall, at the option of the supplier, be an amount equivalent to ninety percent of the price charged
for the supply of goods of like kind and quality by the recipient to his customer not being a related
person:
Provided further that where the recipient is eligible for full input tax credit, the value declared in
the invoice shall be deemed to be the open market value of the goods or services.”
3. Analysis and Proposal:
A. Regarding taxability of personal guarantee offered by directors to the bank against the credit
limits/loans being sanctioned to the company:
3.1 Under GST, supply is the relevant taxable event for levying tax. For an activity/transaction to
be liable to GST, existence of ‘supply’ as defined under section 7 of CGST Act, 2017 should be there.
Section 7 of CGST Act, 2017 defines supply to mean ‘all forms of supply of goods or services or both
Agenda for 52nd GSTCM Volume 1
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made or agreed to be made for a consideration by a person in the course or furtherance of business.’
Further, as per clause (c) of sub-section (1) of section 7 of the CGST Act, 2017, read with S. No. 2 of
Schedule I of CGST Act, supply of goods or services or both between related persons, when made in
the course or furtherance of business, shall be treated as supply even if made without consideration.
Explanation (a) to Section 15 of CGST Act clearly provides that directors and the company are related
persons.
3.2 On joint reading of the provisions above, the services that are provided by the director to a
company by way of providing personal guarantee to banks/ financial institutions in order to secure
credit facilities even without any consideration, will fall under the category of supply of services.
Therefore, the same was taxable under GST.
3.3 Now, reference is also made to RBI Master Circular RBI/2021-22/121 dated 9th November,
2021 in respect of guarantees and co-acceptances. Relevant portion of Para 2.2.9 of the said circular is
reproduced below:
“2.2.9 Guidelines relating to obtaining of personal guarantees of promoters, directors, other
managerial personnel, and shareholders of borrowing concerns
Banks should take personal guarantees of promoters, directors, other managerial personnel or
major shareholders for the credit facilities granted to corporates, public or private, only when
absolutely warranted after a careful examination of the circumstances of the case and not as a
matter of course. In order to identify the circumstances under which the guarantee may or may
not be considered necessary, banks should be guided by the following broad considerations:
…………………..
C. Worth of the guarantors, payment of guarantee commission, etc
Where personal guarantees of directors are warranted, they should bear reasonable
proportion to the estimated worth of the person. The system of obtaining guarantees should
not be used by the directors and other managerial personnel as a source of income from the
company. Banks should obtain an undertaking from the borrowing company as well as the
guarantors that no consideration whether by way of commission, brokerage fees or any other
form, would be paid by the former or received by the latter, directly or indirectly. This
requirement should be incorporated in the bank's terms and conditions for sanctioning of
credit limits. During the periodic inspections, the bank's inspectors should verify that this
stipulation has been complied with. There may, however, be exceptional cases where payment
of remuneration may be permitted e.g. where assisted concerns are not doing well and the
existing guarantors are no longer connected with the management but continuance of their
guarantees is considered essential because the new management's guarantee is either not
available or is found inadequate.
…………………..”

3.4 As per the mandate of RBI as per Para 2.2.9 of RBI Master Circular RBI/2021-22/121 dated
9th November, 2021 regarding guidelines relating to obtaining of personal guarantees of promoters,
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directors, other managerial personnel, and shareholders of borrowing concerns, no consideration can
be charged by the director from the company for providing the bank guarantee for the purpose of
sanctioning of credit facilities to the said company and therefore, no transaction value can be attributed
to the service being provided by the Director.

3.5 As such, when such guarantee is required by the bank or the financial institution from the
director of the company for providing credit facility/ loan to the said company and when no
consideration can be paid for the said transaction by the company to the director in any form, directly
or indirectly, there is no question of such supply/ transaction having any open market value.
Accordingly, it appears that when no consideration is paid by the company to the director in any form,
directly or indirectly, for providing guarantee to the bank/ financial institutes on their behalf, as per
mandate of RBI, the open market value of the said transaction/ supply may be treated as zero. In such
a scenario, it appears that the taxable value of the said supply as per section 15 of the CGST Act, 2017
read with rule 28 of the CGST Rules, 2017, may be treated as zero, and no tax may be payable on such
supply of service by the director to the company.

3.6 There may, however, be cases where the director, who had provided the guarantee, is no longer
connected with the management but continuance of his guarantee is considered essential because the
new management's guarantee is either not available or is found inadequate or there may be other
exceptional cases where the promoters, existing directors, other managerial personnel, and shareholders
of borrowing concerns are paid remuneration/ consideration in any manner, directly or indirectly. In
such cases, as per the RBI guidelines provided in Para 2.2.9 (c) of RBI’s Circular No. RBI/2021-22/121
dated 9th November, 2021, remuneration can be paid to such directors/ guarantors for providing the
bank guarantee. In all these cases, the taxable value of such supply of service may be the remuneration/
consideration provided to such a person/ guarantor by the company, directly or indirectly.
3.7 Law Committee in its meetings held on 31.08.2023/01.09.2023 and 21.09.2023 deliberated on
the issue and recommended issuing a circular to clarify the same as above.

B. Regarding taxability of corporate guarantee provided for related persons including
corporate guarantee provided by holding company to its subsidiary company.

4.1 On the issue of providing corporate guarantee between the related companies, even without
any monetary consideration, the said activity is taxable as services provided between related persons,
as per Schedule I of the CGST Act 2017.
4.2 As per the explanation to sub-section (5) of Section 15 of the CGST Act, read with the
definitions of ‘holding company’ and ‘subsidiary company’ under Companies Act, 2013, it is clear that
the holding company and the subsidiary company are also ‘related persons’, and hence the corporate
guarantee provided by the holding company to its subsidiary company, even without consideration, in
the course of furtherance of business are to be treated as ‘supply’ under GST as per Schedule I of the
CGST Act, 2017.
4.3 In such cases, the taxable value of the supply has to be determined as per Rule 28 of the CGST
Rules, 2017 which is mainly based on the open market value of such supply or as per value of services
of like kind and quality or as per Rule 30 or 31 of CGST Rules, 2017. However, corporate guarantees,
unlike bank guarantees, are specific and peculiar to a particular corporate group or company and
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therefore external third-party comparisons may not be available or relatable. The commission for
providing corporate guarantee generally depends on multiple factors like, inherent credit-worthiness of
the concerned company, amount guaranteed, borrowing history of the said company, soundness of the
financial statements, current cash flows and income of the company that is being provided the guarantee
and the financial relationship of the concerned bank/ financial institutions with the said company etc.
Field formations as well as the taxpayers are finding it difficult to arrive at the open market value for
such supply of services under Rule 28 of CGST Rules, 2017.
4.4 While in cases, where the recipient is eligible for full input tax credit, as per the second proviso
to the rule 28 of CGST Rules, 2017, the value declared in the invoice, if any, shall be deemed to be the
open market value of the said supply of services. However, in cases, where the recipient is not eligible
for full input tax credit, there are difficulties being faced by the field formation as well as by the
taxpayers to determine the taxable value based on the open market value of services, or value of services
of like kind and quality or as per Rule 30 or 31. In this regard, it is mentioned that all the banks have
got different rates of commission/ charges for bank guarantee ranging from 0.5% to 3%. In some cases,
banks may not be charging any commission/ charge at all, depending upon the longstanding relationship
with the concerned client. It is also observed that under Rule 10TD pertaining to Safe Harbour under
Income Tax Rules, 1962, for providing corporate guarantee in eligible international transactions, the
minimum acceptable commission/ fee is one per cent of the amount guaranteed. Therefore, it is
proposed that we may consider adopting the same for the purpose of valuation of the supply of services
of providing corporate guarantee in case of related persons under GST also.
4.5 The matter was deliberated by the Law Committee in its meetings held on 31.08.2023/01.09.23
and 21.09.2023 wherein the Law Committee recommended to insert the following sub-rule in Rule 28
of CGST Rules, 2017.
28. Value of supply of goods or services or both between distinct or related persons, other than
through an agent. -
(1) The value of the supply of goods or services or both between distinct persons as specified in
sub-section (4) and (5) of section 25 or where the supplier and recipient are related, other than
where the supply is made through an agent, shall-
(a) be the open market value of such supply;
(b) if the open market value is not available, be the value of supply of goods or services of like
kind and quality;
(c) if the value is not determinable under clause (a) or (b), be the value as determined by the
application of rule 30 or rule 31, in that order:
Provided that where the goods are intended for further supply as such by the recipient, the value
shall, at the option of the supplier, be an amount equivalent to ninety percent of the price charged
for the supply of goods of like kind and quality by the recipient to his customer not being a related
person:
Provided further that where the recipient is eligible for full input tax credit, the value declared in
the invoice shall be deemed to be the open market value of the goods or services.;
Agenda for 52nd GSTCM Volume 1
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(2) Notwithstanding anything contained in sub-rule (1), the value of supply of services by a supplier
to a recipient who is a related person, by way of providing corporate guarantee to any banking
company or financial institution on behalf of the said recipient, shall be deemed to be one per cent
of the amount of such guarantee offered, or the actual consideration, whichever is higher.

4.6 The Law Committee also recommended to clarify the applicability of the proposed sub-rule (2)
of the rule 28 of CGST Rules, 2017 vide a circular. The circular recommended by the Law Committee
is placed at Annexure-A.

5. Accordingly, the recommendations of the Law Committee as detailed in para 3.7, 4.5 and 4.6
above are placed before the GST Council for approval.

Agenda for 52nd GSTCM Volume 1
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ANNEXURE-A
Circular No. XX/XX/2023-GST

F. No. CBIC-20016/23/2023 - GST
Government of India
Ministry of Finance
(Department of Revenue)
Central Board of Indirect Taxes and Customs
GST Policy Wing
*****

New Delhi, Dated the XXXXXX, 2023
To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/
Commissioners of Central Tax (All)
The Principal Directors General/ Directors General (All)
Madam/Sir,
Subject: Clarification on various issues pertaining to GST-reg.

Representations have been received from the trade and field formations seeking clarification
on certain issues with respect to taxability of activity of providing personal bank guarantee by Directors
to banks for securing credit facilities for the company. Similarly, clarifications are being sought with
respect to taxability and valuation of the activity of providing corporate guarantee by a related person
to banks/financial institutions for another related person, as well as by a holding company in order to
secure credit facilities for its subsidiary company.

2. In order to ensure uniformity in the implementation of the provisions of law across the field
formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods and
Services Tax Act, 2017 (hereinafter referred to as “CGST Act”), hereby clarifies the issues as under:













Agenda for 52nd GSTCM Volume 1
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S.
No.
Issue Clarification
1. Whether the activity of providing
personal guarantee by the Director of a
company to the bank/ financial
institutions for sanctioning of credit
facilities to the said company without any
consideration will be treated as a supply
of service or not and whether the same
will attract GST or not.
As per Explanation (a) to section 15 of CGST
Act, the director and the company are to be
treated as related persons. As per clause (c) of
sub-section (1) of section 7 of the CGST Act,
2017, read with S. No. 2 of Schedule I of CGST
Act, supply of goods or services or both
between related persons, when made in the
course or furtherance of business, shall be
treated as supply even if made without
consideration. Accordingly, the activity of
providing personal guarantee by the Director to
the banks/ financial institutions for securing
credit facilities for their companies is to be
treated as a supply of service, even when made
without consideration.
Rule 28 of Central Goods and Services Tax
Rules, 2017 (hereinafter referred to as “CGST
Rules”) prescribes the method for determining
the value of the supply of goods or services or
both between related parties, other than where
the supply is made through an agent. In terms
of Rule 28 of CGST Rules, the transaction value
of such supply of service shall be the open
market value of such supply.
RBI has provided guidelines for obtaining
personal guarantee of promoters, directors and
other managerial personnel of the borrowing
concerns vide Para 2.2.9 of its Circular No.
RBI/2021-22/121 dated 9th November, 2021,
which is reproduced below:
“2.2.9 Guidelines relating to obtaining of
personal guarantees of promoters, directors,
other managerial personnel, and shareholders
of borrowing concerns
Banks should take personal guarantees of
promoters, directors, other managerial
personnel or major shareholders for the credit
facilities granted to corporates, public or
private, only when absolutely warranted after a
careful examination of the circumstances of the
case and not as a matter of course. In order to
identify the circumstances under which the
Agenda for 52nd GSTCM Volume 1
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guarantee may or may not be considered
necessary, banks should be guided by the
following broad considerations:
…………………..
C. Worth of the guarantors, payment of
guarantee commission, etc
Where personal guarantees of directors are
warranted, they should bear reasonable
proportion to the estimated worth of the person.
The system of obtaining guarantees should not
be used by the directors and other managerial
personnel as a source of income from the
company. Banks should obtain an
undertaking from the borrowing company as
well as the guarantors that no consideration
whether by way of commission, brokerage fees
or any other form, would be paid by the former
or received by the latter, directly or indirectly.
This requirement should be incorporated in
the bank's terms and conditions for
sanctioning of credit limits. During the
periodic inspections, the bank's inspectors
should verify that this stipulation has been
complied with. There may, however, be
exceptional cases where payment of
remuneration may be permitted e.g. where
assisted concerns are not doing well and the
existing guarantors are no longer connected
with the management but continuance of their
guarantees is considered essential because the
new management's guarantee is either not
available or is found inadequate.
…………………..”
Accordingly, as per mandate provided by RBI
in terms of Para 2.2.9 (C) of RBI’s Circular No.
RBI/2021-22/121 dated 9th November, 2021, no
consideration by way of commission, brokerage
fees or any other form, can be paid to the
director by the company, directly or indirectly,
in lieu of providing personal guarantee to the
bank for borrowing credit limits. As such, when
no consideration can be paid for the said
transaction by the company to the director in
Agenda for 52nd GSTCM Volume 1
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any form, directly or indirectly, as per RBI
mandate, there is no question of such supply/
transaction having any open market value.
Accordingly, the open market value of the
said transaction/ supply may be treated as
zero. In such a scenario, no tax is payable on
such supply of service by the director to the
company.
There may, however, be cases where the
director, who had provided the guarantee, is no
longer connected with the management but
continuance of his guarantee is considered
essential because the new management's
guarantee is either not available or is found
inadequate, or there may be other exceptional
cases where the promoters, existing directors,
other managerial personnel, and shareholders of
borrowing concerns are paid remuneration/
consideration in any manner, directly or
indirectly. In all these cases, the taxable value
of such supply of service shall be the
remuneration/ consideration provided to such a
person/ guarantor by the company, directly or
indirectly.
2. Whether the activity of providing corporate
guarantee by a person on behalf of another
related person, or by the holding company
for sanction of credit facilities to its
subsidiary company, to the bank/ financial
institutions, even when made without any
consideration will be treated as a taxable
supply of service or not, and if taxable,
what would be the valuation of such supply
of services.
Where the corporate guarantee is provided by
a company to the bank/financial institutions for
providing credit facilities to the other company,
where both the companies are related, the activity is
to be treated as a supply of service between related
parties as per provisions of Schedule I of CGST Act,
even when made without any consideration.

Similarly, where the corporate guarantee is
provided by a holding company, for its subsidiary
company, those two entities also fall under the
category of ‘related persons’. Hence the activity of
providing corporate guarantee by a holding
company to the bank/financial institutions for
securing credit facilities for its subsidiary company,
even when made without any consideration, is also
to be treated as a supply of service by holding
company to the subsidiary company, being a related
person, as per provisions of Schedule I of CGST
Act.
In respect of such supply of services by a
person to another related person or by a holding
Agenda for 52nd GSTCM Volume 1
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company to a subsidiary company, in form of
providing corporate guarantee on their behalf to a
bank/ financial institution, the taxable value will be
determined as per rule 28 of CGST Rules.
Considering different practices being followed
by the field formations and taxpayers in determining
such taxable value, in order to provide uniformity in
practices and ease of implementation, sub-rule (2)
has been inserted in rule 28 of CGST Rules vide
Notification No. xx/2023 dated xx.xx.2023, for
determining the taxable value of such supply of
services between related persons in respect of
providing corporate guarantee. Accordingly,
consequent to insertion of the said sub-rule in rule
28 of CGST Rules, in all such cases of supply of
services by a related person to another person, or by
a holding company to a subsidiary company, in the
form of providing corporate guarantee on their
behalf to a bank/ financial institution, the taxable
value of such supply of services, will henceforth be
determined as per the provisions of the sub-rule (2)
of Rule 28 of CGST Rules, irrespective of whether
full ITC is available to the recipient of services or
not.
It is clarified that the sub-rule (2) of Rule 28 shall
not apply in respect of the activity of providing
personal guarantee by the Director to the banks/
financial institutions for securing credit facilities for
their companies and the same shall be valued in the
manner provided in S. No. (1) above.

3. It is requested that suitable trade notices may be issued to publicize the contents of this
Circular.
4. Difficulties, if any, in implementation of this Circular may please be brought to the notice of
the Board. Hindi version would follow.


(Sanjay Mangal)
Principal Commissioner (GST)





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Agenda Item 3(iii): Providing a special procedure for condonation of delay in filing of appeals
against demand orders passed until 31st March, 2023.
1.1 Section 107(1) of the CGST Act, 2017 provides that any person aggrieved with the order of
the Adjudicating Authority can file an appeal against such order before the Appellate Authority. The
said provisions also provide that such appeal shall be filed within a period of three months from the
date on which the order is communicated to such person.
"Section 107. Appeals to Appellate Authority. —
(1) Any person aggrieved by any decision or order passed under this Act or the State Goods and
Services Tax Act or the Union Territory Goods and Services Tax Act by an adjudicating authority
may appeal to such Appellate Authority as may be prescribed within three months from the date
on which the said decision or order is communicated to such person."

1.2 Additionally, Section 107(4) of the CGST Act, 2017 empowers the Appellate Authority to
condone the delay in filing of appeal by the aggrieved person. However, the Appellate Authority can
condone such a delay only if sufficient cause is shown and the delay is not beyond the period of one
month from the actual due date.
“Section 107. Appeals to Appellate Authority. —
(4) The Appellate Authority may, if he is satisfied that the appellant was prevented by sufficient cause
from presenting the appeal within the aforesaid period of three months or six months, as the case may
be, allow it to be presented within a further period of one month.
This is to say that, even when sufficient cause is shown for not filing appeal against a said order within
the prescribed time limit, the appellate authority cannot condone the delay beyond one month from
the actual due date.

2.1 In this regard, it is to mention that during the initial years of implementation of GST, a number
of appeals against demand orders could not be filed with the specified time period i.e., within the
limitation period of three months and the permissible delay condonation period of one month, due to
various reasons.

2.2 Section 169. Service of notice in certain circumstances. -
(1) Any decision, order, summons, notice or other communication under this Act or the rules made
thereunder shall be served by any one of the following methods, namely: -
(a) by giving or tendering it directly or by a messenger including a courier to the addressee or
the taxable person or to his manager or authorised representative or an advocate or a tax
practitioner holding authority to appear in the proceedings on behalf of the taxable person or to
a person regularly employed by him in connection with the business, or to any adult member of
family residing with the taxable person; or
Agenda for 52nd GSTCM Volume 1
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(b) by registered post or speed post or courier with acknowledgement due, to the person for
whom it is intended or his authorised representative, if any, at his last known place of business
or residence; or
(c) by sending a communication to his e-mail address provided at the time of registration or as
amended from time to time; or
(d) by making it available on the common portal; or
(e) by publication in a newspaper circulating in the locality in which the taxable person or the
person to whom it is issued is last known to have resided, carried on business or personally
worked for gain; or
(f) if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his
last known place of business or residence and if such mode is not practicable for any reason,
then by affixing a copy thereof on the notice board of the office of the concerned officer or
authority who or which passed such decision or order or issued such summons or notice.
(2) Every decision, order, summons, notice or any communication shall be deemed to have been served
on the date on which it is tendered or published or a copy thereof is affixed in the manner provided in
sub-section (1).

2.3 As per provision in section 169 of the CGST Act, 2017, any communication to the e-mail
address provided at the time of registration or as amended from time to time or making it available
on the common portal has been termed as a valid mode of service of notices or orders. Accordingly,
the notices /orders in the above proceedings were served electronically on the common portal. There
was no physical service of these notice/orders in many cases, as the law prescribes the common portal
also as the valid mode of service of notices and orders. In a lot of cases, the common portal was not
accessed by the taxpayers and hence taxpayers were not aware of the notices/ orders issued to them
through the common portal.
2.4 Further in the pre-GST era they were used to physical service of the notices, hence were not
in habit of checking the portal for the notices/orders. While migrating to GST from the earlier tax
system, in many cases, taxpayers have also used their old email ID or mobile numbers. In many cases
the email ID or mobile numbers used in migration belonged to CAs or tax practitioners. Same is the
situation in cases of GST registrations obtained during initial period of GST. In many cases, entire
work of GST filing is done by practitioners. This has also resulted in losing track of orders/notices
served on common portal/email.
2.5 It is brought to the notice of the tax authorities that, many of the taxpayers came to know about
demand orders only upon initiation of recovery proceedings under section 79 of the CGST Act, 2017
i.e., after lapse of time prescribed for filing of appeals. Thus, the taxpayers are stuck in a situation
where they can neither file an appeal nor pay the demand raised by the tax authorities. Many of these
appeals filed beyond the specified time period are either pending with the appellate authorities or were
rejected earlier for non-adherence to time period specified under Section 107(1) of the CGST Act,
2017.

Agenda for 52nd GSTCM Volume 1
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2.6 At the same time, the recovery books of the authorities are bulging without sufficient recovery.
There are many cases where huge sums are involved, and dues are stuck in time barred appeals (at
quasi-judicial level) causing non-realization of legitimate revenue and even the part payment towards
filing of appeal i.e., pre-deposit. As the appeals are likely to be rejected even if they are filed, in view
of limited power of the appellate authority to condone any delays, the pre-deposit amount is also not
being realized in the books of the government. If such appeals are allowed by condoning delay, then
a large number of such taxpayers are likely to come forward and pay the pre-deposit amount. It is also
to be mentioned that due to the non-constitution of GST Appellate Tribunals, the only remedy
available to the taxpayers was approaching the Hon’ble High Courts, which might not be always
possible for small and medium taxpayers.

3. In order to deal with such time-barred appeals against demand orders passed till specified
period i.e., orders passed up to 31.3.2023, it was proposed to provide a one-time relief to taxpayers for
filing of appeals.

4. Law Committee in its meetings held on 31.08.23/01.09.23 and 21.09.23 deliberated on the
same, and recommended providing a special procedure under section 148 of CGST Act, for
taxable persons to file appeal till 31st December 2023, who could not file an appeal under
section 107 of the said Act, against the order passed by the proper officer under section 73 or
74 of the said Act on or before the 31st day of March, 2023 and the taxable persons whose
appeal against the said order was rejected solely on the grounds that the said appeal was not
filed within the time period specified in sub-section (1) of section 107, subject to the condition
of payment of an amount of pre-deposit of 12.5% of the tax under dispute by the said person,
out of which at least 20% (i.e. 2.5% of the tax under dispute) should be debited from Electronic
Cash Ledger. The draft notification for the said special procedure as recommended by the Law
Committee is placed at Annexure-A.

5. Accordingly, the recommendations of the Law Committee as detailed in para 4 is placed before
the GST Council for approval.
Agenda for 52nd GSTCM Volume 1
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ANNEXURE-A
[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II,
SECTION 3, SUB-SECTION (ii)]

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

NOTIFICATION No. XX/2023 – CENTRAL TAX

New Delhi, dated the xx, xxxx 2023

S.O.(E).— In exercise of the powers conferred by section 148 of the Central Goods and Services
Tax Act, 2017 (12 of 2017) (hereinafter referred to as the said Act), the Central Government, on the
recommendations of the Council, hereby notifies taxable persons who could not file an appeal against
the order passed by the proper officer under section 73 or 74 of the said Act on or before the 31st day of
March, 2023 (hereinafter referred to as the said order), within the time period specified in sub-section
(1) of section 107 read with sub-section (4) of section 107 of the said Act, and the taxable persons whose
appeal against the said order was rejected solely on the grounds that the said appeal was not filed within
the time period specified in section 107, as the class of persons (hereinafter referred to as the said
person) who shall follow the following special procedure for filing appeals in such cases:
2. The said person shall file an appeal against the said order in FORM GST APL-01 in
accordance with sub-section (1) of Section 107 of the said Act, on or before 31st day of December 2023:
Provided that an appeal against the said order filed in accordance with the provisions of section
107 of the said Act, and pending before the Appellate Authority before the issuance of this notification,
shall be deemed to have been filed in accordance with this notification.
3. No appeal shall be filed under this notification, unless the appellant has paid-
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from
the impugned order, as is admitted by him; and
(b) a sum equal to twelve and a half per cent. of the remaining amount of tax in dispute
arising from the said order, subject to a maximum of twenty-five crore rupees, in relation to
which the appeal has been filed, out of which at least twenty percent should have been paid by
debiting from the Electronic Cash Ledger.
4. No refund shall be granted on account of this notification till the disposal of the appeal, in
respect of any amount paid by the appellant, either on their own or on the directions of any authority
(or) court, in excess of the amount specified in para 3 of this notification before the issuance of this
notification, for filing an appeal under sub-section (1) of Section 107 of the said Act.
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5. No appeal under this notification shall be admissible in respect of a demand not involving tax.
6. The provisions of Chapter XIII of the Central Goods and Service Tax Rules, 2017, shall mutatis
mutandis, apply to an appeal filed under this Notification.
F. No. CBIC-XXXXXX/XX/2023-GST]

(Raghavendra Pal Singh)
Director

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Agenda Item 3(iv): Law amendment w.r.t. ISD as recommended by the GST Council in its 50th
meeting-reg.
GST Council in its 50th meeting recommended that ISD procedure, as laid down in Section 20 of Central
Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”) read with rule 39 of Central
Goods and Services Tax Rules, 2017 (hereinafter referred to as “CGST Rules”) may be made
mandatory prospectively for distribution of ITC in respect of input services procured by Head Office
(HO) from a third party but attributable to both HO and Branch Office (BO) or exclusively to one or
more BOs. Further, ITC on account of input services received from a third party, where such input
services are liable to tax on reverse charge basis, should also be required to be distributed through ISD
route. Further, the Council authorised the Law Committee to formulate the requisite law amendments.
The Council also recommended that the manner of distribution of ISD credit as provided in section 20
does not require amendment at present.
2. Accordingly, the Law Committee in its meeting held on 31.08.2023 and 01.09.2023 recommended
the following amendment in clause(61) of section 2 of the CGST Act, i.e. definition of ISD:
‘(61) “Input Service Distributor” means an office of the supplier of goods or services or both which
receives tax invoices issued under section 31 towards the receipt of input services and issues a
prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax
or Union territory tax paid on the said services to a supplier of taxable goods or services or both having
the same Permanent Account Number as that of the said office , including invoices in respect of services
liable to tax under sub-sections (3) or (4) of Section 9, for or on behalf of a distinct person or distinct
persons, as specified in section 25 and who is liable to distribute the input tax credit in respect of such
invoices in terms of section 20.
3. Further, section 20 of the CGST Act also needs amendment to explicitly mandate distribution of the
common credit including with credit pertaining to common input services which are liable to tax on
reverse charge basis. Accordingly, the Law Committee in its meeting held on 31.08.2023 and
01.09.2023 recommended that section 20 of CGST Act may be amended as under:
“20.(1) Any office of the supplier of goods or services or both which receives tax invoices towards the
receipt of input services, including invoices in respect of services liable to tax under sub-sections (3) or
(4) of Section 9, for or on behalf of a distinct person or distinct persons as specified in section 25, shall
be required to be registered as Input Service Distributor under clause (viii) of section 24 of this Act and
shall distribute the input tax credit in respect of such invoices.
(2) The Input Service Distributor shall distribute the credit of central tax or integrated tax charged on
invoices received by him, including the credit of central or integrated tax in respect of services subject
to levy of tax under sub-section (3) or (4) of Section 9 paid by a distinct person, registered in the same
State as the said Input Service Distributor, in such manner, within such time and subject to such
restrictions and conditions as may be prescribed.
(3) The credit of central tax shall be distributed as central tax or integrated tax and integrated tax as
integrated tax or central tax, by way of issue of a document containing the amount of input tax credit
being distributed in such manner as may be prescribed.

(1) The Input Service Distributor shall distribute the credit of central tax as central tax or integrated
tax and integrated tax as integrated tax or central tax, by way of issue of a document containing the
amount of input tax credit being distributed in such manner as may be prescribed.
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(2) The Input Service Distributor may distribute the credit subject to the following conditions,
namely:––
(a) the credit can be distributed to the recipients of credit against a document containing such details
as may be prescribed;
(b) the amount of the credit distributed shall not exceed the amount of credit available for distribution;
(c) the credit of tax paid on input services attributable to a recipient of credit shall be distributed only
to that recipient;
(d) the credit of tax paid on input services attributable to more than one recipient of credit shall be
distributed amongst such recipients to whom the input service is attributable and such distribution shall
be pro rata on the basis of the turnover in a State or turnover in a Union territory of such recipient,
during the relevant period, to the aggregate of the turnover of all such recipients to whom such input
service is attributable and which are operational in the current year, during the said relevant period;
(e) the credit of tax paid on input services attributable to all recipients of credit shall be distributed
amongst such recipients and such distribution shall be pro rata on the basis of the turnover in a State
or turnover in a Union territory of such recipient, during the relevant period, to the aggregate of the
turnover of all recipients and which are operational in the current year, during the said relevant period.
Explanation.––For the purposes of this section,––
(a) the “relevant period” shall be––
(i) if the recipients of credit have turnover in their States or Union territories in the financial year
preceding the year during which credit is to be distributed, the said financial year; or
(ii) if some or all recipients of the credit do not have any turnover in their States or Union
territories in the financial year preceding the year during which the credit is to be distributed, the
last quarter for which details of such turnover of all the recipients are available, previous to the
month during which credit is to be distributed;
(b) the expression “recipient of credit” means the supplier of goods or services or both having the same
Permanent Account Number as that of the Input Service Distributor;
(c) the term ‘‘turnover’’, in relation to any registered person engaged in the supply of taxable goods as
well as goods not taxable under this Act, means the value of turnover, reduced by the amount of any
duty or tax levied under [entries 84 and 92A]
46
of List I of the Seventh Schedule to the Constitution
and entries 51 and 54 of List II of the said Schedule. ”
Pari-materia amendments would also be required in the SGST Act.
4. In view of the aforesaid amendment in Section 20 of CGST Act, the Law Committee also
recommended that the methodology for distribution of credit may be incorporated in rule 39 of the
CGST Rules and the following rule be substituted for present rule 39 as follows:-
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“39. Procedure for distribution of input tax credit by Input Service Distributor.- (1) An Input
Service Distributor shall distribute input tax credit in the manner and subject to the following conditions,
namely:––
(a) the input tax credit available for distribution in a month shall be distributed in the same
month and the details thereof shall be furnished in FORM GSTR-6 in accordance with
the provisions of Chapter VIII of these rules;
(b) the amount of the credit distributed shall not exceed the amount of credit available for
distribution;
(c) the credit of tax paid on input services attributable to a recipient of credit shall be
distributed only to that recipient;
(d) the credit of tax paid on input services attributable to more than one recipient of credit
shall be distributed amongst such recipients to whom the input service is attributable
and such distribution shall be pro rata on the basis of the turnover in a State or turnover
in a Union territory of such recipient, during the relevant period, to the aggregate of the
turnover of all such recipients to whom such input service is attributable and which are
operational in the current year, during the said relevant period;
(e) the credit of tax paid on input services attributable to all recipients of credit shall be
distributed amongst such recipients and such distribution shall be pro rata on the basis
of the turnover in a State or turnover in a Union territory of such recipient, during the
relevant period, to the aggregate of the turnover of all recipients and which are
operational in the current year, during the said relevant period;
(f) the input tax credit that is required to be distributed in accordance with the provisions of
clause (d) and (e) to one of the recipients "R1", whether registered or not, from amongst
the total of all the recipients to whom input tax credit is attributable, including the
recipient(s) who are engaged in making exempt supply, or are otherwise not registered
for any reason, shall be the amount, "C1", to be calculated by applying the following
formula -
C 1 = (t 1 / T) x C
where,
"C" is the amount of credit to be distributed,
"t1 " is the turnover, as referred to in clause (d) and (e), of person R1 during the
relevant period, and
"T" is the aggregate of the turnover, during the relevant period, of all recipients
to whom the input service is attributable in accordance with the provisions
of clause (d) and (e);
(g) the Input Service Distributor shall, in accordance with the provisions of clause (d) and
(e), separately distribute the amount of ineligible input tax credit (ineligible under the
provisions of sub-section (5) of section 17 or otherwise) and the amount of eligible
input tax credit;
Agenda for 52nd GSTCM Volume 1
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(h) the input tax credit on account of central tax, State tax, Union territory tax and integrated
tax shall be distributed separately in accordance with the provisions of clause (d) and
(e);
(i) the input tax credit on account of integrated tax shall be distributed as input tax credit of
integrated tax to every recipient;

(j) the input tax credit on account of central tax and State tax or Union territory tax shall-

(i) in respect of a recipient located in the same State or Union territory in which the Input
Service Distributor is located, be distributed as input tax credit of central tax and State
tax or Union territory tax respectively;

(ii) in respect of a recipient located in a State or Union territory other than that of the
Input Service Distributor, be distributed as integrated tax and the amount to be so
distributed shall be equal to the aggregate of the amount of input tax credit of central tax
and State tax or Union territory tax that qualifies for distribution to such recipient as
referred to in clause (d) and (e);

(k) the Input Service Distributor shall issue an Input Service Distributor invoice, as prescribed
in sub-rule (1) of rule 54, clearly indicating in such invoice that it is issued only for
distribution of input tax credit;
(l) the Input Service Distributor shall issue an Input Service Distributor credit note, as
prescribed in sub-rule (1) of rule 54, for reduction of credit in case the input tax credit
already distributed gets reduced for any reason;

(m) any additional amount of input tax credit on account of issuance of a debit note to an Input
Service Distributor by the supplier shall be distributed in the manner and subject to the
conditions specified in clauses (a) to (j) and the amount attributable to any recipient shall
be calculated in the manner provided in clause (f) and such credit shall be distributed in
the month in which the debit note is included in the return in FORM GSTR-6;

(n) any input tax credit required to be reduced on account of issuance of a credit note to the
Input Service Distributor by the supplier shall be apportioned to each recipient in the same
ratio in which the input tax credit contained in the original invoice was distributed in terms
of clause (f), and the amount so apportioned shall be-

(i) reduced from the amount to be distributed in the month in which the credit note is
included in the return in FORM GSTR-6; or

Agenda for 52nd GSTCM Volume 1
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(ii) added to the output tax liability of the recipient where the amount so apportioned is
in the negative by virtue of the amount of credit under distribution being less than the
amount to be adjusted.

(1A) For the distribution of credit in respect of input services, attributable to one or more distinct
persons, subject to levy of tax under sub-section (3) or (4) of Section 9, a registered person, having the
same PAN and State code as an Input Service Distributor, may issue an invoice or, as the case may be,
a credit or debit note as per the provisions of sub-rule(1A) of rule 54 to transfer the credit of such
common input services to the Input Service Distributor, and such credit shall be distributed by the said
Input Service Distributor in the manner as provided in sub-rule (1).
(2) If the amount of input tax credit distributed by an Input Service Distributor is reduced later on for
any other reason for any of the recipients, including that it was distributed to a wrong recipient by the
Input Service Distributor, the process specified in clause (j) (n) of sub-rule (1) shall apply, mutatis
mutandis, for reduction of credit.
(3) Subject to sub-rule (2), the Input Service Distributor shall, on the basis of the Input Service
Distributor credit note specified in clause (h) (l) of sub-rule (1), issue an Input Service Distributor
invoice to the recipient entitled to such credit and include the Input Service Distributor credit note and
the Input Service Distributor invoice in the return in FORM GSTR-6 for the month in which such
credit note and invoice was issued.
Explanation.— For the purpose of this rule—
(i) the term “relevant period” shall be—
(a) if the recipients of credit have turnover in their States or Union territories in
the financial year preceding the year during which credit is to be distributed, the said
financial year; or
(b) if some or all recipients of the credit do not have any turnover in their States or
Union territories in the financial year preceding the year during which the credit is to be
distributed, the last quarter for which details of such turnover of all the recipients are
available, previous to the month during which credit is to be distributed;
(ii) the expression “recipient of credit” means the supplier of goods or services or both
having the same Permanent Account Number as that of the Input Service Distributor;
(iii) the term ‘‘turnover’’, in relation to any registered person engaged in the supply of
taxable goods as well as goods not taxable under this Act, means the value of turnover, reduced
by the amount of any duty or tax levied under entries 84 and 92A of List I of the Seventh
Schedule to the Constitution and entries 51 and 54 of List II of the said Schedule.”
5. Accordingly, the agenda is placed before GST Council for deliberation and approval.



Agenda for 52nd GSTCM Volume 1
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Agenda Item 3(v): Clarification regarding restoration of provisionally attached property –
regarding.
1.1 Section 83 of the CGST Act, 2017 is reproduced below:
Section 83. Provisional attachment to protect revenue in certain cases.-
(1) Where, after the initiation of any proceeding under Chapter XII, Chapter XIV or
Chapter XV, the Commissioner is of the opinion that for the purpose of protecting the interest
of the Government revenue it is necessary so to do, he may, by order in writing, attach
provisionally, any property, including bank account, belonging to the taxable person or any
person specified in sub-section (1A) of section 122, in such manner as may be prescribed.
(2) Every such provisional attachment shall cease to have effect after the expiry of a
period of one year from the date of the order made under sub-section (1).

1.2 Rule 159 of the CGST Rules, 2017 is reproduced below:
Rule 159. Provisional attachment of property. -
(1) Where the Commissioner decides to attach any property, including bank account
in accordance with the provisions of section 83, he shall pass an order in FORM GST DRC-
22 to that effect mentioning therein, the details of property which is attached.
(2) The Commissioner shall send a copy of the order of attachment in FORM GST
DRC-22 to the concerned Revenue Authority or Transport Authority or any such Authority to
place encumbrance on the said movable or immovable property, which shall be removed only
on the written instructions from the Commissioner to that effect and a copy of such order
shall also be sent to the person whose property is being attached under section 83.
…
(6) The Commissioner may, upon being satisfied that the property was, or is no longer
liable for attachment, release such property by issuing an order in FORM GST DRC- 23.

2.1 It is observed that while Section 83(2) of CGST Act, 2017 mentions that the provisional
attachment shall cease to have effect after the expiry of a period of one year from the date of the
order i.e. provisional attachment order in the form of FORM GST DRC-22, there is no mention of
need for issuance of any order to release/ restore the provisionally attached property after expiry of this
time period of one year.

2.2 At the same time, Rule 159(2) of CGST Rules, 2017 mentions that the provisional attachment
of a property shall be removed only on the written instructions from the Commissioner to that effect.
Rule 159(6) of CGST Rules, 2017 provides for release of the provisionally attached property by
issuance of an order in FORM GST DRC-23. As per the said rule, the Commissioner may release the
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provisionally attached property by issuing an order in FORM GST DRC-23, upon being satisfied
that the said property is no longer liable for attachment. However, there is no mention in sub-rule
(6) of rule 159 regarding requirement of issuance of order for releasing the provisionally attached
property after expiry of the time period of one year from the date of the provisional attachment order
in the form of FORM GST DRC-22.

2.3 It has been brought to notice that there is a confusion among the concerned revenue authorities,
transport authorities, bankers and other such authorities as to whether the said encumbrance placed on
the said movable or immovable property automatically expires after a period of one year from the date
of FORM GST DRC – 22, or the said authorities have to wait for a written instructions from the
Commissioner to that effect.

2.4 In this regard, it is to be noted that in the case of 'M/s Balaji Enterprises vs Principal Additional
Director General, Directorate General of GST Intelligence, the Hon’ble High Court of Delhi, in its
order dated 11.07.2023 has mentioned the following:

“2. We find that there are a large number of matters where the orders freezing the bank
accounts under Section 83 of the Central Goods and Service Tax Act, 2017 (hereafter ‘the
CGST Act’) have elapsed in terms of the Section 83(2) of the CGST Act, but the bankers are
not permitting the operation of the bank accounts for want of further communication from the
Department.
3. Clearly, the tax payers are not required to run from pillar to post for resuming the
operation of the bank accounts, which were interdicted by the orders that are no longer
operative. Prima facie, we are of view that the concerned officer freezing the bank account
under Section 83 of the CGST Act is also obliged to communicate to the concerned bank that
the said order is no longer operative, once the period of one year has elapsed.
4. Clearly, a procedure is required to be adopted to obviate any such petitions or
applications.”


3. It has been observed that as Section 83(2) of CGST Act, 2017 clearly provides that the
provisional attachment shall cease to have effect after the expiry of a period of one year from the date
of the provisional attachment order (i.e. order in FORM GST DRC-22), putting any requirement of
issuance of order for release of the provisionally attached property in FORM GST DRC-23 by the
Commissioner may not only add to procedural requirements/ compliances but may also further delay
the release of such provisionally attached property even after completion of period of one year. In view
of this, it is proposed that amendment may be made in Rule 159(2) of CGST Rules, 2017 and FORM
GST DRC-22 instead, to clearly provide that order issued under FORM GST DRC-22 shall cease to
have effect after expiry of period of one year from the date of issuance.

4.1 The matter was deliberated by the Law Committee in its meeting held on 21.09.2023, wherein
the Law Committee recommended amendment in sub-rule (2) of Rule 159 of CGST Rules, 2017, as
mentioned below, so as to remove any doubts in the process of removing the encumbrance placed on
the provisionally attached property after the expiry of the statutory period of one year from the date of
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issuance of the order in the form of FORM GST DRC – 22, in accordance with the provisions of section
83(2) of CGST Act, 2017.
Rule 159. Provisional attachment of property. –
..
(2) The Commissioner shall send a copy of the order of attachment in FORM GST
DRC-22 to the concerned Revenue Authority or Transport Authority or any such Authority to
place encumbrance on the said movable or immovable property, which shall be removed only
on the written instructions from the Commissioner to that effect, or on expiry of a period of one
year from the date of issuance of order in FORM GST DRC-22, whichever is earlier, and a
copy of such order shall also be sent to the person whose property is being attached under
section 83.
..

4.2 The Law Committee also proposed making amendment in FORM GST DRC-22 as mentioned
in Annexure-A.

5. The recommendations of the Law Committee as detailed in para 4.1 and 4.2 above are placed
before the GST Council for approval.
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Annexure-A
[FORM GST DRC -22]
[See rule 159(1)]
Reference No.:
Date:
To
---------------------------------------------------------------------Name
---------------------------------------------------------------------Address
(Bank/ Post Office/Financial Institution/Immovable property registering authority/ Regional
Transport Authority/Other Relevant Authority)

Provisional attachment of property under section 83

It is to inform that M/s------------------------------------------(name) having principal place of business at
------------------(address) bearing registration number as --------------(GSTIN/ID), PAN is a registered
taxable person under the <<SGST/CGST>> Act.
Or

It is to inform that Sh………………………….(name) resident of …………………… (address)
bearing PAN -----------------------------------------------------and/or Aadhaar No is a person specified
under sub-section (1A) of Section 122 .

Proceedings have been launched against the aforesaid person under section << >> of the said Act to
determine the tax or any other amount due from the said person. As per information available with the
department, it has come to my notice that the said person has a –
<<saving / current / FD/RD / depository >>account in your << bank/post office/financial institution>>
having account no. << A/c no. >>;
or
property located at << property ID & location>>.
or
Vehicle No. ---------------------------------------------------------- <<description>>
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or
Others (please specify)-------------------------------------------<<description>>

In order to protect the interests of revenue and in exercise of the powers conferred under section 83 of
the Act, I ------------------------------------------------------ (name), ----------------------------- (designation),
hereby provisionally attach the aforesaid account / property.

No debit shall be allowed to be made from the said account or any other account operated by the
aforesaid person on the same PAN without the prior permission of this department.
or
The property mentioned above shall not be allowed to be disposed of without the prior permission of
this department.

This order shall cease to have effect, on the date of issuance of order in FORM GST DRC-23 by the
Commissioner, or on the expiry of a period of one year from the date of issuance of this order, whichever
is earlier.

Signature
Name
Designation

Copy to (person)

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Agenda Item 3(vi): Clarification on various issues related to Place of Supply.

A. Clarification regarding place of supply of services of transportation of goods by mail or courier
when either supplier or recipient of service is located outside India

1.1 The GST Council in its 49th meeting held on February 18, 2023, vide Agenda Item 4(iii)
“Change in Place of Supply of transportation of goods under Section 13(9) of the IGST Act,
2017”(Appendix X) had approved to rationalize the provisions relating to the place of supply of
services of transportation of goods by deleting sub-section(9) of section 13 of the Integrated Goods and
Services Tax Act, 2017 (‘IGST Act’) so as to provide that the place of supply of services of
transportation of goods, in cases where location of supplier of services or location of recipient of
services is outside India, shall be determined by the default route under sub-section (2) of section 13 of
IGST Act, i.e. location of the recipient of services. Accordingly, sub-section (9) of section 13 of IGST
Act was omitted vide section 162 of Finance Act, 2023. After the said amendment, the place of supply
of services of transportation of goods will be governed by the provisions of sub-section (2) of section
13. The relevant extract of the said sub-section is reproduced below:
“(2) The place of supply of services except the services specified in sub-sections (3) to (13) shall
be the location of the recipient of services:

Provided that where the location of the recipient of the services is not available in the ordinary
course of business, the place of supply shall be the location of the supplier of the services.”

1.2 Representations have been received seeking clarification regarding the place of supply in
respect of transportation of goods by way of mail or courier. It has been represented that the
abovementioned amendment in section 13 of IGST Act addresses only a situation where there is
transportation of goods other than by way of mail or courier. It has been mentioned that the intent of
the said amendment appears to rationalize the place of supply of services provisions relating to all types
of transportation of goods (including mail and courier). It has been represented that many field
formations are taking the view that the place of supply in case of transport of goods by mail or courier
would be the location where the services are actually wholly or partly performed, because the recipient
makes the goods or time-sensitive documents available to the courier agency or mail service provider
in India for the transportation. As per, Section 13(3)(a) of the IGST Act, the place of supply of services
in case where services are supplied in respect of goods which are required to be made physically
available by the recipient of services to the supplier of services, would be where the services are actually
performed. Further, as per section 13(6) of IGST Act, where any service referred in section 13(3) of
IGST Act is supplied at more than one location, including a location in taxable territory, place of supply
shall be the location in the taxable territory. This interpretation is resulting in place of supply of the
services for transportation of goods by way of mail and courier in India, even if recipient of the services
is located outside India.

1.3 The matter has been examined. The intent of the GST Council behind the amendment in section 13
of IGST Act was to rationalize the provision of place of supply for services of transportation of goods
by deletion of sub-section (9) so as to provide that the place of supply of services of transportation of
goods, in cases where location of supplier of services or location of recipient of services is outside India,
shall be determined as per sub-section (2) of section 13 of IGST Act, i.e. the location of the recipient of
services. It is to be noted that the nature of service, whose place of supply is in question, is transportation
Agenda for 52nd GSTCM Volume 1
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of goods. It may be immaterial whether the mode of transportation is by mail or courier or any other
means. In case of transportation of goods, both in cases by way of mail or courier, as well as in cases
other than by way of mail or courier, the nature of supply inherently remains the same. The mode of
determination of place of supply in all the cases of supply of services of transportation of goods remains
the same, as there is no other specific provision in section 13 to differentiate the place of supply in case
of mail or courier and other than mail or courier. Thus, it may not be legally correct to provide for
different place of supply of the same service just because the mode of transportation is different. As the
Council has already taken a view in 49th meeting that place of supply of services of transportation of
goods, in cases where location of supplier of services or location of recipient of services is outside India,
shall be determined as per sub-section (2) of section 13 of IGST Act, i.e. the location of the recipient of
services, the same principle for determination of place of supply should be applicable in case of supply
of transportation of goods by way of mail or courier also. Thus, the place of supply in such cases of
service of transportation of goods through mail and courier is to be determined by the same provision
as the service of transportation of goods other than mail and courier i.e. section 13(2) of the IGST Act.

1.4 In light of the above issue, Law Committee in its meeting held on 31.08.2023/ 01.09.2023 and
21.09.2023 recommended that a Circular may be issued to clarify that for transportation of goods,
including by way of mail or courier, in all cases where location of supplier of services or location of
recipient of services is outside India, the place of supply is to be determined as per sub-section (2) of
section 13 of the IGST Act. This shall help in aligning the treatment for transportation of goods (other
than by way of mail and courier), as intended under the GST council recommendation, with that of
transportation of goods by way of mail or courier services in case where supplier or recipient is located
outside India and remove any ambiguities that may arise in interpretation or otherwise.


B. Clarification regarding place of supply for services in respect of advertising sector

2.1 Reference has been received from field formations highlighting the issue of place of supply in
case of advertising sector and seeking clarification on the same. As per the representation-
(i) The advertising companies (“advertisers”) are involved in procuring space on hoardings/
bill boards erected and mounted on buildings/land, in different States, from various
suppliers (“vendors”) for providing advertisement services to its corporate clients.
(ii) The inward supply of procuring space on hoardings/billboards by the advertising
companies from its vendors, is in relation to immovable property, the place of supply for
such inward supply should, therefore, in the light of Section 12(3) of the IGST Act, 2017,
be location at which the immovable property is located. Thus, the vendors providing such
supplies to the advertising companies, which is intra-State supply as per Section 8(2) of the
IGST Act, 2017, are required to pay CGST & SGST and not IGST. The advertising
companies are often located and registered outside the State in which supply has been made
so they cannot claim ITC of CGST & SGST.
(iii) The advertising companies are however considering such supplies as inter-State supply
under Section 12(2) of the IGST Act, 2017, on the basis of a clarification provided by the
Sectoral Group for Media and Entertainment (attached as Appendix-Y). The vendors of
advertising companies are paying IGST on such services provided to the advertising
companies and ITC of such IGST is, accordingly, being availed/ utilized by the advertising
company.
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(iv) Thus, it has been requested to issue a clarification on the place of supply of abovementioned
services given by vendors to advertising companies.

2.2 The matter has been examined. There may be variety of arrangements between the advertising
company and its vendors:
(i) There may be a case wherein there is supply (sale) of space on the hoarding/ structure
(immovable property) belonging to vendor to the client/advertising company for display of their
advertisement on the said hoarding/ structure. This would amount to supply of services of sale
of other advertising space or time (SAC:998366). There may also be cases where there is supply
(sale) of rights to use the hoarding/structure (immovable property) belonging to vendor to the
advertising company. This would amount to supply by way of grant of rights to use immovable
property (SAC:997212). The hoarding/structure erected on the land should be considered as
immovable structure or fixture as it has been embedded in earth. As per the definition of
immovable property in Section 3(26) of the General Clauses Act, immovable property includes
land, benefits to arise out of land, and things attached to earth, or permanently fastened to
anything attached to the earth. Thus, the hoarding as a thing attached to the earth, falls within
the definition of immovable property. Further, place of supply of any service provided by way
of supply (sale) of space on an immovable property or grant of rights to use an immovable
property shall be governed by the provisions of section 12(3)(a) of IGST Act. As per section
12(3)(a) of IGST Act, the place of supply of services directly in relation to an immovable
property, including services provided by architects, interior decorators, surveyors, engineers
and other related experts or estate agents, any service provided by way of grant of rights to use
immovable property or for carrying out or co-ordination of construction work shall be the
location at which the immovable property is located. Therefore, the place of supply of service
provided by way of supply of sale of space on hoarding/ structure for advertising or for grant
of rights to use the hoarding/ structure for advertising in this case would be the location where
such hoarding/ structure is located.
(ii) There may be case where the advertising company wants to display its advertisement on
hoardings/ bill boards at a specific location availing the services of a vendor. The responsibility
of arranging the hoardings/ bill boards lies with the vendor who may himself own such structure
or may be taking it on rent or rights to use basis from another person. The vendor is responsible
for display of the advertisement of the advertisement company at the said location. During this
entire time of display of the advertisement, the advertising agency is not occupying the space
or the structure but it is the vendor who is in continuous and undisturbed possession of the
space. Thus, the vendor is providing advertisement services to his client (advertising agency)
and it is immaterial whether it is displayed on movable or immovable property. As there is no
supply (sale) of space on the hoarding/ structure (immovable property) belonging to vendor to
the client for display of their advertisement on the said display board/structure, it does not
amount to sale of advertising space. Also, as there is no supply (sale) of rights to use the
structure (immovable property) belonging to vendor to the other person to use for any purpose,
it does not amount to supply by way of grant of rights to use immovable property. Vendor is in
fact providing advertisement services by providing visibility to an Advertiser's advertisement
for a specific period of time on his structure which is located at a specific place. Therefore, such
services provided by the Vendor to Advertiser are purely in the nature of advertisement services
Agenda for 52nd GSTCM Volume 1
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in respect of which Place of Supply should be determined in terms of Section 12(2) of IGST
Act, 2017 according to which place of recipient (Advertiser) is the Place of Supply and nature
of transaction as to whether inter-state or intra-state shall be decided accordingly.
2.3 Accordingly, Law Committee in its meeting held on 31.08.2023/ 01.09.2023 and 21.09.2023
recommended that a Circular may be issued to clarify the issue of place of supply in the advertising
sector on lines of para 2.2 above.
B. Clarification regarding place of supply for services in respect of advertising sector

3.1 Co-location is a data center facility in which a business/company can rent space for its own
servers and other computing hardware along with various other bundled services related to Hosting and
information technology (IT) infrastructure. A business/company who avails the co-location services
primarily seek security and upkeep of its server/s, storage and network hardware; operating systems,
system software and may require to interact with the system through a web-based interface for the
hosting of its websites or other applications and operation of the servers.
3.2 Representations have been received from the trade and field formations seeking clarification
on certain issues with respect to determination of place of supply in case of supply of the “co-location
services”. In this respect, various doubts have been raised as to whether supply of co-location services
are renting of immovable property service (as it involves renting of space for keeping/storing company’s
hardware/servers) and hence the place of supply of such services is to be determined in terms of
provision of clause (a) of sub-section (3) of Section 12 of the IGST Act which is the location where the
immovable property is located or whether the place of supply of such services is to be determined by
the default place of supply provision under sub-section (2) of section 12 of the IGST Act as the supply
of service is Hosting and Information Technology (IT) Infrastructure Provisioning services involving
providing services of hosting the servers and related hardware, security of the said hardware, air
conditioning, uninterrupted power supply, fire protection system, network connectivity, backup facility,
firewall services, 24 hour monitoring and surveillance service for ensuring continuous operations of the
servers and related hardware, etc.
3.3 The matter has been examined. Co-location services are in the nature of “Hosting and
information technology (IT) infrastructure provisioning services” (S.No. 3 of Explanatory notes of
SAC-998315). Such services do not appear to be limited to the passive activity of making immovable
property available to a customer as the arrangement of the supply of colocation services not only
involves providing of a physical space for server/network hardware along with air conditioning,
security service, fire protection system and power supply but it also involves the supply of various
services by the supplier related to hosting and information technology infrastructure services like
network connectivity, backup facility, firewall services, and monitoring and surveillance service for
ensuring continuous operations of the servers and related hardware, etc. which are essential for the
recipient business/company to interact with the system through a web based interface relating to the
hosting and operation of the servers. In such cases, supply of colocation services cannot be considered
as the services of supply of renting of immovable property. Therefore, the place of supply of the
colocation services shall not be determined by the provisions of clause (a) of sub-section (3) of Section
12 of the IGST Act but the same shall be determined by the default place of supply provision under
sub-section (2) of Section 12 of the IGST Act i.e. location of recipient of co-location service. However,
in cases where the agreement between the supplier and the recipient is restricted to providing physical
Agenda for 52nd GSTCM Volume 1
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space on rent along with basic infrastructure, without components of Hosting and Information
Technology (IT) Infrastructure Provisioning services and the further responsibility of upkeep, running,
monitoring and surveillance, etc. of the servers and related hardware is of recipient of services only,
then the said supply of services shall be considered as the supply of the service of renting of immovable
property. Accordingly, the place of supply of these services shall be determined by the provisions of
clause (a) of sub-section (3) of Section 12 of the IGST Act which is the location where the immovable
property is located.
3.4 The issue was deliberated by the Law Committee in its meeting held on 31.08.2023 and
01.09.2023, wherein the Law Committee recommended that the place of supply in case of supply of the
“co-location services” may be clarified through the circular on lines of para 3.3 above.
4. The draft circular to clarify the above issues pertaining to place of supply, as recommended by
the Law Committee, is attached as Annexure-A.
5. Accordingly, the agenda note is placed before the GST Council for deliberation and approval.

Agenda for 52nd GSTCM Volume 1
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Annexure-A
F. No. CBIC-XX/XX/XXXX-GST
Government of India
Ministry of Finance (Department of Revenue)
Central Board of Indirect Taxes & Customs,
GST Policy Wing
*****
New Delhi, dated the XX, 2023
To,
The Principal Chief Commissioners / Chief Commissioners / Principal Commissioners /
Commissioners of Central Tax and Central Tax (Audit) (All)
The Principal Directors General / Directors General (All)

Madam/Sir,
Subject: Clarification regarding determination of place of supply in various cases-reg.
Representations have been received from the trade and field formations seeking clarification on certain
issues with respect to determination of place of supply in case of –
i. supply of service of transportation of goods, including through mail and courier;
ii. supply of services in respect of advertising sector; and
iii. supply of the “co-location services”.
2. In order to clarify the issue and to ensure uniformity in the implementation of the provisions
of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of
the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”), hereby
clarifies the issues as under:

S.No. Issue Clarification
A. Place of supply in case of supply of service of transportation of goods, including through
mail and courier
1. Sub-section (9) of section 13 of Integrated
Goods and Services Tax Act, 2017
(hereinafter referred to as “IGST Act”) has
been omitted vide section 162 of Finance
1.1 Place of supply of services where
location of supplier or location of recipient
is outside India is determined as per section
13 of the IGST Act. Sub-section (9) of
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Act, 2023 which will come into effect from
01.10.2023. After the said amendment,
doubts have raised as to whether the place
of supply in case of service of
transportation of goods, including through
mail and courier, in cases where location of
supplier of services or location of recipient
of services is outside India, will be
determined as per sub-section (2) of
section 13 of IGST Act or will be
determined as per sub-section (3) of
section 13 of IGST Act.
section 13 of IGST Act provided that where
one of the supplier of the services or the
recipient of services is located outside India,
the place of supply of services of
transportation of goods, other than by way
of mail or courier, shall be the place of
destination of such goods. The said sub-
section has been omitted vide section 162 of
Finance Act, 2023 which will come into
effect from 01.10.2023. It is hereby clarified
that after the said amendment comes into
effect, the place of supply of services of
transportation of goods, other than through
mail and courier, in cases where location of
supplier of services or location of recipient
of services is outside India, will be
determined by the default rule under section
13(2) of IGST Act and not as performance
based services under sub-section (3) of
section 13 of IGST Act. Accordingly, in
cases where location of recipient of services
is available, the place of supply of such
services shall be the location of recipient of
services and in cases where location of
recipient of services is not available in the
ordinary course of business, the place of
supply shall be the location of supplier of
services.

1.2 Further, it is also mentioned that the
place of supply in case of service of
transportation of goods by mail or courier
was not covered under the provisions of
sub-section (9) of section 13 before the said
sub-section was amended/omitted.
Therefore, on the same principles as
mentioned above, the place of supply in case
of service of transportation of goods by mail
or courier will continue to be determined by
the default rule under section 13(2) of IGST
Act i.e. in cases where location of recipient
of services is available, the place of supply
of such services shall be the location of
recipient of services and in cases where
location of recipient of services is not
available in the ordinary course of business,
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the place of supply shall be the location of
supplier of services.
B. Place of supply in case of supply of services in respect of advertising sector
2. Advertising companies are often involved
in procuring space on hoardings/ bill
boards erected and mounted on
buildings/land, in different States, from
various suppliers (“vendors”) for providing
advertisement services to its corporate
clients. There may be variety of
arrangements between the advertising
company and its vendors as below:
(i) There may be a case wherein there is
supply (sale) of space or supply (sale) of
rights to use the space on the hoarding/
structure (immovable property) belonging
to vendor to the client/advertising company
for display of their advertisement on the
said hoarding/ structure. What will be the
place of supply of services provided by the
vendor to the advertising company in such
case?

(ii) There may be another case where the
advertising company wants to display its
advertisement on hoardings/ bill boards at
a specific location availing the services of
a vendor. The responsibility of arranging
the hoardings/ bill boards lies with the
vendor who may himself own such
structure or may be taking it on rent or
rights to use basis from another person.
The vendor is responsible for display of the
advertisement of the advertisement
company at the said location. During this
entire time of display of the advertisement,
the vendor is in possession of the
hoarding/structure at the said location on
which advertisement is displayed and the
advertising company is not occupying the
space or the structure.
2.1 It is clarified that the place of supply in
the case supply of services in respect of
advertising sector, in the cases referred in (i)
and (ii), shall be determined as below:

2.2 Place of supply in Case (i): The
hoarding/structure erected on the land
should be considered as immovable
structure or fixture as it has been embedded
in earth. Further, place of supply of any
service provided by way of supply (sale) of
space on an immovable property or grant of
rights to use an immovable property shall be
governed by the provisions of section
12(3)(a) of IGST Act. As per section
12(3)(a) of IGST Act, the place of supply of
services directly in relation to an immovable
property, including services provided by
architects, interior decorators, surveyors,
engineers and other related experts or estate
agents, any service provided by way of grant
of rights to use immovable property or for
carrying out or co-ordination of
construction work shall be the location at
which the immovable property is located.
Therefore, the place of supply of service
provided by way of supply of sale of space
on hoarding/ structure for advertising or for
grant of rights to use the hoarding/ structure
for advertising in this case would be the
location where such hoarding/ structure is
located.

2.3 Place of supply in Case (ii): In this
case, as the service is being provided by the
vendor to the advertising company and there
is no supply (sale) of space/ supply (sale) of
rights to use the space on hoarding/structure
(immovable property) by the vendor to the
advertising company for display of their
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In this case, what will be the place of
supply of such services provided by the
vendor to the advertising company?
advertisement on the said display
board/structure, the said service does not
amount to sale of advertising space or
supply by way of grant of rights to use
immovable property. Accordingly, the place
of supply of the same shall not be covered
under section 12(3)(a) of IGST Act. Vendor
is in fact providing advertisement services
by providing visibility to an advertising
company’s advertisement for a specific
period of time on his structure
possessed/taken on rent by him at the
specified location. Therefore, such services
provided by the Vendor to advertising
company are purely in the nature of
advertisement services in respect of which
Place of Supply shall be determined in terms
of Section 12(2) of IGST Act.
C. Place of supply in case of supply of the “co-location services”
3. Co-location is a data center facility in
which a business/company can rent space
for its own servers and other computing
hardware along with various other bundled
services related to Hosting and information
technology (IT) infrastructure.
A business/company who avails the co-
location services primarily seek security
and upkeep of its server/s, storage and
network hardware; operating systems,
system software and may require to
interact with the system through a web-
based interface for the hosting of its
websites or other applications and
operation of the servers.
In this respect, various doubts have been
raised as to
i. whether supply of co-location
services are renting of immovable
property service (as it involves
renting of space for keeping/storing
company’s hardware/servers) and
hence the place of supply of such
services is to be determined in terms
of provision of clause (a) of sub-
3.1 It is clarified that the Co-location
services are in the nature of “Hosting and
information technology (IT) infrastructure
provisioning services” (S.No. 3 of
Explanatory notes of SAC-998315). Such
services do not appear to be limited to the
passive activity of making immovable
property available to a customer as the
arrangement of the supply of colocation
services not only involves providing of a
physical space for server/network hardware
along with air conditioning, security
service, fire protection system and power
supply but it also involves the supply of
various services by the supplier related to
hosting and information technology
infrastructure services like network
connectivity, backup facility, firewall
services, and monitoring and surveillance
service for ensuring continuous operations
of the servers and related hardware, etc.
which are essential for the recipient
business/company to interact with the
system through a web based interface
relating to the hosting and operation of the
servers.
Agenda for 52nd GSTCM Volume 1
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section (3) of Section 12 of the IGST
Act which is the location where the
immovable property is located; or
whether the place of supply of such
services is to be determined by the default
place of supply provision under sub-
section (2) of section 12 of the IGST Act as
the supply of service is Hosting and
Information Technology (IT)
Infrastructure Provisioning services
involving providing services of hosting the
servers and related hardware, security of
the said hardware, air conditioning,
uninterrupted power supply, fire protection
system, network connectivity, backup
facility, firewall services, 24 hrs.
monitoring and surveillance service for
ensuring continuous operations of the
servers and related hardware, etc.

3.2 In such cases, supply of colocation
services cannot be considered as the
services of supply of renting of immovable
property. Therefore, the place of supply of
the colocation services shall not be
determined by the provisions of clause (a) of
sub-section (3) of Section 12 of the IGST
Act but the same shall be determined by the
default place of supply provision under sub-
section (2) of Section 12 of the IGST Act i.e.
location of recipient of co-location service.

3.3 However, in cases where the agreement
between the supplier and the recipient is
restricted to providing physical space on
rent along with basic infrastructure, without
components of Hosting and Information
Technology (IT) Infrastructure Provisioning
services and the further responsibility of
upkeep, running, monitoring and
surveillance, etc. of the servers and related
hardware is of recipient of services only,
then the said supply of services shall be
considered as the supply of the service of
renting of immovable property.
Accordingly, the place of supply of these
services shall be determined by the
provisions of clause (a) of sub-section (3) of
Section 12 of the IGST Act which is the
location where the immovable property is
located.

3. Difficulty, if any, in implementation of the above instructions may please be brought to the notice of
the Board. Hindi version would follow.

(Sanjay Mangal)
Principal Commissioner (GST)


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Agenda Item 3(vii): Agenda Note for issuance of clarification relating to export of services-
condition (iv) of the Section 2 (6) of the IGST Act 2017.
References have been received from trade and industry associations requesting for clarification
regarding admissibility of export remittances received in Special INR Vostro account, as permitted by
RBI, for the purpose of consideration of supply of services as export of services as per provisions of
clause (6) of section 2 of IGST Act, 2017. They have further stated that Export remittances realized in
INR into Special Vostro accounts are being denied by some of the tax authorities by taking a view that
the remittances received by taxpayer in ‘INR’ in such Vostro accounts are not permitted by RBI. In
view of this, refunds of ITC are being denied to the exporters by such tax authorities claiming that the
said exporter has not realized export proceeds in convertible foreign exchange and accordingly, the
conditions for qualifying as export under clause (6) of section 2 of IGST Act, 2017 are not fulfilled.
Requests have been made for issuance of a circular to clarify this issue.
2. The matter has been examined in light of extant GST provisions, RBI Circulars and Foreign
Trade Policy, 2023, and is discussed in the following paras.
3. Export of services has been defined under clause (6) of section 2 of IGST Act, 2017. As per the
said definition, any supply of services needs to fulfill five conditions for it to qualify as export of
services. Clause (6) of section 2 of the IGST Act 2017 is reproduced below for reference:
“(6) “export of services” means the supply of any service when, –
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible
foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct
person in accordance with Explanation 1 in section 8;”

3.1 One of the conditions mentioned in sub-clause (iv) of Section 2(6) of the IGST Act, 2017 is
that the payment for such service has been received by the supplier of service in convertible foreign
exchange or in Indian rupees wherever permitted by the Reserve Bank of India.
4. Reference is invited to RBI’s A.P. (DIR Series) Circular No.10 dated 11th July, 2022
regarding International Trade Settlement in Indian Rupees (INR), wherein it has been clarified
that to promote growth of global trade with emphasis on exports from India and to support the increasing
interest of global trading community in INR, it has been decided to put in place an additional
arrangement for invoicing, payment, and settlement of exports / imports in INR. Before putting in
place this mechanism, AD banks shall also require prior approval from the Foreign Exchange
Department of Reserve Bank of India, Central Office at Mumbai. Para 3 of the Circular is reproduced
below:
“3. In terms of Regulation 7(1) of Foreign Exchange Management (Deposit) Regulations,
2016, AD banks in India have been permitted to open Rupee Vostro Accounts. Accordingly, for
settlement of trade transactions with any country, AD bank in India may open Special Rupee
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Vostro Accounts of correspondent bank/s of the partner trading country. In order to allow
settlement of international trade transactions through this arrangement, it has been decided that:
(a) Indian importers undertaking imports through this mechanism shall make payment in INR
which shall be credited into the Special Vostro account of the correspondent bank of the partner
country, against the invoices for the supply of goods or services from the overseas seller
/supplier.
(b) Indian exporters, undertaking exports of goods and services through this mechanism, shall
be paid the export proceeds in INR from the balances in the designated Special Vostro account
of the correspondent bank of the partner country.”
4.1 This essentially implies that RBI has put in place an additional arrangement for invoicing,
payment, and settlement of exports / imports in INR through Special Rupee Vostro Accounts opened
by Authorised Dealer Banks of correspondent bank(s) of the partner trading country, subject to
conditions stipulated under Regulation 7(1) of Foreign Exchange Management (Deposit) Regulations,
2016 for opening of such accounts.
5. Reference is further invited to the Foreign Trade Policy (FTP) 2023, which has come into force
from 01.04.2023, wherein Para 2.52 (d) of chapter relating to General Provisions Regarding Imports
and Exports specifies that:
Para 2.52 (d) Invoicing, payment and settlement of exports and imports is also permissible
in INR subject to compliances as under RBI’s A.P. (DIR Series) Circular No.10 dated 11th
July, 2022. Accordingly, settlement of trade transactions in INR shall take place through the
Special Rupee Vostro Accounts opened by AD banks in India as permitted under Regulation
7(1) of Foreign Exchange Management (Deposit) Regulations, 2016, in accordance to the
following procedures:
(i) Indian importers undertaking imports through this mechanism shall make payment in
INR which shall be credited into the Special Vostro account of the correspondent bank of
the partner country, against the invoices for the supply of goods or services from the
overseas seller /supplier
(ii) Indian exporters, undertaking exports of goods and services through this
mechanism, shall be paid the export proceeds in INR from the balances in the designated
Special Vostro account of the correspondent bank of the partner country.
5.1 Thus, the relevant provisions of the Foreign Trade Policy (FTP) 2023 also reiterate that export
of services can take place through the mechanism put in place regarding Special Rupee Vostro Account
subject to compliances mandated under RBI’s A.P. (DIR Series) Circular No.10 dated 11th July, 2022.
6. In view of the above, on perusal of the aforesaid provisions of RBI’s A.P. (DIR Series) Circular
No.10 dated 11th July, 2022 & Para 2.52 (d) of the Foreign Trade Policy (FTP) 2023, it appears that
the conditions of sub-clause (iv) of Section 2(6) of the IGST Act, 2017, which requires that for a supply
of service to qualify as export of service, the payment for such service should be received by the supplier
of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank
of India, appear to be fulfilled when the Indian exporters, undertaking exports of services, are paid the
export proceeds in INR from the balances in the designated Special Vostro Account of the
correspondent bank of the partner trading country in terms of Regulation 7(1) of Foreign Exchange
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Management (Deposit) Regulations, 2016, as mandated by RBI’s A.P. (DIR Series) Circular No.10
dated 11th July, 2022 and reiterated further in Foreign Trade Policy, 2023.
7. Law Committee deliberated on the issue in its meeting held on 31.08.2023 and 01.09.2023 and
recommended that the issue may be clarified through a circular as above.
8. The draft circular, as recommended by the Law Committee, incorporating the clarification is
enclosed at Annexure-A to this agenda note.

9. The agenda is placed before the GST Council for deliberation and approval.
Agenda for 52nd GSTCM Volume 1
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ANNEXURE-A
CIRCULAR NO. XXX/XX/2023-GST
CBIC-20016/20/2023-GST-SECTION-CBEC
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
******
New Delhi, the , 2023
To

The Pr. Chief Commissioners / Chief Commissioners / Principal Commissioners / Commissioners of
Central Tax (All)
The Principal Director Generals / Director Generals (All)

Madam / Sir,

Subject: Clarification relating to export of services – sub-clause (iv) of the Section 2 (6) of the
IGST Act 2017–reg.

Various representations have been received requesting for clarification regarding admissibility
of export remittances received in Special INR Vostro account, as permitted by RBI, for the purpose of
consideration of supply of services to qualify as export of services as per the provisions of clause (6) of
section 2 of the Integrated Goods & Services Tax Act, 2017 (herein after referred to as the ‘IGST Act”).

2. The issue has been examined and to ensure uniformity in the implementation of the provisions
of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1)
of the Central Goods & Services Tax Act, 2017 (herein after referred to as the ‘CGST Act”), hereby
clarifies the issue as under:

3. Relevant legal provisions:

3.1 Export of services has been defined under clause (6) of section 2 of IGST Act. As per the said
definition, any supply of services needs to fulfill five conditions for it to qualify as export of services.
Clause (6) of section 2 of the IGST Act is reproduced below for reference:
“(6) “export of services” means the supply of any service when, –
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible
foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct
person in accordance with Explanation 1 in section 8;”
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3.2 One of the conditions mentioned in sub-clause (iv) of Section 2(6) of the IGST Act is that the
payment for such service has been received by the supplier of service in convertible foreign exchange
or in Indian rupees wherever permitted by the Reserve Bank of India.
3.3 Reference is invited to RBI’s A.P. (DIR Series) Circular No.10 dated 11th July, 2022
regarding International Trade Settlement in Indian Rupees (INR), vide which it has been clarified
that to promote growth of global trade with emphasis on exports from India and to support the increasing
interest of global trading community in INR, it has been decided to put in place an additional
arrangement for invoicing, payment, and settlement of exports / imports in INR. Before putting in
place this mechanism, AD banks shall require prior approval from the Foreign Exchange Department
of Reserve Bank of India, Central Office at Mumbai. Para 3 of the Circular is reproduced below:
“3. In terms of Regulation 7(1) of Foreign Exchange Management (Deposit) Regulations,
2016, AD banks in India have been permitted to open Rupee Vostro Accounts. Accordingly, for
settlement of trade transactions with any country, AD bank in India may open Special Rupee
Vostro Accounts of correspondent bank/s of the partner trading country. In order to allow
settlement of international trade transactions through this arrangement, it has been decided that:
(a) Indian importers undertaking imports through this mechanism shall make payment in INR
which shall be credited into the Special Vostro account of the correspondent bank of the partner
country, against the invoices for the supply of goods or services from the overseas seller
/supplier.
(b) Indian exporters, undertaking exports of goods and services through this mechanism, shall
be paid the export proceeds in INR from the balances in the designated Special Vostro account
of the correspondent bank of the partner country.”

3.4 Reference is also invited to Para 2.52 (d) of chapter related to General Provisions Regarding
Imports and Exports of the Foreign Trade Policy (FTP) 2023, which has come into force from
01.04.2023, which specifies that:
Para 2.52 (d) Invoicing, payment and settlement of exports and imports is also permissible
in INR subject to compliances as under RBI’s A.P. (DIR Series) Circular No.10 dated 11th
July, 2022. Accordingly, settlement of trade transactions in INR shall take place through the
Special Rupee Vostro Accounts opened by AD banks in India as permitted under Regulation
7(1) of Foreign Exchange Management (Deposit) Regulations, 2016, in accordance to the
following procedures:
(i) Indian importers undertaking imports through this mechanism shall make payment in
INR which shall be credited into the Special Vostro account of the correspondent bank of
the partner country, against the invoices for the supply of goods or services from the
overseas seller /supplier
(ii) Indian exporters, undertaking exports of goods and services through this
mechanism, shall be paid the export proceeds in INR from the balances in the designated
Special Vostro account of the correspondent bank of the partner country.
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3.5 On perusal of the above, it can be stated that the condition(s) of sub-clause (iv) of Section 2(6)
of the IGST Act, 2017, can be considered to be fulfilled when the Indian exporters, undertaking exports
of services, are paid the export proceeds in INR from the balances in the designated Special Vostro
Account of the correspondent bank of the partner trading country in terms of Regulation 7(1) of Foreign
Exchange Management (Deposit) Regulations, 2016, as mandated by RBI’s A.P. (DIR Series) Circular
No.10 dated 11th July, 2022 and reiterated further in Foreign Trade Policy, 2023.
4. Therefore, it is clarified that when the Indian exporters, undertaking export of services, are paid
the export proceeds in INR from the Special Rupee Vostro Accounts of correspondent bank(s) of the
partner trading country, opened by AD banks, the same shall be considered to be fulfilling the conditions
of sub-clause (iv) of clause (6) of section 2 of IGST Act, 2017, subject to the conditions/ restrictions
mentioned in Foreign Trade Policy, 2023 & extant RBI Circulars and without prejudice to the
permissions / approvals, if any, required under any other law .
5. It is requested that suitable trade notices may be issued to publicize the contents of this
Circular. Difficulty, if any, in the implementation of this Circular may be brought to the notice of the
Board. Hindi version will follow.



(Sanjay Mangal)
Principal Commissioner



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Agenda Item 3(viii): Amendment in Central Goods and Services Tax Rules, 2017 and GST
REG/PCT – FORM(s)
A. Incorporation of ‘One Person Company’ in FORM GST REG 01 i.e. Application for
Registration
1.1 While applying for Registration, an applicant is required to select ‘Constitution of Business’
from dropdown in Part B of FORM GST REG-01 i.e. Application for Registration. Following are the
categories for ‘Constitution of Business’ in the dropdown of Part B of FORM GST REG-01.
(i) Proprietorship
(ii) Partnership
(iii) Hindu Undivided Family
(iv) Private Limited Company
(v) Public Limited Company
(vi) Society/Club/Trust/Association of Persons
(vii) Government Department
(viii) Public Sector Undertaking
(ix) Unlimited Company
(x) Limited Liability Partnership
(xi) Local Authority
(xii) Statutory Body
(xiii) Foreign Limited liability Partnership
(xiv) Foreign Company Registered (In India)
(xv) Others
In case, the business does not fall in any of the specified categories of ‘Constitution of Business’
then applicant may choose ‘others’ as the category.
1.2 After selecting constitution of business, in the existing system, applicant has to add at least one
partner/promoter (Primary Authorised Signatory) in tab of business category. Recently, a change has
been introduced in the system, whereby it has been made mandatory for applicant to update minimum
two Partners/Promoters, if he selects either of the following categories of “Constitution of Business”:
(i) Foreign Company
(ii) Foreign Limited liability Partnership
(iii) Limited Liability Partnership
(iv) Partnership
Agenda for 52nd GSTCM Volume 1
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(v) Private Limited Company
(vi) Public Limited Company
(vii) Public Sector Undertaking
(viii) Society/Club/Trust/Association of Persons
(ix) Unlimited Company
With this new change in portal, in case an applicant tries to proceed with less than two
Promoters and Partners, an error message is being displayed on the portal and he is not able to submit
the application for registration.
2.1 It is mentioned that, concept of ‘One Person Company’ has been inserted in the Companies
Act, 2013 with effect from 01.04.2014 and as per provision of section 2(62) of the Companies Act,
2013, it has been defined as a company which has only one person as member.
2.2 However, after the implementation of the change on the portal referred in Para 1.2 above, it has
been found that, since option of ‘One Person Company’ has not been provided in the dropdown,
therefore, such applicants have been trying to register as ‘Private Limited Company’. Thus, they are
facing problem to go further in registration process by selecting this option as it is one person company
and not required to fill details of two promoter/partners.
2.3 At present, the option of choosing ‘One Person Company’ is not available among different
categories of ‘Constitution of Business’ in notified FORM REG-01 of the Central Goods and Services
Tax Rules, 2017 (hereinafter referred to as ‘CGST Rules’) and hence not available on GST portal as
well. As of now, to handle this issue presently, an advisory has been issued by GSTN in this regard for
One Person Company applicants wherein it has been advised to select ‘Others’ in ‘Constitution of
Business’ and then specify ‘One Person Company’ in text field to complete the registration process.
2.4 It is proposed to make available on portal in the “Constitution of Business” tab, option of “One
Person Company”, so that one can apply as “One Person Company”. With this option, the system will
allow the applicant to fill only the details of the single member or owner and to submit the application
successfully on system.
3. The Law Committee in its meeting held on 31.08.2023 and 01.09.2023 deliberated on the matter
and recommended to incorporate ‘One Person Company’ as a Constitution of Business in Part-B of
FORM GST REG 01.

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B. Application for Enrolment as Goods and Services Tax Practitioner-Amendment in
Form GST PCT-01.
4.1 Rule 83(1) of the CGST Rules stipulates the following conditions for enrolment as Goods and
Services Tax practitioner by any person:
(a) that he is a retired officer of the Commercial Tax Department of any State Government or
of the Central Board of Indirect Taxes and Customs, Department of Revenue, Government of
India, who, during his service under the Government, had worked in a post not lower than the
rank of a Group-B gazetted officer for a period of not less than two years; or
(b) that he has enrolled as a sales tax practitioner or tax return preparer under the existing law
for a period of not less than five years;
(c) he has passed,
(i) a graduate or postgraduate degree or its equivalent examination having a degree in
Commerce, Law, Banking including Higher Auditing, or Business Administration or
Business Management from any Indian University established by any law for the time
being in force; or
(ii) a degree examination of any Foreign University recognised by any Indian
University as equivalent to the degree examination mentioned in sub-clause (i); or
(iii) any other examination notified by the Government, on the recommendation of the
Council, for this purpose; or
(iv) has passed any of the following examinations, namely:-
(a) final examination of the Institute of Chartered Accountants of India; or
(b) final examination of the Institute of Cost Accountants of India; or
(c) final examination of the Institute of Company Secretaries of India.
4.2 Presently, the following options are available on the portal for selection:-

4.3 Necessary changes are required to be made on the portal as well as in Part-B of Form GST
PCT-01 in line with the rules as below:
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a. COP is not required for CA/ICWA/CS as per the rules.
b. Option related to Graduate or Post Graduate in Law and Higher Auditing is not available
in notified form and the portal and needs to be inserted.
c. Option related to any other examination notified by Government is also not available in
notified form and the portal and needs to be inserted.
d. Deleting the option of “Advocate” as it is not aligned with the existing rules.
5. Accordingly, the Law Committee in its meeting held on 31.08.2023 and 01.09.2023
recommended to amend the S. No. 4 of Part-B of Form GST PCT-01 as below:
Agenda for 52nd GSTCM Volume 1
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4 Enrolment
sought as:
[Note: Sr. No. (4) to
(8) against row no 4
of the above table
should be from any
Indian University
established by any
law for the time
being in force.]
(1) Chartered Accountant holding COP
(2) Company Secretary holding COP
(3) Cost and Management Accountant holding COP
(4) Advocate Graduate or Postgraduate or its equivalent degree in
Law
(5) Graduate or Postgraduate or its equivalent degree in Commerce
(6) Graduate or Postgraduate or its equivalent degree in Banking
including Higher Auditing
(7) Graduate or Postgraduate or its equivalent degree in Business
Administration
(8) Graduate or Postgraduate or its equivalent degree in Business
Management
(9) Degree examination of any recognized Foreign University
recognized by any Indian University
(10) Retired Government Officials
(11) Sales Tax practitioner under existing law for a period of not less
than five years
(12) Tax return preparer under existing law for a period of not less
than five years
(13) Any other examination notified by Government


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C. Application for cancellation of TCS and TDS registration- Enhancement in Form GST
REG-08 format for having options for cancellation of registration against the request made by
the TDS and TCS registered persons.
6.1 As per the notification no. 26/2022-CT dated 26.12.2022, rule 12(3) of the CGST Rules has
been amended as follows:
(3) Where, on a request made in writing by a person to whom a registration has been granted
under sub-rule (2) or upon an enquiry or pursuant to any other proceeding under the Act, the
proper officer is satisfied that a person to whom a certificate of registration in FORM GST
REG-06 has been issued is no longer liable to deduct tax at source under section 51 or collect
tax at source under section 52, the said officer may cancel the registration issued under sub-
rule (2) and such cancellation shall be communicated to the said person electronically
in FORM GST REG-08:
Provided that the proper officer shall follow the procedure as provided in rule 22 for the
cancellation of registration.
6.2 Presently, the tax officers are issuing Order of cancellation of Registration as Tax Deductor at
Source or Tax Collector at Source in FORM GST REG-08 for suo-moto cancellation of registration
alone and there is no separate format for issuing order of cancellation of registration for those persons
against self-cancellation application.
7. As per the above said amendment, upon receipt of request made by TDS/TCS taxpayers through
e-mail or a letter (manual submission), the tax officers would accept the request and pass the
cancellation of registration order in FORM GST REG-08. In cases, where, the tax officer is not
satisfied with the request made by such taxpayers, he can convey the queries through email wherein he
can attach the document for seeking clarifications. In accordance with response submitted through email
by taxpayer, tax officer can take final decision for granting cancellation in REG-08 form and rejection
can be informed through email. However, there is a need to amend FORM GST REG-08 to
specifically provide for cancellation of registration of TCS/ TDS taxpayers on their request.
8. Further, a need is felt to rephrase and re-align the reasons for cancellation in FORM GST
REG-08 on the lines of those notified in respect of FORM GST REG-19 vide CGST (5th Amendment)
Rules, 2022 for better clarity.
9. Accordingly, the Law Committee in its meeting held on 31.08.2023 and 01.09.2023
recommended to substitute FORM GST REG-08 as follows:
Agenda for 52nd GSTCM Volume 1
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FORM GST REG-08
[See rule 12(3)]

Reference No
Date:
To
Name:
Address:
Application Reference No. (ARN) Date:

Order of Cancellation of Registration as Tax Deductor at source or Tax Collector at
source

This is in reference to the request raised vide letter/mail dated ……. for cancellation of
registration under the Act due to following reason:

i.
ii.
The undersigned is of opinion that the effective date of cancellation of registration is
<<DD/MM/YYYY>>.
2. You are required to furnish pending returns immediately.
3. Kindly refer to the supportive document(s) attached for case specific details.
4. It may be noted that the cancellation of registration shall not affect the liability to pay tax and
other dues under this Act or to discharge any obligation under this Act or the rules made
thereunder for any period prior to the date of cancellation whether or not such tax and other
dues are determined before or after the date of cancellation.
OR
Order of Cancellation of Registration as Tax Deductor at source or Tax Collector at
source

This has reference to the show-cause notice issued dated………..

Whereas no reply to the show cause notice has been submitted.
and whereas, the undersigned based on record available with this office is of the opinion
that your registration is liable to be cancelled for following reason(s) : or
Whereas reply to the show cause notice has been submitted vide dated______.
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and whereas, the undersigned on examination of your reply to show cause notice and based
on record available with this office is of the opinion that your registration is liable to be
cancelled for following reason(s) : or

Whereas no reply to the show cause notice has been submitted and on day fixed for personal
hearing, you did not appear in person or through authorised representative.
and whereas, the undersigned based on record available with this office is of the opinion
that your registration is liable to be cancelled for following reason(s) : or
Whereas no reply to the show cause notice has been submitted, but you or authorised
representative attended the personal hearing and made a written or verbal submission.
and whereas, the undersigned on examination of your written or verbal submission made
during personal hearing and based on record available with this office is of the opinion that
your registration is liable to be cancelled for following reason(s) : or

Whereas reply to the show cause notice has been submitted vide dated______. But, you or
authorised representative did not attend the personal hearing on scheduled or extended date.
and whereas, the undersigned on examination of your reply to show cause notice and based
on record available with this office is of the opinion that your registration is liable to be
cancelled for following reason(s) : or
Whereas reply to the show cause notice has been submitted vide dated______ and you or
authorised representative attended the personal hearing, made a written/oral submission
during personal hearing. And whereas, the undersigned has examined your reply to show
cause notice as well as submissions made at the time of personal hearing and is of the
opinion that your registration is liable to be cancelled for following reason(s) :
i.
ii.
The effective date of cancellation of registration is <<DD/MM/YYYY >>.

2. Kindly refer to the supportive document(s) attached for case specific details.
3. You are required to furnish pending returns immediately.
4. It may be noted that the cancellation of registration shall not affect the liability to pay tax and
other dues under this Act or to discharge any obligation under this Act or the rules made
thereunder for any period prior to the date of cancellation whether or not such tax and other
dues are determined before or after the date of cancellation.
Place:
Date:
Signature
Name of the Officer
Designation
Jurisdiction
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D. Amendment in rule 142 (3) of the CGST Rules with respect to FORM GST DRC-05.
10.1 After issuance of SCN and its summary in FORM GST DRC-01, if tax payer accepts the dues
communicated, then he intimates the proper officer of such payment in FORM GST DRC-03. Then the
proper officer communicates in FORM GST DRC-05 regarding conclusion of the proceedings in
respect of the said notice. FORM GST DRC-03 is voluntary payment and officer issues FORM GST
DRC-05 to communicate to the taxpayer that, as he has paid the dues voluntarily, proceedings initiated
vide SCN in FORM DRC-01 is hereby concluded.
10.2 In this regard, it is to be noted that prescribed FORM GST DRC-05 uses the word intimation.
However, rule 142 (3) of the CGST Rules states that “Where the person chargeable with tax makes
payment of tax and interest under sub-section (8) of section 73 or, as the case may be, tax, interest and
penalty under sub-section (8) of section 74 within thirty days of the service of a notice under sub-rule
(1), or where the person concerned makes payment of the amount referred to in sub-section (1) of
section 129 within seven days of the notice issued under sub-section (3) of Section 129 but before the
issuance of order under the said sub-section (3)], he shall intimate the proper officer of such payment
in FORM GST DRC-03 and the proper officer shall issue an order in FORM GST DRC-05
concluding the proceedings in respect of the said notice.” i.e. the word used in rule 142(3) is 'order'
and not 'intimation'.
10.3 It is also to be mentioned that section 107 of Central Goods and Service Tax Act, 2017
(hereinafter referred to as ‘CGST Act’) states that “Any person aggrieved by any decision or order
passed under this Act or the State Goods and Services Tax Act or the Union Territory Goods and
Services Tax Act by an adjudicating authority may appeal to such Appellate Authority as may be
prescribed within three months from the date on which the said decision or order is communicated to
such person.” Therefore, as per the wordings of rule 142 (3) of the CGST Rules, DRC-05 is an order
and any decision or order is appealable under section 107 of the CGST Act.
10.4 In order to remove this anomaly between rule 142(3) and FORM GST DRC-05, it is proposed
that rule 142 (3) may be amended so that words “intimation” shall be used instead of “order” with
respect to FORM GST DRC-05.
10.5 Accordingly, the Law Committee in its meeting held on 31.08.2023 and 01.09.2023 recommended
to amend rule 142(3) of the CGST Rules as follows:
“Rule 142- Notice and order for demand of amounts payable under the Act
(3) Where the person chargeable with tax makes payment of tax and interest under sub-section
(8) of section 73 or, as the case may be, tax, interest and penalty under sub-section (8) of section
74 within thirty days of the service of a notice under sub-rule (1), or where the person
concerned makes payment of the amount referred to in sub-section (1) of section 129 within
seven days of the notice issued under sub-section (3) of Section 129 but before the issuance of
order under the said sub-section (3)], he shall intimate the proper officer of such payment in
FORM GST DRC-03 and the proper officer shall issue an order intimation in FORM GST
DRC-05 concluding the proceedings in respect of the said notice.”.

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E. Changes in FORM GSTR-8 to include late fee
11.1 Section 47 of the CGST Act has been inter alia amended vide Finance Act, 2022 and the said
amendment has been notified w.e.f. 01.10.2022 vide Notification No. 18/2022-Central Tax dated
28.09.2022. The amended Section 47 of the CGST Act, accordingly, reads as under:
Section 47. Levy of late fee. -
(1) Any registered person who fails to furnish the details of outward supplies required under
section 37 or returns required under section 39 or section 45 or section 52 by the due date shall
pay a late fee of one hundred rupees for every day during which such failure continues subject
to a maximum amount of five thousand rupees.
11.2. The above amendment envisages that the late fee on delayed furnishing of return in FORM
GSTR-8 under section 52 of the CGST Act, 2017 by e-commerce operators, should also be levied from
the date of implementation of the aforesaid amendment. Since, existing FORM GSTR-8 does not
contain late fee table, GSTN proposed certain changes in FORM GSTR-8.
11.3. The Law Committee recommended the said changes in FORM GSTR-8 as below:
Agenda for 52nd GSTCM Volume 1
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FORM GSTR - 8
[See rule 67(1)]
Statement for tax collection at source
Year
Month

1. GSTIN
2. (a) Legal name of the registered person Auto Populated
(b) Trade name, if any Auto Populated

3. Details of supplies made through e-commerce operator
(Amount in Rs. for all Tables)

GSTIN
of the
supplier
Details of supplies made which attract TCS Amount of tax collected at source
Gross value
of supplies
made
Value of
supplies
returned
Net amount
liable for TCS
Integrated
Tax
Central Tax State /UT Tax
1 2 3 4 5 6 7
3A. Supplies made to registered persons

3B. Supplies made to unregistered persons


4. Amendments to details of supplies in respect of any earlier statement

Original details Revised details
Month GSTIN
of
supplier
GSTIN
of
supplier
Details of supplies made which
attract TCS
Amount of tax collected at
source
Gross value
of supplies
made
Value of
supply
returned
Net
amount
liable for
TCS
Integrated
Tax

Central
Tax
State/UT
Tax
1 2 3 4 5 6 7 8 9
Agenda for 52nd GSTCM Volume 1
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4A. Supplies made to registered persons

4B. Supplies made to unregistered persons




5. Details of interest

On account of Amount
in
default
Amount of interest
Integrated
Tax
Central
Tax
State /UT
Tax
1 2 3 4 5
Late payment of TCS
amount


6. Tax payable and paid
Description Tax payable Amount paid
1 2 3
(a)Integrated Tax
(b)Central Tax
(c)State / UT Tax

7. Interest payable and paid
Description Amount of
interest payable
Amount paid
1 2 3
(a)Integrated tax
(b)Central Tax
Agenda for 52nd GSTCM Volume 1
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(c)State/UT Tax

7. Interest, late fee payable and paid
Description Amount payable Amount paid
1 2 3
(I) Interest on account of TCS in respect of
(a) Integrated tax
(b) Central Tax
(c) State/UT Tax
(II) Late fee
(a) Central tax
(b) State / UT tax

8. Refund claimed from electronic cash ledger
Description Tax Interest Penalty Other Debit Entry
Nos.
1 2 3 4 5 6
(a)Integrated tax
(b)Central Tax
(c)State/UT Tax
Bank Account Details (Drop
Down)


9. Debit entries in cash ledger for TCS, /interest and late fee payment [to be populated
after payment of tax and filing of statement submissions of return]
Description Tax paid in cash Interest Late fee
1 2 3 4
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(a) Integrated tax
(b) Central
Tax

(c) State/UT Tax

Verification
I hereby solemnly affirm and declare that the information given herein above is
true and correct to the best of my knowledge and belief and nothing has been
concealed therefrom.
Signature of Authorised Signatory
Place: Name of Authorised Signatory
Date: Designation /Status
Instructions:-
1. Terms Used:-
(a) GSTIN:- Goods and Services Tax Identification Number
(b) TCS:- Tax Collected at source
2. An e-commerce operator can file GSTR- 8 only when full TCS liability has been
discharged.
3. TCS liability will be calculated on the basis of table 3 and table 4.
4. Refund from electronic cash ledger can only be claimed only when all the TCS
liability for that tax period has been discharged.
5. Cash ledger will be debited for the refund claimed from the said ledger.
6. Amount of tax collected at source will flow to Part C of GSTR- 2A of the taxpayer
on filing of GSTR-8.
7. Matching of Details with supplier’s GSTR-1 will be at the level of GSTIN of
supplier.
12. Accordingly, The agenda is placed before the Council for approval.




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Agenda Item 3(ix): Subject: Clarification on the scope of the refund on account of inverted duty
structure in respect of supplies of certain construction services.
References have been received from field formations requesting for clarification regarding
applicability of Notification number 15/2017-Central Tax (Rate), dated 28.06.2017 in respect of
applications for refund on account of inverted duty structure in the case of supply of certain services
like construction of bridges and roads etc. It has been mentioned that some of the field formations are
taking a view that roads, bridges are “civil structures” and the construction of such civil structures would
amount to a service which has been specified in Item 5(b) of Schedule II of the CGST Act, 2017. It has
also been mentioned that refund of accumulated credit on account of inverted duty structure in the case
of supply of services specified in Item 5(b) of Schedule II of the CGST Act, 2017 is restricted by virtue
of Notification number 15/2017-Central Tax (Rate), dated 28.06.2017 and accordingly, refund of
accumulated credit on account of inverted duty structure shall not be available in respect of construction
of civil structures like bridges, roads, etc. Per contra, it has also been mentioned that some other field
formations are taking a view that the activity of construction of roads, bridges is not covered under Item
5(b) of Schedule II of the CGST Act,2017 but instead falls under the works contract service under Item
6(a)of the Schedule II of the CGST Act, 2017 and accordingly, there is no restriction on refund of
accumulated credit on account of inverted duty structure in the case of supply of such services under
Notification number 15/2017-Central Tax (Rate), dated 28.06.2017.

2. The matter has been examined. Sub-section (3) of section 54 of the CGST Act, 2017, which
provides for the refund of any unutilized input tax credit on account of zero rated supply as well as
inverted duty structure, is reproduced as under:
“(3) Subject to the provisions of sub-section (10), a registered person may claim refund of any
unutilised input tax credit at the end of any tax period:
Provided that no refund of unutilised input tax credit shall be allowed in cases other than-
(i) zero rated supplies made without payment of tax;
(ii) where the credit has accumulated on account of rate of tax on inputs being higher than the
rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of
goods or services or both as may be notified by the Government on the recommendations of
the Council:
Provided further that no refund of unutilised input tax credit shall be allowed in cases where
the goods exported out of India are subjected to export duty:
Provided also that no refund of input tax credit shall be allowed, if the supplier of goods or
services or both avails of drawback in respect of central tax or claims refund of the integrated
tax paid on such supplies.”
2.1 On perusal of the above, it can be stated that the Government can restrict refund of accumulated
input tax credit in case of certain supplies of goods and by way of issuance of a Notification on the
recommendations of the GST Council. .
2.2 Under these powers, Government, on the recommendations of GST Council, issued
Notification no. 15/2017-Central Tax (Rate), dated 28.06.2017, whereby refund of unutilized input tax
credit was restricted in respect of supplies specified in Item 5(b) of Schedule II of the Act, which inter
alia reads as under:
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“In exercise of the powers conferred by sub-section (3) of section 54 of the
Central Goods and Services Tax Act, 2017 (12 of 2017),the Central
Government, on the recommendations of the Council hereby notifies that no refund
of unutilised input tax credit shall be allowed under sub-section (3) of section 54
of the said Central Goods and Services Tax Act, in case of supply of services specified
in sub-item (b) of item 5 of Schedule II of the Central Goods and Services Tax Act.”
2.3 Item 5(b) of Schedule II is reproduced below:
5. Supply of services: The following shall be treated as supply of services, namely:-
(a) renting of immovable property;
(b) construction of a complex, building, civil structure or a part thereof, including a complex
or building intended for sale to a buyer, wholly or partly, except where the entire consideration
has been received after issuance of completion certificate, where required, by the competent
authority or after its first occupation, whichever is earlier.
2.4 In this regard, reference is also drawn to Item 6(a) of Schedule II of CGST Act as well as clause
(119) of Section 2 of CGST Act which are reproduced below:
Schedule II: ACTIVITIES OR TRANSACTIONS TO BE TREATED AS SUPPLY
OF GOODS OR SUPPLY OF SERVICES
6. Composite supply: The following composite supplies shall be treated as a supply of services,
namely:-
(a) works contract as defined in clause (119) of section 2;
…
Further, Clause (119) of Section 2 of CGST Act:
‘(119) “works contract” means a contract for building, construction, fabrication,
completion, erection, installation, fitting out, improvement, modification, repair,
maintenance, renovation, alteration or commissioning of any immovable property wherein
transfer of property in goods (whether as goods or in some other form) is involved in the
execution of such contract;’
2.5 On perusal of the abovesaid provisions, it can be inferred that refund of unutilised input tax
credit shall not be available in case of supply of services covered under Item 5(b) of Schedule II of
CGST Act. Therefore, to decide as to whether refund on account of inverted duty structure in the case
of supply of certain construction services like construction of bridges and roads etc is admissible or not,
it needs to be determined whether the supply of services of construction of bridges or roads can be
considered as construction of civil structures specified in Item 5(b) of Schedule II of the CGST Act,
2017 or on the contrary, such services are a works contract services falling under the Item 6(a) of
Schedule II of the CGST Act, 2017 and not covered under Item 5(b) of Schedule II of the CGST Act,
2017 .
Agenda for 52nd GSTCM Volume 1
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3. In this regard, it is observed that Entry 5(b) and Entry 6(a) of Schedule II both relate to
construction services, yet the notification denying refund has been limited to activities specified in entry
5(b) and does not extend to Entry 6(a). From this, it prima facie appears that the Entry 5(b) of Schedule
II of the Act is a sub-set of Entry 6(a) of the said Schedule. This is significant in view of the fact that
“real estate” services have been kept out of GST except to the extent of construction services involved
and this appears to be the reason for creating two different entries in the same Schedule for an activity
which has a predominantly uniform nature viz. construction services. Also, Entry 5(b) appears to cover
only those work contract services for construction of building, complexes, structures, etc. where the
said building, complexes, civil structures, are intended for sale to a buyer.
3.1 In this context, it is relevant to appreciate that the debate surrounding refund of accumulated
input tax credit in this matter hinges upon whether the service under consideration is covered by Entry
5(b) or Entry 6(a) of Schedule II of the CGST Act, 2017. Entry 5 of Schedule III of the Act which has
been considered as neither a supply of goods nor a supply of services for the purposes of the Act reads
as under:
“5. Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of
building.”
3.2 Sale of building and sale of land (other than services in connection with land, as specified in
Entry 5(b) of Schedule II) have been deemed to be “no-supplies” for the purpose of GST and are,
accordingly, not leviable to tax under the CGST Act, 2017. The Entry 5(b) of Schedule II appears to be
an entry relating to real-estate as manifested in immovable property like a completed building or
apartment which involves an element of land or undivided share in land, and is also intended for sale to
a buyer. This interpretation appears to be coherent with the purpose for which refund of unutilised
input tax credit is restricted only to Entry 5(b) because if the intention had been to bar refund of
unutilised input tax credit in respect of all the construction services involving works contract, then
it would have been explicitly stated that no such refund of unutilised input tax credit would be
available in respect of construction services involving works contract and the relevant portion of the
Notification no. 15/2017-Central Tax (Rate) dated 28th June, 2017 would have read:
“…..no refund of unutilised input tax credit shall be allowed under sub-section
(3) of section 54 of the said Central Goods and Services Tax Act, in case of supply of
construction services involving works contract. specified in sub-item (b) of item 5 of
Schedule II.”
3.3 It therefore appears that a “civil structure” like construction of a bridge, road, which are
not intended for sale to a buyer, may appropriately be classifiable in Entry 6(a) of Schedule II
of the CGST Act, 2017 i.e. under works contract services, on which refund of unutilised input tax
credit is not restricted.
4. Attention is also invited to the discussions held in GST Council in its 15th meeting held on
03.06.2017 & 20th meeting held on 05.08.2017, as per which it appears that the restriction imposed on
refund in respect of Entry 5 (b) in Schedule II is regarding services which are related to “real estate”
services, which are intended for sale to buyers and also involve sale of land as part of consideration.
The relevant extracts of Agenda Note approved by GST Council is as follows:
4.1 Relevant excerpt of Final Agenda Note of 15th GST Council meeting is as follows:
Agenda for 52nd GSTCM Volume 1
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24.2. The Secretary stated that in the construction sector, works contracts have been deemed
as service and GST would be applicable for supply of work contract services before completion
of construction of a building but there would be no GST on the sale of a ready built building or
flat. He stated that as per the decision of the Supreme Court, no tax could be charged on the
value of land, and therefore, the Fitment Committee recommended that in a supply of works
contract service where the value of land was included in the amount charged from the service
recipient (along with the value of building materials and the services given by the contractor),
one-third of the total consideration amount could be taken as the value of land for abatement
purpose. He stated that full ITC on works contract would encourage purchase of building
materials from registered suppliers but no refund of input tax credit overflow would be
permitted. He stated that presently the approximate combined incidence of tax was around 9%
-10% but the headline rate of tax would now become 12% with the benefit of ITC. He added
that the overflow of input tax credit in this sector would not be refunded. He stated that
building materials would be mostly in the rate slab of 12% and due to benefit of ITC, the prices
of flats should become cheaper.
4.1.1 From the above, it is deduced that the intention of GST Council was to place restriction on
refund of unutilised input tax credit in case of supply of such works contract services where the value
of land was included in the amount charged from service recipient.
4.2 The issue was further discussed in 20th GST Council meeting held on 5th August, 2017 wherein
it was mentioned in Agenda Item 7 (iv) that
4. Works contract, not exempt in the service tax era, was subjected to service tax on
abated value. Therefore, the effective service tax on works contract was 6% without ITC of
input goods. Thus, the cumulative incidence of service tax, Central Excise & VAT on input
goods, and VAT @composition scheme was about 24-25% (without factoring in CST and entry
tax). Therefore, works contract provided to government, even though exempt from service tax
(only the service portion) suffered taxes of about 19-20%.
5. In view of the above and the fact that the goods part of works contract was taxable by
the States in the pre-GST era and that it would be difficult to segregate the service part from
the composite contract of works contract service (& prone to mis-use), it was recommended by
the Fitment Committee not to carry forward these exemptions in the GST era. Also, exempting
the service part of works contract service does not also make sense when full ITC of input
goods, capital goods and input services is available. Exempting the service part would require
reversals of ITC with all its attendant disputes. Then, there is a view that full ITC of capital
goods should not be allowed when only part of the output is taxed. So, this would again entail
complications. Finally, the gains from GST lie in completion of ITC chain which incentivizes
dealers to procure duty-paid raw materials and dis-incentivises procurement of duty
evaded/avoided raw materials. This is precisely the self-policing mechanism of GST. It is for
these reasons that the GST Council accepted the recommendations of the Fitment Committee
to not carry forward such exemptions under GST. As a result, Works Contract service attracts
GST @ 18% with full ITC and no restriction on refund of accumulated credit. Ultimately, it
is the completion of the ITC chain in respect of works contract (particularly government
contracts) which will effectively achieve what demonetization sought to achieve.
Agenda for 52nd GSTCM Volume 1
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4.2.1 In this context, it is also relevant to mention that earlier in the Service Tax regime, the
exemption provided to service component of works contract service was in the nature of Services
provided by way of construction, erection, commissioning, installation, completion, fitting out, repair,
maintenance, renovation, or alteration of a road, bridge, tunnel, or terminal for road transportation for
use by general public.
4.2.2 From the discussions above, it thus becomes clear that the exemption on works contract was
not carried forward in GST regime so as to ensure completion of ITC chain, which as a consequence,
also requires that there will be no restriction on refund of accumulated credit in case of works contract
services provided to the Government. And moreover, in the exemption list earlier, the construction of
road, bridge etc. was specifically mentioned, thus there is reasonable basis to conclude that the
construction of road, bridge shall fall under Entry 6(a) instead of Entry 5 (b) of Schedule II of CGST
Act.
4.3 Further, in Agenda item 7(i) of 22nd GST Council Meeting held on 06.10.2017, it was
mentioned that “In the initial meetings of Fitment Committee, it was decided to withdraw this service
tax exemption because it was felt that it was not possible to segregate the value of services from goods
and also because States levied VAT on the goods portion. Works contract was subject to both service
tax and VAT in the pre-GST regime as permitted by Article 366 (29A) (b) of the Constitution. However,
under the GST regime, works contract has been treated as a supply of service under Schedule II of the
GST Act (Para 6(a)).” In the agenda, it has also been specifically mentioned that works contract
provided to Government which were earlier exempted now fall under Para 6 (a) of Schedule II of the
CGST Act.
4.3.1 Paras 5 & 7 of the Agenda item ibid also mentions that
5. As far as other categories of works contract are concerned, for instance, irrigation and
CAD (dams and barrages), Drinking Water Supply Scheme/ Mission etc. the effective GST rate
appears to be less than the pre GST rate. In fact, in the following category of works, 12% GST
rate may lead to a situation to give refunds: -
a) Roads and Buildings
b) Road Renewals
c) Bridge Works
7. Analysis of the data submitted by the Government of Telangana reveals that even in
canal works, incidence of tax in the GST regime is less than what it was in the pre GST regime
and in the case of roads and buildings, bridge works even the 12% GST rate would merit
refund. (Calculation sheet is circulated separately).
5. From the agenda items discussed in various GST Council meetings mentioned above, it appears
that refund of unutilised input tax credit is not restricted in case of supplies of works contract services
relating to construction of roads and bridges etc. falling under Item 6(a) of Schedule II of CGST Act,
2017, which are not intended for sale to buyers and where value of supply of services does not include
value of the land.
Agenda for 52nd GSTCM Volume 1
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6.1 Law Committee (LC) deliberated on the issue in its meeting held on 31.08.2023 and 01.09.2023
and all the members of LC, other than the member from State of Karnataka, were of the view that
construction of only such civil structures including a complex or building, which are intended for sale
to a buyer along with land or undivided share of land are covered under entry 5 (b) in Schedule II of
CGST Act and are, therefore, covered under the restriction on refund of accumulated ITC on account
of inverted duty structure as per Notification No. 15/2017-Central Tax (Rate), dated 28.06.2017,
whereas the construction of civil structures, like bridges, roads, etc. which are not intended for sale to
a buyer, are not covered under the restriction for grant of refund of inverted duty structure under Section
54(3) as per Notification No. 15/2017-Central Tax (Rate), dated 28.06.2017.
6.2 The LC member from Karnataka, however, opined that construction of all kinds of civil
structures, including bridges, falls under Entry 5(b) of Schedule II of CGST Act, 2017 and hence no
refund of inverted duty structure under Section 54(3) should be granted in such cases as per Notification
No. 15/2017-Central Tax (Rate), dated 28.06.2017.
7. The Agenda is placed before the GST Council for deliberation.







Agenda for 52nd GSTCM Volume 1
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Agenda Item 4: Recommendations of the Fitment Committee for the consideration of the GST
Council
This agenda note deals with proposals regarding GST rates on supply of goods and services.
The proposed changes in GST rates emanate from the recommendations made by the Fitment
Committee.
2. Briefly stated, representations/recommendations have been received from various stake holders
including Ministries and other offices of Centre and States, seeking changes in GST rates and certain
clarifications regarding GST rates applicable on supply of certain goods/services.
3. The Fitment Committee met on 25.08.2023, 05.09.2023 12.09.2023 & 26.09.2023 and had
detailed discussions on recommendations received from various stakes holders seeking changes in
GST/IGST rates or seeking clarification on supply of goods/services. After examination, the Fitment
Committee has recommended changes in GST rates or issue of clarification, in relation to certain goods
and services. Further, the Fitment Committee has recommended no change in respect of certain issues.
On some issues, Fitment Committee was of the view that further examination would be required before
making any recommendation to the GST Council.
4. Accordingly, Fitment Agenda for consideration of the GST Council is summarised as below:
a) Recommendations made by the Fitment Committee for making changes in GST rates or for
issuing clarification in relation to goods – Annexure-I
b) Issues where no change has been proposed by the Fitment Committee in relation to goods –
Annexure-II
c) Issues deferred by the Fitment Committee for further examination in relation to goods –
Annexure-III
d) Recommendations made by the Fitment Committee for making changes in GST rates or for
issuing clarifications in relation to services – Annexure-IV
e) Issues where no change has been proposed by the Fitment Committee in relation to services
– Annexure-V
f) Issues deferred by the Fitment Committee for further examination in relation to services –
Annexure-VI

5. The proposals, as contained in para 4 above are placed before the GST Council for
consideration.





Agenda for 52nd GSTCM Volume 1
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a) Recommendations made by the Fitment Committee for making changes in GST rates or for
issuing clarifications in relation to goods

Annexure – I

S.
No.
Description
of Goods
/HSN
Present
GST
Rate
Requeste
d GST
Rate
Comments
1 Food
preparation
of millet
flour in
powder
form,
containing at
least 70%
millets

18% Exemptio
n
• In the 49th & 50th GST Council Meetings, Council
deferred the proposal for further examination
• The product under consideration is food preparation of
flour of millets
• When millets undergo multiple stages of preparation
including washing, roasting, grinding, addition of
additives and other substances such as pulses, further
processing and packaging for use as food preparations,
the final products are food preparations of flour.
• This heading covers a number of food preparations
with a basis of flour, which derive their essential
character from such materials whether or not these
ingredients predominate by weight or volume.
• Since 2023 is being celebrated as Year of the Millets in
2023, to promote millet-based products, Fitment
Committee recommended the following rates:

0%- food preparation of millet flour, in powder form,
containing at least 70% millets by weight (CTH 1901),
sold in other than pre-packaged and labelled form

12%- if sold in pre-packaged and labelled form.
• Further, considering that there was no ambiguity or
confusion in trade regarding prepared flour preparations
in the past, Fitment Committee recommended that there
is no merit in regularising the issue for past period.
2 Gold and
Silver
imported by
Karur Vysya
Bank
(Chapter 71)
IGST
3%
(On
Import)
Nil
(On
Import)
• IGST exemption is available on imports of gold, silver or
platinum by specified banks and other entities mentioned
in list 34A, 34B & 34C of Sr. No. 359A of Notification
No. 50/2017 – Customs dated 30.06.2017.
• GST Council, in its 50th meeting dated 11.07.2023,
recommended to update the said list in accordance with the
Appendix 4B of HBP, FTP, 2023, after confirmation by
DGFT and DGEP. Accordingly, after confirmation from
Agenda for 52nd GSTCM Volume 1
Page 311 of 389
DGFT and DGEP, notification No. 46/2023-Customs
dated 26.07.2023 was issued (refer S.No. 3 in table), to
update the list of banks and other entities as per revised
Appendix 4B of HBP of FTP, 2023.
• Thereafter, representation has been received from Karur
Vysya Bank, requesting to add its name in the said list in
accordance with the DGFT new public notice 28/2023
dated 18.08.2023. Earlier name of this bank was not there
in the list.

• DGFT vide Public Notice No. 28/2023 dated 18.08.2023
published in office gazette has amended the said Appendix
4B of Handbook of Procedure (FTP 2023), updating:
(i) the list of banks authorised by RBI to import both
Gold & Silver for FY 2023-24, as mentioned at
Part A of the Appendix.
(corresponds to List 34 A of notfn. 50/2017-
Cus);
(ii) the list of banks authorised by RBI to import only
Gold for FY 2023-24, as mentioned at Part B of
the Appendix
(corresponds to List 34B of notfn. 50/2017-Cus);

(Copy of Public Notice is attached herewith for
ready reference Appendix I)

• Fitment committee recommended to:
(i) update List 34A & 34B of Sr. No. 359A of
Notification No. 50/2017 – Customs dated
30.06.2017 as per revised appendix 4B of HBP
(FTP 2023) as amended and published by DGFT
vide public notice 28/2023 dated 18.08.2023.
(ii) obtain general approval from GST Council to
update the lists as and when Appendix 4B is
amended by DGFT and thereafter placing before
Council for information as the changes are
technical in nature.
3 Motor
Vehicles
(8703)
purchased
28% 18%
Presently
only the
orthopedic
ally
• Hon’ble Madras High Court in the matter of writ petition
filed by Ms. Carunia Seelavathi (who is a visually
impaired person) passed a judgement dated 26.06.23 that
the petitioner is eligible for GST concession for purchase
of vehicle, as is presently available to orthopedically
disabled persons.
Agenda for 52nd GSTCM Volume 1
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by
Divyangjan.
disabled
are
eligible
for
concessio
nal GST
rate of
18% on
purchase
of motor
vehicles.
The
Hon’ble
High
Court of
Madras
has
directed
vide
judgement
dated
26.06.23
that the
said
concessio
n be given
to the
petitioner
who is
visually
impaired,
within
four
weeks
from date
of receipt
of letter
from the
petitioner.

• Presently, GST concession (18%) for purchase of
vehicles (HSN 8703) is available only to orthopedic
physical disabled persons vide Sl. No. 400 of Schedule
III of Notification No. 01/2017-Integrated Tax (Rate).
Entry is as under:

Following motor vehicles of length not exceeding 4000 mm,
namely: -
(a) Petrol, Liquefied petroleum gases (LPG) or compressed
natural gas (CNG) driven vehicles of engine capacity not
exceeding 1200cc; and
(b) Diesel driven vehicles of engine capacity not exceeding
1500 cc
for persons with orthopedic physical disability, subject to the
condition that an officer not below the rank of Deputy
Secretary to the Government of India in the Department of
Heavy Industries certifies that the said goods shall be used
by the persons with orthopedic physical disability in
accordance with the guidelines issued by the said
Department.

• The GST Council in its 47th Meeting had discussed this
issue. During discussion, it was opined that while there
is merit in the proposal, GST rate tweaking may not be
an appropriate method of relief as GST rate structure
revision based on end use creates distortion. The
concession rate for orthopedically disabled person has
been continued from pre-GST regime. The
benefit/concession to Divyangjan on purchase of vehicle
should be in the form of reimbursement of GST already
paid, which should be done through direct transfer
through the budgetary route by the Department of
Empowerment of Persons with Disabilities (DEPwD).
Once a decision is taken to implement the scheme by
DEPwD, through direct transfers, it is for the DEPwD to
decide as to which category of disability need to be
covered under the scheme. As of now, no such scheme
has been formulated by DEPwD.
The Hon’ble Madras High Court directed that the Authority
concerned shall ensure that necessary orders exempting the
petitioner from the Motor Vehicle’s tax as well as GST
within a period of four weeks from the date of receipt of letter
Agenda for 52nd GSTCM Volume 1
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from the petitioner Hon’ble Madras High Court judgment has
vide order dated 23rd June, 2023 ordered to grant concessional
GST rate to the petitioner, who is a visually handicapped. The
relevant portion of the order is abstracted as below:

“ Considering the recommendation of the Commission which
is a commission specifically established for the disabled and
taking into consideration the fact that today the visually
challenged persons are having more opportunities of
employment in the government sector and their commuting to
the place of work becomes challenging , this court is of the
opinion that the exemption has to be granted to the petitioner
and accordingly, the writ petitions are allowed. The authority
concerned shall ensure that necessary orders exempting the
petitioner from the Motor Vehicle’s Tax as well as GST are
passed within a period of four weeks from the date of receipt
of a undertaking letter by the petitioner.”
• (Copy of judgement is attached as Appendix -II for
ready reference).
• An appeal has been filed before Madurai bench, along
with stay application on 07.09.2023 against the said
judgement of Hon’ble High Court on the main grounds
that the decision whether or not to provide exemption is
to be determined by the GST Council and is a policy
decision
• Fitment committee recommended to place the order of
Hon’ble High Court before the Council for information
and suitable recommendation.

4. Clarification
on imitation
Zari thread
or yarn
made out of
polyester
film
(metallised
/lacquered)
/plastic film

5% NA • The GST Council in its 50th meeting had recommended
reduction of GST rate to 5% on all imitation zari thread
or yarn known by any name in trade parlance and
consequently Sl No, 218AA was created in notification
no. 1/2017- Central Tax (Rate) dated 28.6.2017.
• The request for clarification has been received in respect
of metal coated plastic film converted to metallised yarn
(imitation zari) and twisted with nylon, cotton, polyester
or any other yarn to make imitation zari thread. Doubts
have been raised whether this item is covered under
imitation zari thread or yarn notified at 5% or under the
other metallised yarn category at 12%.
• As per HS Explanatory Notes, the heading 5605 covers
–
1) yarn of any textile material (including
Agenda for 52nd GSTCM Volume 1
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monofilament , strip and the like, and paper
yarn) combined with metal thread or strip,
whether obtained by a process of twisting,
cabling or by gimping, whatever the proportion
of the metal present
2) yarn of any textile material covered with metal
by any other process including yarn covered
with metal by electro-deposition.

The heading also covers products consisting of a core of
metal foil (generally of aluminium) or of a core of plastic
film coated with metal dust, sandwiched by means of an
adhesive between two layers of plastic film.

• Fitment Committee recommended that a clarification
may be issued in light of explanatory notes. Fitment
Committee also recommended to clarify that no refund
will be permitted on polyester film (metallised
/lacquered) /plastic film on account of inversion

Agenda for 52nd GSTCM Volume 1
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b) Issues where no change has been proposed by the Fitment Committee in relation to goods
Annexure – II
S.
No.
Description
of Goods
/HSN
Present GST
Rate
Requested GST
Rate
Comments
1 Concrete
mixers, Self-
loading
concrete
mixers
(SLCM) and
boom pumps
As applicable To issue
clarification that:
(a) Concrete
mixer, SLCM
and boom
pump supplied
independently,
or mounted on
a chassis
which is
supplied by
the customer,
would not
constitute a
body for the
motor vehicle
and therefore
not to be
classified
under HSN
8707 (28%).

(b) The concrete
mixer/ SLCM
would be
classifiable
under Tariff
Heading 8474
@ 18% (SI.
No. 363 of III
Schedule of
Notification
No.1 /2017-
ITR
(c) The boom
pump would
be classifiable
under Tariff
• Issue is relating to classification of concrete
mixers, concrete pumps, concrete mixer lorries
and body of vehicle.
• Concrete mixers are classified under HS
Code 8474 and accordingly attract 18% GST
rate vide Sl No. 363 of schedule III of
notification no. 1/2017-Central Tax (Rate),
dated 28.06.2017.

• Boom pumps i.e., concrete pumps are
classified under HS Code 8413 and
accordingly attract 18% GST rate vide Sl No.
317A of schedule III of notification no.
1/2017-Central Tax (Rate), dated 28.06.2017.
GST rate on concrete pumps was reduced from
28% to 18% vide amending Notification No.
41/2017 dt. 14-November-2017 by omitting
their entry from Sl. No. 117 of schedule IV of
notification no. 1/2017-Central Tax (Rate),
dated 28.06.2017.

• Concrete mixer lorries are classified under HS
Code 8705 (SPV) and accordingly attract 18%
GST rate vide Sl No. 401A of schedule III of
notification no. 1/2017-Central Tax (Rate),
dated 28.06.2017. GST rate on Concrete mixer
lorries was reduced from 28% to 18% vide
amending notification No. 18/2018 dt 26-July-
2018 by omitting their entry from Sl No. 167
of schedule IV of notification no. 1/2017-
Central Tax (Rate), dated 28.06.2017 wef
27.07.2018.

• As mentioned above, concrete mixers and
concrete pumps have been specifically
classified under Chapter 84 (attracting 18%).
Concrete mixture lorries classified under 8705
Agenda for 52nd GSTCM Volume 1
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Heading 8413
and would
attract GST @
18% in terms
of SI. No.
317A of III
Schedule
Notification
No.1 /2017-
ITR
attracted 28% before 27.07.2018 and 18%
thereafter. Body parts of motor vehicle (8707)
attract 28%.

• Further, explanatory notes for HS code 8474
clearly mentions that concrete mixers
permanently mounted on a railway wagon or
a lorry chassis are , however, excluded from
8474 and will be covered under heading
86.04 or 87.05 respectively

• Entries are clear, specific clarification may not
be required.

• Fitment Committee recommended to
maintain status quo.

2 Spare Parts of
Renewable
Energy
Devices
irrespective of
the end use
12% To issue a
clarificatory
amendment to
Notification No.
1/2017-Central
Tax (Rate), dated
the 28.06.2017
that the rate of
GST on the spare
parts of renewable
energy devices is
12%, irrespective
of the end-use
(used in
manufacture of the
renewable energy
devices or used for
replacement,
repair or for
maintenance of the
renewable energy
devices).

• Presently, concessional rate of 12 % (wef
01.10.2021) has been provided to following
renewable energy devices and parts for
their manufacture:
(a) Bio-gas plant;
(b) Solar power based devices;
(c) Solar power generator;
(d) Wind mills, Wind Operated Electricity
Generator (WOEG);
(e) Waste to energy plants / devices;
(f) Solar lantern / solar lamp;
(g) Ocean waves/tidal waves energy
devices/plants;
(h) Photo voltaic cells, whether or not
assembled in modules or made up into
panels…

[S. No. 201A of Schedule II of notification
No. 01/2017-CT(Rate) dated 28.06.2017]
• Prior to 01.10.21, these goods attracted a
concessional GST rate of 5% under S. No.
234 of Schedule I of notification No.
01/2017-CT (Rate). On the
recommendations of 45th meeting, it was
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decided to increase the rate from 5% to 12 %
to correct inversion.

• Presently, the concessional rate of GST is
applicable only on the parts for manufacture
of enlisted devices

• However, if these parts are purchased for
replacing the parts on existing renewable
energy devices, the concessional GST rate
would not apply as the parts are not being
used in the manufacture these devices. In
such cases, the standard GST rate is
applicable based on their classification and
the rates notified.

• The proposal will lead to expansion of the
scope of concession.

Fitment Committee recommended to maintain
Status quo
3. Electric
Vehicle
Battery
[8507]
18% 5% • Lithium ion batteries attract a GST rate of
18% (S.N. 376 AA-Sch -III, Notification
1/2017-CTR), which is already lower than
the 28% GST rate ( (S.N. 139 , Sch -IV,
Notfn 1/2017-CTR) charged on other
electric accumulators/batteries falling
under HSN 8507.
• Electric vehicles generally use lithium ion
batteries.
• Lithium ion batteries have multiple uses
i.e. cellular mobile phones, portable
electronics, electric vehicles etc. We may
not consider request.

Fitment Committee recommended to
maintain Status quo
4. Sugar boiled
Confectionary
12% Clarification
regarding the
scope of 'Sugar
Boiled
Confectionery'.
• Sugar boiled confectionary attract GST at
the rate of 12% and Sugar confectionary
attract GST at the rate of 18%.
• Sugar boiled confectionary refers to boiled
sweets which has a dedicated 8-digit HS
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Code 1704 90 20.
• Fitment Committee was of the view that
Sugar boiled confectionary is
distinguishable from sugar confectionary.
• Fitment Committee recommended that no
clarification is required in view of the
existing BIS standards.
5. Aerated
beverages and
energy drinks

GST
Compensation
Cess @12%
Cess payable by
CSD on outward
supply of good
may be fully
exempted
OR
applicable cess
may be collected
at the Depot level
for supplies made
by URCs
• Aerated beverages and energy drinks, falling
under HS 2202 attract CC@12%.
• Vide notification No. 7/2017- Central Tax
(Rate), dated 28.06.2017, and corresponding
IGST/SGST notifications supply of goods,
under any Chapter, by the Unit Run Canteens
to the authorized customers is fully exempt
from GST based on recommendation of the
GST Council in the 15th Meeting.
• In the said meeting, after detailed deliberation,
a conscious policy decision was taken by the
Council that no concession is to be given from
levy of Compensation Cess.
• Hence Fitment Committee recommended no
change in the rate.
• As regards the suggested option of collecting
applicable cess at the Depot level for supplies
made by URCs, Fitment Committee
recommended that the matter may be referred
to the Law Committee for consideration.
6. Tobacco
products
Various rates Uniform
additional
compensation cess
on cigarettes/
compensation cess
on bidis/
additional
compensation cess
on smokeless
tobacco products/
or lower
compensation cess
on cigarettes sticks
up to 70 mm
• Tobacco products such as cigarettes, chewing
tobacco, gutkha, etc. attract GST,
Compensation Cess, Basic Excise Duty and
National Calamity Contingent Duty (NCCD),
while Bidis attract GST, Basic Excise Duty
and National Calamity Contingent Duty
(NCCD).
• In respect of tobacco and tobacco products,
while deciding the Compensation Cess rates, it
was decided that in line with the weighted
average VAT rate [28.7%], the GST rate on
cigarettes may be kept at 28%.
• Regarding bidis, in the 15th GSTC Meeting, the
Fitment Committee had proposed the GST rate
of 28% on bidi taking into account the fact that
the total tax incidence on Bidi was 25.68% and
the Fitment Committee had left open the issue
Agenda for 52nd GSTCM Volume 1
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of Compensation Cess on Bidi. The GST
Council, after detailed deliberation, decided to
charge 28% GST on bidis as proposed by the
Fitment Committee but decided not to levy any
Compensation cess on bidis. It has remained
unchanged since then.
• Bidi industry is, in fact, a household industry
in certain parts of India. Significant number of
workers are engaged in the manufacture of
biris and are rolled mostly by women at home.
Thus it becomes a livelihood issue.
• On the basis of the recommendation taxation,
the GST Council in its 49th and 50th Meeting,
the Compensation Cess rate levied on such
commodities with declared retail sale price has
been linked to retail sale price and is leviable
at a rate ranging from 8% to 69% of retail sale
price.
• In the Union Budget 2023-24, the National
Calamity Contingent Duty (NCCD) rate on
specified cigarettes has been revised upwards
by about 16 percent with effect from
02.02.2023. This change is expected to lead to
increased collections of GST.
• The Fitment Committee recommended to
maintain status quo.
Agenda for 52nd GSTCM Volume 1
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c) Issues deferred by the Fitment Committee for further examination in relation to goods
Annexure – III

S.
No.
Description
of Goods
/HSN
Present
Rate
Requested
Rate
Comments
1 Khari,
Cream
Rolls
[Bakery
products]
(HS 1905)
18% To clarify that
Khari and crème
roll are covered
under “similar
toasted
products”, and
attracts 5% GST
rate
• Fitment Committee examined the issue before the
47th, 48th & 50th GST Council Meetings and
observed that further details regarding the nature of
product, process of preparation is required before
making any suggestions and the matter was deferred
for further examination.
• Currently, concessional GST rate of 5% is
applicable on Rusks, toasted bread and other
toasted products falling under tariff item 1905 40 00.
• Bakery products such as Pastry, Cake, Biscuits,
Communion Wafers, etc. [other than pizza bread,
khakhra, plain chapatti or roti, bread, rusks, toasted
bread and similar toasted products], falling under
CTH 1905, attract GST rate of 18%
• Maharashtra suggested to get the same examined by
Foods Research Institutes.
• The Fitment Committee recommended to defer this
matter.
2. Steel scrap 18% (i) 5% (with
ITC),or
2% (without
ITC),or

5% or 18%
(under RCM

(ii)Exempt
when sold by
dealers and
RCM in last
leg when sold
to
manufacturer,
or

5%, or
• Request to reduce GST rate from 18 % has not
been accepted by GST Council in its 47th
meeting. Therefore, issue of rate reduction has
already been decided. The only issue referred to
Fitment committee for deliberation and making
suitable recommendations is regarding levy of
GST on RCM basis
• Currently, GST rate on scrap [falling under 7204,
7404, 7503, 7802, 7902, 8549] is 18% on forward
charge basis as per section 9(1) of CGST Act,
2017.
• So far, the GST Council has not recommended
reverse charge mechanism (RCM) on the supply
of scrap as per section 9(3) or 9(4) of CGST Act,
2017

Agenda for 52nd GSTCM Volume 1
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1% without
ITC, for
traders only

(iii)Wholesaler
to
manufacture-
option of 18
% FCM or 5%
RCM

Observation by Karnataka & Punjab during 47th GST
Council Meeting:
• Hon'ble Member from Karnataka suggested to do
a detailed study on scrap, where it was used in
manufacturing and in which industries. If this
could be tracked, then there could be a reverse
charge leading to generation of higher revenue.
• The representative from Punjab requested to defer
the issue of RCM and to take it up only after due
consultation

Industry Consultation by Karnataka:
• One of the discussed proposal was to notify
ferrous scrap for GST- TDS @ 2% under Section
51 of the Central Goods and Services Tax Act.
2017 CGST Act. It was opined that with such
tax deduction, the transaction will get in the
reporting chain and the scrap dealers will get
compliant. However, industry rejected this
proposal asserting that it would still leave 16% for
the scrap dealers to continue engaging into the
fraudulent tax practices like claiming irregular
input tax credits to the tune of 16%. Another
discussed proposal was to generate unique batch
numbering for each lot of ferrous scrap at the
source of scrap (i.e. households for obsolete
scrap). It was opined that it would facilitate
traceability of scrap given that each lot will have
a unique ID. The industry rejected this proposal
by asserting that it would involve significant
investment in infrastructure processes and
monitoring. Also, even after such investment,
scrap suppliers could still choose to be non-
compliant.
• Industry informed that it is struggling with the
GST issues related to the category "Obsolete
Scrap" that is discarded when steel products
(appliances, machinery, buildings, bridges, ships,
cans, railway coaches and wagons etc.) have served
their useful life. It is different from “Home Scrap”
and “Industrial Scrap”.
• Accordingly, the industry requested to consider the
following:
 Create distinct classifications for obsolete
scrap and other kinds of scrap for ease of
Agenda for 52nd GSTCM Volume 1
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monitoring and appropriate tax treatment,
and
 Accept one of the two proposals laid
down by the association for obsolete
scrap i.e.
 Reverse charge mechanism on sales
to manufacturers, or
 GST @ 1% without input tax credit.
• State of Karnataka observed that the proposal of
levy of GST on reverse charge mechanism may
not be feasible as the same breaks the chain of
input tax credit and also leads to cascading of taxes
and also breakage of audit trail. However, to
prevent the evasion of tax and to create a
conducive business atmosphere, the following
measures are recommended:
 Introduction and implementation of track and
trace mechanism in the line of tobacco
products as planned Better registration
procedures may be implemented for the
taxable persons in scrap in light of the
amendments done to the registration
process requiring the physical authentication
and presence of the taxpayer before the officer
at the time of registration. This should be
periodically renewed.
 E-waybill should be generated for evasion
prone commodities only if that commodity is
registered to be supplied. Amendments should
be made to incorporate this feature and this
needs physical authentication by the
registering authority.
 With the introduction of not allowing input tax
credit without the invoice being reflected in
FORM GSTR-2B and better registration
procedure in evasion prone commodities, the
menace would come down and the effect of
this mechanism needs to studied
 and a decision on RCM may be taken if there
is no alternative but to disturb the status quo,
at a later date. This is because RCM is always
distortionary.

• Punjab has suggested to tax iron and scrap on
RCM and exempt supply of scrap in the hands
of traders. Under RCM, the manufacturer will
have the liability to pay tax and this is
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administratively efficient to boost tax collection.
Further, e -way bill should be mandatory for all
transactions in scrap irrespective of value.
• Fitment Committee observed that RCM is not
feasible but acknowledged that some solution should
be found to address the problems of the industry.
• Accordingly Fitment Committee decided to
create a sub-Committee of officers to study the
issue holistically and to come up with workable
solution.
• The Sub Committee has met on two occasion and is
likely to submit its report shortly. .
Agenda for 52nd GSTCM Volume 1
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d) Recommendations made by the Fitment Committee for making changes in GST rates or
for issuing clarifications in relation to services
Annexure-IV
Sl.
No.
Proposal Details of Request Discussions in Fitment Committee and
its recommendations
1. a. To notify a
mechanism for
availment/
utilisation of ITC
in cases where
passenger
transportation
services by AC
buses are
supplied through
an ecommerce
operator (ECO).

b. To shift the
onus of
discharging GST
on the registered
bus operators
providing
passenger
transportation
service through
ECOs
W.e.f 01.01.2022, the
liability to pay tax in respect
of passenger transportation
services provided by AC
buses has shifted from bus
operator to ECO. As a
result, ITC of input services
and goods are getting
accumulated as there is no
mechanism on GST portal
to transfer ITC to ECO for
payment of tax. ITC
accumulation is more
pronounced in the case of
electric bus operator as the
cost of electric buses is 2-3
times more than other
buses.

Alternatively, the onus to
discharge GST on sale of
tickets for passenger
transport service through
ECO may be shifted to the
registered bus operators.
• Passenger transport services attract GST
at the rate of 5% with ITC of input
services in the same line of business or
12% with full ITC.
• W.e.f 01.01.2022 bus transportation
service through ECOs has been notified
under section 9(5) of CGST Act, 2017
thereby making ECOs liable to pay GST
on the service.
• Bus transportation service supplied
through ECO was notified under section
9(5) on the representation of the industry
that most of the bus operators supplying
service through ECO owned one or two
buses and were not in a position to take
registration and meet GST compliance
requirements.
• Representations have been received
from two entities both of which are
companies stating that they supply
services through ECO as much as
through offline and due to notification of
their service under section 9(5), they are
not able to fully utilize their ITC. This
accumulation of ITC is more
pronounced in case of electric buses
which are two/ three times costlier than
ordinary buses.
• It has been requested that like hostel
accommodation, where hostels having
turnover over the registration threshold
have been excluded from the purview of
section 9(5) of CGST Act, 2017,
registered bus operators may be
excluded from provisions of section 9(5)
of CGST Act, 2017.
• However, in case of bus transport
services, an operator operating even a
single bus will be above the registration
threshold. Excluding registered bus
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No.
Proposal Details of Request Discussions in Fitment Committee and
its recommendations
operators or operators above the
registration threshold from purview of
section 9(5) may defeat the twin
objectives of (a) collecting tax from a
single point (ECO) rather than a large
number of unorganized small operators
spread across the country and (b) ease of
doing business for small businesses.
• To arrive at a balance between the need
of small operators for ease of doing
business and the need of large organized
players to take ITC, Fitment committee
recommended that companies may be
excluded supplying passenger transport
services by a motor vehicle from the
purview of section 9(5) of CGST Act,
2017.
• While examining this issue, Fitment
Committee has found that GST rate of
5% with credit of input services in the
same line of business is leading to
inversion of tax and credit accumulation.
One of the reasons for this is that input
services in the same line of business
attract GST at rates higher than
5%.Fitment committee recommended
that where GST on input service in the
same line of business is payable/paid by
the supplier of input service at a rate
higher than 5%, the supplier of
passenger transport service by any motor
vehicle would be entitled to ITC only to
the extent of such amount of GST as
would have been payable on the input
service in the same line of business at the
rate of 5%.
• Further, same line of business has been
described in the entry as “service
procured from another service provider
of transporting passengers in a motor
vehicle or renting of a motor vehicle”. It
may be clarified through a circular that
input services in same line of business
include transport of passengers (SAC
9965) or renting of motor vehicle with
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Proposal Details of Request Discussions in Fitment Committee and
its recommendations
operator (SAC 9966) and not leasing of
motor vehicles without operator (9973),
which attracts GST at the same rate as
sale of motor vehicles, that is, 28% plus
compensation cess.
2. To clarify
whether
reimbursement of
electricity
charges received
by the Real estate
companies,
malls, airport
operators etc.
from their
lessees/occupants
is exempt from
GST.


In terms of Sl. No. 13 of
notification No. 11/2017
Central Tax (Rate) dated
28/06/2017 and pari
materia state notifications
issued in this regard
(hereinafter referred to as
the ‘Rate Notification’),
Electricity, gas, water and
other distribution (under
Heading 9969) is taxable @
18%.

In terms of Sl. No, 25 of
notification No. 12/2017-
Central Tax (Rate) dated
28/06/2017 and pari
materia state notifications
issued in this regard
(hereinafter referred to as
the ‘Exemption
Notification’)
“Transmission or
distribution of electricity by
an electricity transmission
or distribution utility”
(under Heading 9969) is
exempt from levy of GST.

Real estate companies
supply electricity to their
short term and long-term
lessees. These companies
take High Tension line from
Electricity Distribution
Companies (DISCOMs)
and convert the same into
• Calcutta High Court in the case of
Srijan Realty (P) Ltd. Vs.
Commissioner of Service Tax, has
held vide order dated 08.03.2019 that
an entity not licensed/authorized to
supply or distribute or trade electricity
cannot be supplying electricity as
goods and the same has to be
considered as a supply of service.
• However, it is seen from the Delhi
Electricity Regulation Commission
(Supply Code and Performance
Standards) Regulations, 2017, that
developers including private
developer, private colonizers, builders,
Cooperative Group Housing societies,
group housing societies, co-operatives,
associations etc., may obtain a single
point supply of electricity from the
distribution licensee, for premises with
multiple consumers/ beneficiaries such
as multi -storey building, residential or
residential cum commercial complex,
Commercial or Industrial Complex etc.
and supply the same to individual
consumers/beneficiaries by installing
separate sub-meters. Therefore, it
appears that in Delhi and other states
having similar regulations, the ratio of
the Calcutta High Court judgment may
not apply.
• The West Bengal AAR Order dated
08.08.2023 in the matter of Airports
Authority of India, has held that nature
of supply of transmission or
distribution of electricity by AAI to its
licensees/ tenants is that of a composite
supply, where the principal supply is
that of providing license to use the
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Proposal Details of Request Discussions in Fitment Committee and
its recommendations
Low Tension line in
transformers and through
panels the same is being
distributed to the sub
lessees/occupants for their
consumption.

DISCOMs bill directly to
the real estate companies,
who in turn bill to the end
consumers on the basis of
actual units consumed by
the property occupants
within their offices/units as
per the reading recorded in
the sub meters installed at
their premises, at the same
rate at which DISCOMs
billed them or at a higher
rate citing several reasons
such as, “Transmission/
Distribution Loss”.

Doubts are being raised on
the applicability of GST on
the aforesaid further supply
of electricity by the real
estate companies to their
lessee or occupants on
whose inward supply no
GST was leviable.
specified premise by the licensee/
tenant and supply of electricity is
naturally bundled in conjunction with
the aforesaid supply.
• Fitment Committee recommended to
clarify that whenever electricity is
being supplied with renting of
immovable property and/or
maintenance of premises etc. it forms a
part of composite supply where the
principal supply is renting of
immovable property and/or
maintenance of premise etc. and the
supply of electricity is an ancillary
supply. Even if electricity is billed
separately, the supplies will constitute
a composite supply and therefore, the
rate of the principal supply i.e., GST
rate on renting of immovable property
and/or maintenance of premise etc.
would be applicable.
• However, where the real estate owner
supplies electricity as pure agent in
accordance with Rule 33 of CGST
Rules, 2017, it will not form part of
value of his supply.
3. Exempt services
provided by
District Mineral
Foundations
from GST

A District Mineral
Foundation (DMF) Trust is
established by the State
Government under section
9B of the MMDR Act,1957,
with an objective to work
for the interest and benefit
of persons and areas
affected by mining related
operations by regulating
receipt and expenditure
• The 45th GST Council (SI.No.7 of
Annexure-VI, Agenda No. 14) had
deferred the matter with directions to
obtain details about the nature of
activities undertaken by DMF from
Odisha.
• Government of Odisha, vide letter No.
FIN-CT1-TAX-0030-202323474/F
dated 21.08.2023 (Appendix-III) has,
inter-alia, informed as under:
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its recommendations
from the respective Mineral
Development Funds created
in the concerned district.
They provide services
related to drinking water
supply, environment
protection, health care
facilities etc.

• DMF Fund of the district is an
extra-budgetary resource to be
utilized for the interest and benefits
of the mining affected people and
areas. Other extra-budgetary
sources include Compensatory
afforestation Fund Management
and Planning Authority (CAMPA),
Odisha Mineral Bearing Areas
Development Corporation, Odisha
State Agricultural Marketing
Board, Building and Other
Construction Workers Welfare
Board etc.
• DMF Trusts have been constituted
in all the districts of Odisha to
implement various developmental
and welfare programmes in mining
affected areas. DMF Trusts with
approval from DMF Trust Board
take up permissible activities
directly (through NGOs, PSUs,
private organizations etc.) and
indirectly (by funding line
ministries, departments of State
Governments) in mining affected
areas.
• Activities undertaken by DMF
include
o drinking water supply
o environment preservation
and pollution control
measures
o health care
o education
o welfare of women and
children
o skill development,
sanitation
o road connectivity
o energy and watershed
development
o afforestation
o physical infrastructure
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Proposal Details of Request Discussions in Fitment Committee and
its recommendations
o supply of medical
equipment, instruments &
furniture to PHCs/CHCs.
o infrastructural support for
education sector through
capacity building of
teachers, construction of
hostels, science labs etc.
o construction of Old Age
home, rescue/
rehabilitation centre.
• Activities are similar to activities
that are enlisted in Eleventh
Schedule and Twelfth Schedule of
the Constitution.
• Most of these activities are
implemented by Government Line
Departments. Some of these
services are being implemented
through NGOs, PSUs, Private
Organizations selected through
tendering process. The ultimate
users of the various schemes under
DMF are individuals, families,
women and children,
farmers/producer groups, SHGs of
the mining affected areas etc. The
services/supplies out of DMF fund
are provided free of charge and no
consideration is realised from the
beneficiaries by DMF against such
services. The value of goods and
services supplied by Implementing
Agencies in the last two years for
major 8 districts (where 99% of the
DMF Fund is accrued or allocated
for various projects) stands at Rs.
6685 crores and GST has been paid
to the extent of Rs. 776 crores.

• Fitment Committee recommended to
clarify that DMFT is a governmental
authority and thus eligible for the same
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Proposal Details of Request Discussions in Fitment Committee and
its recommendations
exemptions as available to any other
Governmental Authority.
4. To clarify that
job work for
processing of
“Barley” into
“Malted Barley”
is covered under
entry no. 26(1)(f)
of notification
no. 11/2017-
CT(R) dated
28.06.2017
which covers
“jobwork
services in
relation to food
and food
products” and
thus attracts GST
@ 5%.
or
In the event it is
held that GST
@18% is
leviable, to
regularize past
supplies on as is
basis.

Barley malt manufacturing
process comprises of (a)
cleaning of raw barley ;(b)
steeping of cleaned barley;
(c) germination and (d)
kilning.

Job work practice in the
malt manufacturing
industry is to receive raw
material barley from
principal and manufacture
into malt, thus providing
job work services to convert
barley into malt.

Malt is used for various
purposes. Apart from being
used as raw material by
brewing and distilling
industry, malt is utilized in
production of chocolate,
breakfast cereal, malted
drinks like Horlicks, Boost,
Milo and cocoa-malt drinks
like Bournvita.

They are entitled to 5%
GST rate as applicable to
services by way of job work
in relation to all food and
food products falling under
Chapters 1 to 22.
In the event, it is held that
GST at 18% is leviable , to
regularize the past supplies
on as is basis, as they are
• The issue involved is whether services
by way of jobwork for conversion of
barley into malt attracts GST at 5%
prescribed for "job work in relation to all
food and food products falling under
Chapter 1 to 22 of the customs tariff" or
at the rate of 18% prescribed for
"services by way of job work in relation
to manufacture of alcoholic liquor for
human consumption.
• Apart from being used as raw material
by brewing and distilling industry, malt
is utilized in production of chocolate,
breakfast cereal, malted drinks like
Horlicks, Boost, Milo and cocoa-malt
drinks like Bournvita. Malt is also used
in the manufacturing of infant food,
weaning baby food, medicinal syrup.
Additionally, malt flours are used to add
flavor and browning in baked goods
such as yeast bread, biscuits and cakes as
well as in cereal production.
• Malt falls in chapter 11 of Customs
Tariff (Malt-whether or not roasted,
HSN 1107 1000 and 11072000).
• GST rates of the end products
manufactured using barley malt are as
under:
o Malt (whether or not roasted)
(HSN 1107 1000 and
11072000): 18%
o Maltose (HSN 1702) : 18%
o Malt extract, Food preparations
of flour, groats, meal, starch or
Malt extract (HSN 1901): 18%
o Malto dextrin Syrup (HSN 2106)
: 18%
o Beer, Liquor : Outside ambit of
GST at present.
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its recommendations
not in position to collect
differential duty from their
customers and will lead to
closure of units.
• A substantial part of malt is used for
manufacture of alcoholic liquor for
human consumption.
• Malt manufacturers who carry out job
work for liquor have requested for
clarification based on notices received
by them demanding 18% GST under
the entry covering job work services in
relation to manufacture of alcoholic
liquor for human consumption .
• As per sciencedirect.com:
“…
Malting involves the sprouting
(germination) of grain in moist air, under
controlled environmental conditions. The
malt is generally dried to produce a shelf-
stable product.
…
In addition, many micronutrients are made
more available through malting. Although
malting is primarily used for the beer-
making process, malt can be used
as food or added to other grain foods to
improve their nutritional value
…
Not only is malt itself a nutrient-rich food,
it can be added to unmalted grain foods to
improve their nutrient density and
palatability. In this application, malt is
referred to as power flour or amylase-rich
flour. Power flour is particularly useful for
porridge-based infant weaning foods and
for the elderly and infirm.
…”
• It is a settled position that a specific
entry for any goods or services should
be given preference over a general or
less specific entry.
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its recommendations
• Fitment Committee recommended to
clarify that job work services in
relation to manufacture of malt are
covered by the entry at Sl. No. 26 (i)
(f) “which covers job work in relation
to all food and food products falling
under chapters 1 to 22 of the customs
tariff” irrespective of the end use of
that malt.
• Fitment also recommended to
regularise past assessments of job
work services in relation to
manufacture of malt on as is basis.
Supplies on which tax has been paid at
5% will be considered as fully GST
paid and at the same time, no refund
shall be given of taxes already paid at
GST rates higher than 5%.
5. To specify a
positive list of
services under Sr.
No. 3 & 3A of
notification No.
12/2017-Central
Tax (Rate)
• This issue has been discussed in the 45th,
47th and 48th GST Council meetings held
on 17.09.2021, 28&29.06.2022 and
17.12.2022 respectively. A detailed
background note (Appendix-IV) on the
issue including the views of the States,
the details of deliberations in the Fitment
Committee meetings and
recommendations made by the Fitment
Committee based thereon, deliberations
and directions of GST Council meetings
on the issue is annexed.
• In the 50th GST Council meeting held
on 11.07.2023, it was suggested by
Karnataka that the exemption entries at
3 and 3A of notification No. 12/2017-CT
(R) should continue to cover all the
activities specified in the 11th and 12th
Schedule of the Constitution and that the
words “in relation to” appearing in entry
3 and 3A of Notification No. 12/2017-
CT (R) may be substituted by the words
“by way of” to remove difficulties
caused by wide interpretation of the
phrase “in relation to”.
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• The issue was discussed in detail. It was
felt that replacing the words “in relation
to” in Sl. No. 3/3A of notification No.
12/2017-CTR dated 28.06.2017 with the
words “by way of” may create more
confusion and disputes as Sl. No. 3/3A
of notification No. 12/2017-CTR dated
28.06.2017 will then read as “service by
way of minor forest produce”, “services
by way of fuel and fodder”, “services by
way of markets and fairs” which will
have no meaning.
• After detailed deliberations, Fitment
recommended that entries at Sl. No. 3
and 3A of notification No. 12/2017-CTR
dated 28.06.2017 may be retained as
they are with no change.
• Fitment Committee also recommended
that a new entry may be created to
exempt following five services supplied
to Governmental Authority:
• Water Supply
• Public health
• Sanitation Conservancy
• Solid waste management
• Slum improvement and
upgradation
6. Request to bring
supplies made by
Indian Railways
under forward
charge
mechanism from
the existing
reverse charge
mechanism.


Indian Railways in addition
to transportation services
also provides various other
services such as issue of
licenses for catering,
renting of immovable
property, sale of old and
used goods etc.; GST on
which is payable under
reverse charge basis.

As per Section 17(3) of
CGST Act, 2017 supplies
liable to GST under RCM
• Entry at Sr. No. 5 of notification No.
13/2017-CTR provides that services
supplied by the Central Government,
State Government, Union territory or
local authority to a business entity,
excluding a few specified services shall
be taxed under RCM in the hands of the
business entity.
• One of the services supplied by
government which is taxable under
forward charge mechanism is transport
of goods or passengers including by
Railways.
• Entry at serial no. 6 of notification No.
4/2017-CTR provides that supply of
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are treated as exempt
supply for purpose of ITC
availment and thus
expenditure incurred in
respect of supplies liable to
RCM is liable to be
reversed.

Inability of Indian Railways
to avail ITC on account of
RCM along with other
reasons such as exempt
supplies has led to blockage
of huge amount of ITC.

It is estimated that the
burden on Indian Railways
on account of ineligibility
of ITC on RCM is approx.
1300 crores annually.
It is requested that all
supplied made by Indian
Railways may be brought
under forward charge.
Similar facility was
extended recently to
services supplied by
Department of Posts.
used vehicles, seized and confiscated
goods, old and used goods, waste and
scrap by government (which includes
IR) to a registered person shall be liable
to be taxed under RCM in the hands of
the registered person.
• As a result, only services of transport
supplied by Indian Railways are taxable
under forward charge. Other services
supplied by Indian Railways such as
renting of immovable property, grant of
catering licenses and sale of old and used
goods are under RCM.
• As informed by Railways, ITC of
approx. Rs. 1300 crores is getting
blocked due to RCM liabilities.
• The issue has been deliberated in the
Fitment Committee and it is
recommended that all goods and services
supplied by Indian Railways may be
brought under forward charge.
• Recently, services by Department of
Post have also been brought under
forward charge on recommendations of
the 47th GST Council.
• Certain exemptions on services supplied
by government (which included IR) to
individuals, unregistered business
entities having turnover below the
registration threshold, services valued at
Rs 5000 or less (Rs. 5000 in a year in
case of continuous supply of service)
have been given so as to ensure that
individuals or small unregistered
businesses are not required to take
registration to pay GST on them under
RCM. Similarly, services by Central
Government, State Government, Union
Territory or local authority to another
Central Government, State Government,
Union Territory or local authority have
been exempted as services supplied by
Central Government, State Government,
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Union Territory or local authority are
generally under RCM.
• In case, it is decided to tax all goods and
services supplied by Indian Railways
under forward charge, Indian Railways
may be excluded from the above
exemptions; otherwise, it would defeat
the purpose of bringing all supplies of
Indian Railways under forward charge
mechanism.
• Accordingly, Fitment Committee
recommended that,-

(i) All goods and services supplied
by Indian Railways may be
brought under forward charge.
(ii) Indian Railways may be
excluded from the aforesaid
exemptions.
7. Request for
clarification on
entry 54(g) of
12/2017-CT(R)
dated 28.06.2017
with regard to the
scope of
exemption for
commission
agent in
facilitating the
sale of
agricultural
produce.
Central Arecanut & Cocoa
Marketing & Processing
Co-operative Ltd. popularly
known as CAMPCO is a
multi-state cooperative of
the two states of Karnataka
and Kerala . The main
activity of CAMPCO is
purchasing and selling
arecanut, cocoa, rubber and
pepper in their primary
form and grown by their
members in both the states.
CAMPCO markets
arecanut grown in the two
states through their
authorized selling
representatives (SRs)
known as Commission
Agents. For the service
rendered by the Agents,
commission is paid after
• CAMPCO is a multi-state cooperative of
growers of arecanut, pepper, rubber and
cocoa etc. It purchases arecanut directly
from agriculturists and sells it to buyers
in northern parts of India through its
Selling Representatives (SRs).
• According to CAMPCO, they do grading
and packaging of arecanut in standard
bags before supplying it to buyers
without altering its essential
characteristics.
• Show cause notices have been issued to
the SRs of CAMPCO demanding GST
on the commission charged by the SRs
from CAMPCO.
• The issue was deliberated in the Fitment
Committee and it was felt that CAMPCO
may be advised to approach Authority
for Advance Ruling.
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deducting TDS u/s 194H of
the Income Tax Act,1961.
The term “commission
agent” has not been defined
in the CGST/IGST Acts.
However, the term “agent”
has been defined under
section 2(5) of the CGST
Act, as under:
• “(5) “agent” means a
person, including a
factor, broker,
commission agent,
arhatia, del credere
agent, an auctioneer or
any other mercantile
agent, by whatever
name called, who
carries on the business
of supply or receipt of
goods or services or
both on behalf of
another.”
The SRs who act as
commission agents for sale
of agricultural produce viz.
arecanut and pepper, by
CAMPCO are covered by
the definition of “agent”.
Since the exemption is
granted to commission
agents, the SRs are
exempted from payment of
GST on the services of
commission agent provided
by them to CAMPCO.
In the instant case, the
selling
representatives/commission
agents are providing
services of facilitating the
sale of agricultural produce.
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Hence, the activities
undertaken by the selling
representatives/commission
agents of CAMPCO as
narrated supra would fall
within the ambit of
exemption entry Sl.No.
54(g) of notification
12/2017-CT(R) dated
28.06.2017.
8. To clarify
applicability of
GST on
Horticulture
Contracts of
CPWD

• Horticulture
development and its
maintenance at all
government premises
(residential and non-
residential) are taken
care of by the
Horticulture unit of
CPWD.
• These horticulture
related works are
carried out through
outsourcing contracts
wherever the regular
workers are not
available. Such
contractual agreements
are drawn observing
formalities as
prescribed in CPWD
manual and prevailing
GFR guidelines.
However, the nature
and scope of
horticulture works
performed by
gardeners, dealing with
perishable and living
plants is significantly
different from other
construction related
works.
• Maintenance of
community assets,
• Public parks in government residential
colonies, government offices and other
public areas such as India Gate lawns,
Raj Ghat and other Samidhi Sthals are
developed and maintained by CPWD.
• Maintenance of community assets,
urban forestry, protection of the
environment and promotion of
ecological aspects are functions
entrusted to Panchayats and
Municipalities under Article 243G and
243W read with Sr. No. 29 of 11th
Schedule and Sr. No. 8 of 12th Schedule
of the constitution.
• Sr. No. 3 and 3A of notification No.
12/2017-CTR exempt pure services and
composite supply of goods and services
in which value of goods does not
constitute more than 75%, provided to
the Central Government, State
Government or Union territory or local
authority by way of any activity in
relation to any function entrusted to a
Panchayat under article 243G of the
Constitution or in relation to any
function entrusted to a Municipality
under article 243W of the Constitution.
• Fitment Committee recommended to
clarify to CPWD that supply of pure
services and composite supply of
horticulture/horticulture works (where
the value of goods constitutes not more
than 25 per cent of the total value of
supply) to CPWD in relation to any
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urban forestry and
protection of
environment and
promotion of
ecological aspects are
listed in the 11th and
12th Schedule of the
constitution.
Horticulture units working
under CPWD are located
across the country and
execute different kind of
horticulture related works
on day-to-day basis for
example development of
lawn, preparation of beds,
new plantation, supply of
different kind of foliage,
indoor, ornamental plants
and potted plants for
display at different sites etc.
function entrusted to a Panchayat under
article 243G of the Constitution or in
relation to any function entrusted to a
Municipality under article 243W of the
Constitution are exempt from GST
under Sr. No. 3 and 3A as they exist
today.
9. Amendments to
notification No.
11/2017-CT(R)
dated 28.06.2017
consequent to
amendment of
CGST Act, 2017
• In GST, ‘goods’ by definition include
actionable claims. Therefore, supply of
actionable claims by way of lottery,
betting and gambling is a supply of
goods. The rate for them is prescribed
in Sl. No. 228 and Sl. No. 229 of
Schedule IV of the goods rate
notification No. 1/2017-CT (R) dated
28.06.2017.
• However, the following entries also
figure in services rate notification No.
11/2017-CT(R) dated 28.06.2017:
o Entry at Sl. No. 34 (iv) which
specifies GST rate of 28% for
“services provided by a race club
by way of totalizator or a license to
bookmaker in such club”.

Supply by a race club by way of
totalizator is supply of actionable
claims (i.e. goods) and not services.
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Therefore, this entry may be
rationalized as
“Services provided by a race club
by way of licensing a bookmaker in
such club”
o Sl. No. 34(v) which specifies GST
rate of 28% on “gambling”.

This entry may be omitted as
‘gambling’ is also included in Sl.
No. 229 of goods rate schedule.
Secondly, the definition of
‘specified actionable claims’
inserted vide CGST Amendment
Act, 2023 also includes gambling.
• The issue was deliberated in the
Fitment Committee meeting held on
26.09.2023 and the proposed
amendments were agreed upon.



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e) Issues where no change has been proposed by the Fitment Committee in relation to
services
Annexure-V
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1. To apply uniform
GST rate of 5% on
Business
Correspondent
services provided in
both rural/urban
areas.


Presently, 18% GST is applicable
on the entire chain of banking
services irrespective of the fact
that services are being offered by
the banking company or their
banking correspondent (BC). With
regard to the GST applicable on
the service provided by Banking
Correspondents, DoR vide its
Notification/ Circulars has inter-
alia notified the following:
Notification No. 12/2017 dated
28.6.2017 and Circular No.
86/5/2019-GST dated 1.1.2018
reads as follows:
“(i) Exemption of GST on
services provided by business
facilitator or a BC to a
banking company with respect
to the account in its rural
areal branch. The procedure
for classification of branch of
a bank as located in rural area
and the services which can be
provided by BC is governed by
RBI guidelines.
(ii) Notification No. 28/2018-
Central Tax (Rate) dated
31.12.2018: Services provided
by banking company to Basic
saving Bank Deposit (BSBD)
account holders under
Pradhan Mantri Jan Dhan
Yojana (PMJDY) are
exempted from GST.”
Under the present notification,
there are difficulties in availing the
benefit of GST exemption as
• Services supplied by Business
Correspondent/ Business Facilitator
(BC/BF) attract 18% GST as per
entry 15(vii) of notification No.
11/2017 CTR dated 28.06.2017.
• Further, Sl. No. 39 of notification No.
12/2017- CTR dated 28.06.2017
provides a specific exemption for
services provided by BC/BF to
banking companies in respect of rural
area branches. The said entry reads as
below:
Services by the following persons in
respective capacities –
(a) business facilitator or a business
correspondent to a banking company
with respect to accounts in its rural
area branch;
(b) any person as an intermediary to
a business facilitator or a business
correspondent with respect to
services mentioned in entry (a); or
(c) business facilitator or a business
correspondent to an insurance
company in a rural area.
• The issue was examined in the
Fitment Committee and it was felt
that the specific exemption for
services provided by BC/BF to
banking companies in respect of rural
area branches has been given in line
with the objectives of financial
inclusion. There appears to be no
merit in the request to apply uniform
GST rate of 5% on Business
Correspondent services provided in
both rural/urban areas.
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Indian Financial System Code
(IFSC) does not distinguish rural
accounts. As a result, the waiver
goes unutilized as banks and
BCs/CSPs pay up on all
remittances to avoid any
compliance wrangle.
In recent years, financial inclusion
and Digital Banking Service have
increased rapidly in the country
especially in the rural areas.
Banking Correspondents have
proved to be tried and tested model
and contributed immensely in door
step delivery of various banking
services including DBT transfer.
In view of the crucial role being
played by BCs. GST council may
consider to apply a uniform 5%
GST rate to all banking services
offered at BC Agent outlets,
irrespective of whether they
pertain to accounts from
rural/urban areas or PMJDY as the
BC Agent services are majorly
used by the poorer strata of the
society.
• Fitment Committee recommended to
maintain status quo.
2. To bring renting of
residential dwellings
by registered persons
to registered persons
under Forward
Charge Mechanism.


It has been submitted that there are
various registered persons like
body corporates who are engaged
in the business of renting of
residential dwellings to other
registered persons like body
corporates who further give these
dwellings on rent to their
employees for residence.
In view of the amendment in
notification no. 13/2017-Central
Tax (Rate) dt. 28.07.2017, vide
notification no. 05/2022 CTR
dated 13.07.2022, henceforth such
transactions of renting of
• The representing association was
asked to give specific instances
where trade/business has found
difficulty in implementation of the
said notification dated 13.07.2022.
• No real life examples or difficulties
in implementation of the said
notification were brought to notice by
representing association.
• The issue was examined in the
Fitment Committee wherein it was
recommended to maintain status quo.
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residential dwelling by registered
person to a registered person
would be liable to GST under
reverse charge and accordingly,
these transactions would be
considered as exempt supply for
the service provider i.e. a
registered person.
This would adversely affect such
registered persons who are in this
business, since the ITC on the
input services would not be
available as the output supply is
considered as exempt supply being
taxed under reverse charge. This
would not only affect the business
of such registered persons but will
also increase the cost of rent in the
hands of the employee as an
individual to whom this residential
dwelling is ultimately rented if the
rent is recovered from the
employee.
In order to avoid cascading effect
of taxes, where a registered person
is making a further supply to
another person of the same
category of service, viz. renting of
residential premises, the input tax
credit should be eligible to the
recipient of service. For the same,
such renting transactions should be
made liable to GST under forward
charge and not under reverse
charge.
3. To clarify that 'sale
of land' at Entry No.
5 of Schedule III of
the CGST Act
includes assignment
Vide the said representations it
has been submitted that
“assignment of leasehold rights in
land” is akin to “sale of land” and
covered by Entry No. 5 of
• Transactions in immovable property
other than sale of building and land are
taxable under GST.
• Sale of land and lease of land are not
the same thing. While sale of land
results in transfer of title to land along
with all the benefits arising out of it,
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of leasehold rights in
such land.


Schedule III of the Central Goods
and Services
Tax, Act 2017 (hereinafter
referred to as ‘CGST Act, 2017’).

The activity of assigning leasehold
rights in land is also a beneficial
interest in land and should also
qualify as “land”. Accordingly, the
transaction of assignment of
leasehold rights in land should
qualify as ‘sale of land’ and GST
should not be leviable as per Entry
No. 5 of the Schedule III of the
CGST Act, 2017.
the lease of land, does not result in
transfer of title to that land or all
rights/benefits arising out of it.
• The actual control to dispose of or sell
the immovable property lies with the
owner of the land. The lessee cannot
sell the land.
• Supply of service is taxable if two
conditions are fulfilled, -
i. There must be a supply of
service by the service provider to
service recipient and,
ii. Service recipient pays a
consideration in cash or kind to
the service provider.
• In case of lease of land given by lessor
to a lessee, both the above two
conditions get fulfilled. Lessee is
allowed to use the land and lessor
receives consideration from the
Lessee, and therefore, it constitutes a
supply under section 7 of the CGST
Act, 2017.
• Lease of land was taxable in Service
Tax regime also.
• Schedule II , para 2 clearly states that
–
“….
(a) any lease, tenancy, easement,
licence to occupy land is a supply
of services;
(b) any lease or letting out of the
building including a commercial,
industrial or residential complex
for business or commerce, either
wholly or partly, is a supply of
services.”
• The issue was discussed in the Fitment
Committee and it was of the opinion
that question of lease of land being
covered under entry 5 of Schedule III
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which deals with sale of land and
building does not arise.
• Fitment Committee recommended not
to accede to the request.
4. Request to provide
exemption from GST
on the reassignment
of leasehold rights of
land where the initial
lease was exempt
from GST vide entry
at SI. No. 41 of
Notification No.
12/2017-Central Tax
(Rate)
It has been submitted that the
members had obtained land on
long-term lease for industrial
purpose from various State
Government Industrial
Development Corporations [such
as MIDC] for conducting its
business operations. Such
members have assigned the right
in land to various parties for
consideration.

The initial lease of such land from
MIDC is exempt under GST. If the
initial lessor uses the land for his
own purpose for 99 years, there
will be no revenue on account of
CST that will accrue to the
Government.
However, if the lessor further
assigns the leasehold rights in the
land, say, after 20 years and
collects consideration equal to the
proportionate amount of lease
premium paid to MIDC for the
remaining 79 years of lease, the
same is currently not exempt from
payment of CST.

Therefore, it has been requested to
grant exemption in case of
assignment of leasehold rights in
land where the initial lease was
exempt from GST
• Entry at SI. No. 41 of Notification
No. 12/2017-Central Tax (Rate)
dated 28.06.2017 exempts long term
lease of industrial plots or plots for
development of infrastructure for
financial business, by the State
Government Industrial Development
Corporations or Undertakings or by
any other entity having 20 per cent,
or more ownership of Central
Government, State Government,
Union territory.
• This entry does not cover
reassignment or sub-leasing of
leasehold rights of land by the lessee.
• Exemption from GST on the
reassignment of leasehold rights of
land where the initial lease was
exempt from GST will encourage
hoarding of industrial plots for the
purpose of re sale and defeat the
objective of promoting and setting
up of industrial units.
• Fitment Committee did not
recommend any change.
• During the discussion on the issue, a
query arose whether ITC of lease of
industrial plots is available or
blocked by Section 17(5) of CGST
Act, 2017. On the said issue of
whether ITC of lease of land is
available, Fitment Committee
recommended to refer the same to
Law Committee.
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5. Request from State
of Nagaland to keep
the rate of GST @
12% on works
contract services
which commenced
prior to 18.07.2022.


In the said request, it has been
stated that the enhanced rate of
GST @ 18% should not be levied
for works contract started prior to
18.07.2022 in the State of
Nagaland.

It has been informed that working
season in state like Nagaland is
short due to rains and due to
resource constrains these works
spill over one financial year to
another.

Therefore, increased rate of GST
will cost 6% more on the budgeted
amount for large number of
ongoing works as order were
issued prior to 18.07.2022.

• Based on the recommendations of the
GoM on Rate Rationalisation and the
47th GST Council meeting, held in
June, 2022, the rate of GST on works
contract services for construction of
roads, bridges etc. and on works
contract services supplied to Central
and State Governments for specified
projects has been increased from 12%
to 18% w.e.f. 18th July, 2022 vide
notification No. 3/2022 CTR dated
13.07.2022.
• Similar issue was examined and not
acceded to by the GST Council in 47th
meeting of GST Council held on 28-
29 June, 2022. The Council did not
agree to the proposal to apply the
increased rate of GST on works
contract services only to contracts
entered into after the date of increase
of rate for following reasons:

o GST law clearly
provides for the manner
in which continuous
supply are subject to
GST in case of rate
change. The standard
rate of 18% will apply
only to the invoices
issued for such
construction on or after
18-7-2022.
o Any request, if agreed
for one sector, would
invite similar request
from other sectors.
o There are similar
requests for
grandfathering in solar,
renewable energy and
other sectors. Further, in
goods also in case of any
rate increase, the
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taxpayers seek
continuation of lower
rate of all goods in the
pipe lines, i.e. cleared
from factory but pending
in supply chain. Their
request has not been
accepted.
 If 12% rate is continued for old
contracts, multiple rates of 12%
and 18% would be there for many
years in future leading to
complex rate structure.
• Fitment Committee
recommended to maintain status quo.
6. Clarification has
been sought on
whether GST is
applicable on the
statutory collections
made by the Real
Estate Regulatory
Authority (RERA) in
accordance with the
Real Estate
(Regulation and
Development) Act,
2016.

• RERA is a statutory authority
established under Real Estate
(Regulation and
Development) Act, 2016
enacted by the Parliament for
the regulation and promotion
of the real estate sector with a
mandate to discharge its
statutory functions prescribed
in the above Central Act and
the Rules and Regulations
made by the respective state/
UT government.
• Under the said regulation, real
estate projects and real estate
agents have to get themselves
registered with the (RERA)
for which they get a
registration/renewal fee. They
also collect penalty in case of
failure to register or acting in
contravention of the
provisions of the Real Estate
(Regulation and
Development) Act, 2016.
• The fees collected get credited
to the Real Estate Regulatory
• Entry 4 of notification No.12/2017
exempts “services by Central
Government, State Government,
Union Territory, local authority or a
governmental authority by way of
any activity in relation to any
function entrusted to a municipality
under article 243W of the
constitution”.
• Governmental Authority has been
defined as “an authority or a board
or any other body,––
(i) set up by an Act of
Parliament or a State
Legislature; or
(ii) established by any
Government
with ninety per cent or more participation
by way of equity or control, to carry out
any function entrusted to a municipality
under article 243W of the Constitution.”
• As per section 34 of Real Estate
(Regulation and Development) Act,
2016 functions performed by RERA
include:
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Fund and all the penalties get
credited to the consolidated
funds of the states.
• The statutory function of
regulating the real estate
development and construction
of the building entrusted to the
RERA falls squarely under
Entry No.1 and 2 of the
Twelfth Schedule of the
Indian constitution read with
Article 243W, as below:
o Urban planning and town
planning;
o Regulation of land-use
and construction of
buildings.
• Services by Central
Government, State
Government, Union territory,
local authority, or a
governmental authority by
way of any activity in relation
to any function entrusted to a
municipality under Article
243W of the constitution is
exempt from levy of GST vide
entry 4 of the notification
No.12/2017-CTR.
Certain CGST authorities in a few
states have initiated proceedings to
assess GST liability on RERA's
statutory collections. This has
raised concerns among the
association members, who are
entities regulated under the Central
Act. No. 16 of 2016.
“(a) to register and regulate real estate
projects and real estate agents registered
under this Act;
...
(f) to ensure compliance of the
obligations cast upon the promoters, the
allottees and the real estate agents under
this Act and the rules and regulations
made thereunder”

• RERA has claimed that their
statutory function of regulating the
real estate development and
construction of the building entrusted
to the RERA falls squarely under
Entry No.1 and 2 of the Twelfth
Schedule of the Indian constitution.
• S. No. 1 and 2 of the 12th Schedule of
the Constitution reads as under:
o Urban planning and
town planning;
o Regulation of land use
and construction of
buildings.

• From the RERA Act, 2016 it is
observed that RERA does not
perform the functions of urban
planning and town planning and thus
their activities do not fall in Sl. No. 1
of the 12th Schedule.
• As for regulation of land use under
Sl. No. 2 of 12th Schedule of the
Constitution, it involves dividing
land within a local jurisdiction into
districts, specifying which uses are
permitted or prohibited in each
district, and establishing standards to
govern each use. RERA does not
perform these functions of regulation
of land use. It also does not regulate
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the construction of buildings as well.
Regulation of construction of
building by local bodies involves
activities such as, approving building
plans, providing TDR/FSI, fire safety
norms, commercial/residential usage.
Etc.
• In view of the above, RERA cannot
be said to be performing any activity
in relation to any function entrusted
to a municipality under article 243 W
of the Constitution.
• Function of RERA is to protect the
interests of the buyers/investors and
bringing financial discipline in a real
estate project.
• Accordingly, the Fitment Committee
recommended to maintain status quo.
7. The State of Punjab
has sent a proposal
for levy of GST on
renting of
commercial property
on RCM basis

• Renting out an immovable
property is treated as a supply
of services. GST is applicable
on certain types of services
such as:
 When a property is given
out on lease, rent,
easement or licensed to
occupy;
 When any property is
leased out including a
commercial, industrial, or
residential property for
business.
• GST @18% is applicable on
the renting income. However,
vide notification no. 12/2017-
Central Tax (Rate) dated 28th
June 2017, services by way of
renting of residential dwelling
for use as a residence are
exempted from GST.
• The GST Council in its 47th
meeting had recommended
that renting of residential
• Currently, vide entry 12 of the
notification No. 12/2017 dated
28.06.2017, renting of residential
dwelling for use as residence is
exempt from GST except when it is
rented to a registered person, in
which case it is taxed under RCM.
• Services by way of renting of
immovable property (other renting of
residential dwelling to a registered
person for use as residence) is taxable
on forward charge basis (except
renting of immovable property by
Government and Local Authority to a
registered person).
• Taxing renting of commercial spaces
under RCM like renting of residential
dwelling is taxed, is not feasible. The
two are not comparable. In case of
renting of residential dwelling, GST
under RCM is required to be paid
only by a registered person.
However, if renting of commercial
property is taxed under RCM,
unregistered tenants will also have to
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property to a registered person
would be subject to GST on
reverse charge basis.
Accordingly, notification no.
05/2022- Central Tax (Rate)
dated 13th July 2022 has been
issued whereby service by
way of renting of residential
dwelling to a registered person
has been brought under
reverse charge and tax is to be
paid by the registered person
who is taking the said dwelling
on rent.
• This implies that even if the
rent of the said property is less
than Rs. 20 lakhs (threshold
for registration) it would be
subject to GST. Further, GST
is applicable @ 18% under
forward charge on renting of
commercial property.
• In case of renting of
commercial property, only
registered person is subject to
payment of tax. However,
where the person providing
service of renting of
commercial property is
unregistered (on account of
threshold for registration) no
GST is applicable.
• A number of instances have
been noticed by the field
formations where the rent or
lease deed of value less than
Rs 20 lakhs is being prepared
by the property owners in
order to avoid payment of
GST, though actual rent is
above the threshold value of
registration for services under
GST i.e. Rs 20 lakh per
annum.
pay tax under RCM and will have to
take registration for that purpose.
• It will also block ITC of the supplier.
• Moreover, it shall shift the
compliance burden from supplier of
commercial spaces (owners of
commercial building, malls, market
complexes, office buildings) to small
businesses- registered and
unregistered.
• The issue raised by the State of
Punjab appears to be more of an
enforcement. Issue.
• The solution proposed will shift
enforcement/ compliance concerns
from the supplier to the recipient side.
It will be difficult to monitor the
compliance by the large number of
unregistered recipients of
commercial spaces.
• Fitment Committee recommended no
change is required in the existing
provisions.


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• Further, one property or
commercial unit is registered
in the name of individual
family members so that rental
income is divided in them and
GST payment is avoided.
• In light of the above, it is
proposed that renting or
leasing of commercial
property to registered person
may be subject to tax on
reverse charge basis in order to
plug the leakage of revenue.
• Thus, it is proposed that where
the service by way of renting
of commercial property to a
registered person is provided
the same should be subject to
RCM. This would not only
plug the loopholes as detailed
earlier but also would bring
parity in the taxation of service
of renting of commercial or
residential property to
registered person.
• Since the availment of Input
Tax Credit on immovable
property or construction is
already barred by the
provisions of sub-section (5)
of section 17 of the GST Act,
there is not expected to be
much of ITC blocking for such
taxpayers as beyond the extant
regime.






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f) Issues deferred by the Fitment Committee for further examination in relation to services
Annexure-VI
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1. To clarify that
Flying
Training
Organizations
(FTOs)
approved by
DGCA are
educational
institutions
under GST
and
consequently
GST is not
applicable on
the courses
conducted by
them.


It has been submitted
by National Flying
Training Institute
Private Limited that
it is approved by
DGCA to conduct
flying training to
pilots. DGCA fully
controls such
training institutes by
prescribing syllabus,
number of seats per
session, conduct of
examination. It
issues a Course
Completion
Certificate and On
Job Training
certificate to
candidates. Course
completion
certificate is
approved by DGCA.
Thus, NFTI should
be considered as an
educational
institution and the
educational courses
and certificates
issued by it for
obtaining
commercial pilot
license should be
considered as
education
recognized under
law. Circular No.
117/36/2019-GST
dated 11.10.2019
clarified that
• Services supplied by educational institutions to
students are exempt from GST vide entry 66 of
the Notification No. 12/2017-CT(Rate), dated
28th June, 2017. “Educational Institution”
means an institution providing services by way
of:
i. Pre-school education and education up to
higher secondary school or equivalent,
ii. Education as a part of a curriculum for
obtaining a qualification recognized by any
law for the time being in force,
iii. Education as a part of an approved vocational
education course.
• Based on the recommendation of GST Council in
the 37th Meeting held on 20th September, 2019,
it has been clarified vide Circular No.
117/36/2019-GST dated 11.10.2019 that the
maritime training institutes are educational
institutions and the courses conducted by them
are exempt from levy of GST.
• Flying training institutes have also requested for
a similar clarification in respect of flying training
imparted by them.
• The matter was discussed by the Fitment
Committee and it was recommended that the
issue may be referred to the GoM on rate
rationalisation as decided in the 48th GST Council
meeting.
• May be deferred.
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Maritime Institutes
are educational
institutions under
GST Law and the
courses conducted
by them are exempt
from levy of GST.
2. Exemption of
GST payable
on premium
amount for
long-term
leases of 30
years and
above
executed by
Government
owned
Institutions/
Industrial
Development
Corporations/
Undertakings.
The Madhya Pradesh
Tourism
Development
Corporation
(MPTDC) _ grants
long term leases of
land for a period of
30 to 90 years to
investors willing to
invest in tourism
related projects in
the state. Such leases
are currently not
being considered
within the exemption
as the land in
question does not lie
within Industrial
areas and the
projects cannot be
strictly termed as
“Infrastructure
development
projects for
Financial Business‟.
Thus, it is proposed
that Entry No 41 of
the notification No.
12/2017- CT(R) be
amended as
follows:- “Upfront
amount( called as
Premium, Salami,
cost, price,
development
charges or by any
other name) In

• The matter is pending with GoM on Real Estate.
• It was deferred in 45th GST Council held on
17.09.2021

• The matter may be deferred.

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respect of service by
the way of granting
of long-term lease of
30 years or more of
plots for
development of
infrastructure for
industry and for
financial or other
business, provided
by the State
Government
Industrial
Development
Corporation or
Undertaking or by
any other entity
having 20% or more
ownership of Central
Government, State
Government, Union
Territory to the
industrial
units or the
developer.”
3. Exemption on
the
redevelopment
of buildings in
own co-
operative
housing
society on
ownership
basis in
Abhyuday
Nagar,
Mumbai
It has been decided
to re- develop
Abhyuday Nagar
Co-operative
Housing Societies
Ltd. having 48
buildings and to allot
occupants of these
buildings their own
houses on ownership
basis.
It is claimed that
there is no clarity on
the GST applicable
on the cost of the
new alternate
permanent
accommodation to
be provided to
• The matter is pending with GoM on Real Estate.
• It was deferred in 45th GST Council held on
17.09.2021

• The matter may be deferred.
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occupants. Earlier at
the time of VAT
such alternate
permanent
accommodation
were exempted from
VAT but due to GST
this process of
redevelopment is
getting delayed.
4. Proposal to
exempt the
supply of
construction
services
provided by
the Co-
operative
Housing
Society to its
members.
The Co-operative
Housing Societies
just reimburse the
expenses incurred
for procuring goods
and services for
construction
purpose. In some
cases, the Co-
operative Housing
Societies collect
advance payment
from members as per
agreed term and
conditions to meet
the expenses to be
incurred for
construction of
residential real estate
property for the
members.

So, ideally there is
no value addition
when a Co-operative
Housing Society is
subsequently
supplying of goods
and services to the
members.

But, the Co-
• The matter is pending with GoM on Real Estate.
• It was deferred in 45th GST Council held on
17.09.2021

• The matter may be deferred.

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operative Housing
Society is liable to
take registration
since; it is providing
taxable supplies to
members in relation
to construction of
residential real estate
property for the
members.
5. Services
provided by
Central
Government
or State
Government
or
Governmental
Authority by
way of
granting of
long term
lease
(exceeding 30
years) should
be exempted
from GST.
It was believed that
the services provided
by the Central State
Government or State
Government or
Local Authority or
Governmental
authority in form of
long term lease of
land of industrial
plots or plots for
development of
infrastructure for
financial business
are already exempt
in GST.

Entry No. 41 of
notification No.
12/2017 – Central
Tax (Rate) dt
28.06.2017 exempts
grant of long-term
lease of industrial
plots or plots for
development of
infrastructure for
financial business,
provided by the State
Government
Industrial
Development
Corporations or
• The matter was deferred in the 43rd GST Council
held on 28th May, 2021.
• The matter was examined in the Fitment
Committee and it was recommended that the
matter may be referred to the GoM on real estate
for examination, as it is closely related to the
issues already before the GoM.

• The matter may be deferred.





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Undertakings or by
any other entity
having 20 per cent.
or more ownership
of Central
Government, State
Government, Union
territory to the
industrial units or the
developers in any
industrial or
financial business
area.

Therefore, where the
ownership of
Government is
100%, no tax is
leviable.

However, recently
Gujarat Authority
for Advance Ruling
held that one time
long term lease
premium
payable/paid by the
Jinmangal
Corporation to
Ahmedabad Urban
Development
Authority is taxable
supply.

In this regard: (a) it
may be clarified that
tax shall not be
leviable on services
provided by the
Central State
Government or State
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Government or
Local Authority or
Governmental
authority in form of
long term lease of
land of industrial
plots or plots for
development of
infrastructure for
financial business; or
(b) the issue may be
deliberated afresh.
6. To clarify the
nature and
taxability of
various
supplies in
relation to
crypto eco-
system.
• The GST Council, in its 47th meeting held on 28-
29 June 2022 and in its 48th meeting held on 17
December 2022, has deferred the issues
regarding the nature and taxability, of various
supplies in relation to the crypto eco-system.
• It was felt that the issues involved in crypto
ecosystem need deeper study. It was decided that
Haryana and Karnataka shall study all aspects
and submit a paper before the Fitment
Committee in due course. Both Haryana and
Karnataka expressed their inability to submit the
paper.
• The matter was deliberated in the Fitment
Committee. It was agreed that TRU may study
the issue and submit a paper.
• The matter may be deferred.
7.

Harmonisation
of GST Rate
Schedule on
Services and
the
Classification
of
Services
adopted for
GST


• In GST, a Scheme of Classification of services
has been adopted. This classification of services
is a modified version of UNCPC (UN Central
Product Classification of Goods and Services).
While UNCPC has a 5-digit classification, the
classification adopted for GST is a 4-digit
classification with digits 99 pre-fixed to indicate
that these are services.
• As per Notification No. 12/2017-Central Tax
dated 28.06.2017, as amended by Notification
No. 78/2020-Central Tax dated 15.10.2020,
taxpayers having turnover up to Rs. 5 Crore in the
previous financial year are required to declare
classification of services at a 4-digit level and
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those having turnover above Rs. 5 Crore at a 6-
digit level.
• However, currently the GST rate schedule for
services does not mention the classification of
services at the 6-digit level.
• The GST rate schedule follows classification of
services only up to 4-digit level. Further sub-
categorization of services in the GST rate
schedule is at complete divergence with the
Classification of Services adapted for GST.
• In the GST rate schedule, sub-categorization of
services beyond the 4-digit level has been carried
out only for those services, on which a rate lower
or higher than the standard rate of 18% was to be
prescribed. This sub-categorization in the rate
schedule has been done on the basis of the
description of such services, without mentioning
the 6 digit-level classification, and such sub-
categories have been numbered as (i), (ii), (iii)
and so on under each 4-digit heading. Therefore,
in effect, the GST rate schedule operates at a 2
digit-level of classification (the first two digits,
namely ‘99’ (only denoting that it is a service)
rendering impossible any meaningful analysis of
revenue foregone, ITC availment etc.
• The taxpayers are required to declare in the
invoice/GST returns not the Sl. No. of GST Rate
Schedule under which they have paid GST but the
6-digit classification of services in the Scheme of
Classification annexed to the Rate Schedule. As
a result, data of services for which a concessional
rate of 5% or 12% or a higher rate of 28% has
been notified is not captured.
• A revised rate schedule of services which is a
synthesis of the current rate schedule with the
classification of services has been prepared with
a view to promote ease of doing business and to
ensure better collection of data.
• This data – the value of services, GST collected,
GST paid in cash and through credit – which is
very important for policy formulation - for
assessing revenue forgone, the potential impact
on revenue of any change in GST rate, extent of
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inversion and credit accumulation etc. is
currently not available to the tax authorities.
• Fitment Committee recommended that the draft
revised rate schedule of services at 6-digit level
of classification may be circulated to all states for
comments, after which the same may be
examined by Fitment Committee/sub-committee
of Fitment Committee in light of
suggestions/feedback received from the States.
• The same shall then be placed before the GST
Council for approval. Once approved, it shall be
placed in the public domain and implemented
after incorporating any changes required therein
in view of the feedback received and after a drop-
down mechanism for selecting 6-digit
classification of services is made available in
GSTN portal.
• May be deferred.

8. Request to
clarify
whether GST
is applicable
on charges/
fees like FSI
paid by
builders to
local
authorities
under RCM.




• In construction
industry, all
builders &
developers pay
various charges
to local
municipal
authorities in the
form of FSI
premium, road
permission
charges, scrutiny
fees, liasoning
fees, staircase
premium, water
charges,
sewerage
charges etc.
• Some of the
taxpayers have
contended that
the said services
are exempt
• Municipalities collect various charges such
as FSI premium, road permission charges,
scrutiny fees, liasioning fees, staircase
premium, lift NOC charges, fire NOC
charges, sewerage charges, charges for
change of land use etc for different services
supplied to builders/developers.
• FSI premium is the consideration paid by
builders for obtaining additional FSI over and
above the base FSI from the Local Authorities.
• Base FSI is the basic FSI permitted by the
competent authority as a matter of right without
any cost.
• Additional/ chargeable/premium FSI is the FSI
that can be obtained by making additional
payment to the competent authority as per the
applicable rules.
• Maximum permissible FSI is the FSI that
includes the base and chargeable FSI.[ Max
Permissible FSI= Base FSI+
Chargeable/Premium FSI]
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under
notification
12/2017-CT(R)
dated
28.06.2017.
• Floor Space
Index (FSI) is
defined as the
maximum
permitted floor
area that a
developer can
build or
construct on any
given plot or
piece of land
area. In other
words, it is a
measure of the
intensity of land
utilization in a
given area.
• As per the
information
received,
Rajkot
Municipal
Corporation
has granted FSI
of Rs. 543.24
Cr since
inception of the
GST Act. In a
small city like
Rajkot, local
municipal
corporation has
collected a
handsome
amount
towards grant
of FSI within
span of just six
years. In the big
metro city like
• During the discussions held on the issue in the
Fitment Committee, it was felt that the issue
needs more detailed examination.
• The Fitment Committee recommended that the
matter may be deferred.
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Ahmedabad,
Surat and
Baroda,
handsome
amount is being
collected
towards grant
of FSI.

View of Promoter
- Transactions
may be considered
as neither a supply
of goods nor a
supply of service:

• As per the
Notification No.
14/2017-Central
Tax (Rate),
activities or
transactions
undertaken by
any local
authority by way
of any activity in
relation to a
function
entrusted to a
Municipality
under article
243W of the
Constitution
shall be treated
neither as a
supply of goods
nor a supply of
service.
• As per Article
243W, certain
responsibilities
are conferred
upon them
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including those
listed in the
XIIth Schedule.
Sr. No. 1 & 2 of
Schedule XII of
the Constitution
of India deal
with "Urban
planning
including town
planning" and
"Planning of
land-use and
construction of
buildings”
respectively.
These functions
are entrusted to
Municipality
under Article
243W of the
Constitution.
• As per the
representation
sale or grant of
FSI against
collection of
fees is also part
of the said two
functions only.
Therefor GST is
not payable on
supply of FSI by
municipal
corporation to
the registered
person.

Views of Tax
authority:
• Supply of FSI
against
collection of
fees is not
integral part of
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"town planning".
Transaction of
supply of FSI by
the RMC to the
taxpayer is
merely a
commercial
activity.
Performance or
non-
performance of
"town planning
work" has no
nexus with
activity per se
the supply of
FSI, which is
entirely
independent to
each other.
Supply of FSI to
the business
entity serves the
only purpose of
generating
revenue for local
authority.
• In the
Notification No.
14/2017 ST
(Rate), the
phrase "Services
by way of any
activity in
relation to a
function
entrusted to a
Municipality
under article
243W of the
Constitution”
does not mean
"Commercial
activities under
consideration".
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Thus, the said
activity in form
of the supply of
FSI against
charging fees by
RMC being an
independent
taxable supply
of services,
would not be
qualified for and
could not be
treated as "No
Supply of
Services".
• Further, as per
entry-16 (iii) in
Notification No.
11/2017 state tax
(rate) read with
entry-5 in
Notification No.
13/2017 state tax
(rate), tax under
RCM is payable
by the taxpayer
as recipient of
services.


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Appendix-I

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Appendix-II

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Appendix-III



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Appendix-IV
Recommendations of Fitment Committee on positive list of services to be specified in Sr. No. 3/3A
of Notification No. 12/2017-CT(R)) dated 28.06.2017
The entries at Sr. No. 3 and 3A of exemption Notification No. 12/2017-CT(R) dated 28.06.2017
exempt supply of pure services and composite supplies (goods component 25% or less) supplied to
Central Government, State Government or Local Authority, by way of any activity in relation to
Municipal or Panchayat functions under Article 243G or 243W of the Constitution
2. With effect from 1.1.2022, the entries read as below:
Entry 3 of Notification No. 12/2017- CT(R):
“Pure services (excluding works contract service or other composite supplies involving supply of any
goods) provided to the Central Government, State Government or Union Territory or local authority
by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the
Constitution or in relation to any function entrusted to a Municipality under Article 243W of the
Constitution.”
Entry 3A of Notification No. 12/2017- CT(R):
“Composite supply of goods and services in which the value of supply of goods constitutes not more
than 25 per cent. of the value of the said composite supply provided to the Central Government, State
Government or Union territory or local authority by way of any activity in relation to any function
entrusted to a Panchayat under Article 243G of the Constitution or in relation to any function entrusted
to a Municipality under Article 243W of the Constitution.”
3. Prior to 1.1.2022, the exemption entries covered services supplied to Governmental authority
and Governmental entities also.
4. There was a similar exemption in Service Tax initially. However, in view of disputes of
interpretation and misuse, the exemption was restricted to supply of services by way of five specific
activities, namely, water supply, public health, sanitation conservancy, solid waste management or slum
improvement and up-gradation.
5. In view of the concern that the exemption is being interpreted too widely, a proposal to specify
a positive list of services under the said entries was placed before the 45th GST Council meeting. The
Council was of the view that while the approach to specify a positive list of exempt services was
agreeable, the list recommended by Fitment Committee needs to be pruned and refined. It was agreed
that the list of services shall be circulated to all states for their inputs for refining the list which may be
brought before GST Council for approval.
6. Accordingly, as per the direction of the Council, the List was circulated to States. Comments
were received from West Bengal, Bihar and Tamil Nadu. The issue was discussed at length in the
Fitment Committee. After long deliberation the Fitment Committee was of the view that the exemption
under said entries should confine to those services which are directly connected with the functions
entrusted to Panchayat or Municipality and not services remotely or vaguely connected with those
functions. Further, it was felt that only few services constitute bulk of input services by the local
authority. Hence the list could be pruned down significantly while ensuring that major services by these
bodies remain exempted. This approach would ensure that exemption entries are not interpreted widely,
local authority continue to have major relief on supply of input services, and in respect of other general
services the normal design of GST could be applied. Fitment Committee also felt that in respect of
Agenda for 52nd GSTCM Volume 1
Page 384 of 389
purchase of goods no special concession is allowed to procurement by the Government or Local
Authority. They suffer same incidence on goods as any private person (for example cement, iron and
steel, vehicle, furniture etc.). In service, the special concession crept in as services were taxed differently
in pre-GST regime wherein tax was only imposed by Centre and there was no VAT on services.
However, In GST there should not be any appreciable difference in the approach for goods and services.
As is the case in goods, the Government and Local Authority should also bear the normal rate of GST
on input services barring exceptions. Accordingly, Fitment Committee carved out a positive list of
services for consideration of the Council. The list contained the following 6 services :
1) Water treatment and/or supply
2) Public Health activities, Sanitation Conservancy and Solid or Liquid Waste management
3) Slum Improvement and Up gradation
4) Maintenance and operation of street lights, bus stops, public conveniences, public parks and
gardens, burial ground and crematorium.
5) Renting of motor vehicles for carrying out functions listed at Sr. No. 1 to 4 above.
6) Supply of manpower services for carrying out functions listed at Sr. No 1 to 4 above.
7. With this positive List approach, it was also felt that the authorities constituted in different
states for such civic work as fall in the proposed positive list should also be included in the ambit of
these exemptions alongside the local authority. Accordingly , the exemption may also be extended to
specified services supplied to Public Authorities which may be defined as under:
“Public Authority” means an authority or a board or any other body established by the Government
to carry out the functions listed in S. No. 1 to 4 of the entry.
8. The recommendation of the Fitment Committee was discussed in the 47th GST Council meeting
held on 28th -29th June, 2022. Since, some of the states expressed their concerns that the positive list of
services should be more broad based, the Council directed that the proposal to specify a positive list of
services under Sr. No. 3 & 3A of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 may
be reconsidered by the Fitment Committee taking into account the inputs from all the States which had
voiced their concerns in the said council meeting.
9. Accordingly, the States of Telangana, Andhra Pradesh and Delhi were invited to the Fitment
Committee meeting held on 12.09.2022 to give their views on the said issue. At the said meeting,
Telangana requested to include Public Distribution System, Animal Husbandry etc. under the proposed
positive list. Andhra Pradesh suggested expanding the proposed definition of Public Authority so as to
cover manpower supply services hired by the state through a state corporation under exemption.
10. The views given by the states in writing were as under:
Telangana :
The following services may be added to the list of services to be specified in entry 3/3A of Notification
No. 12/2017-Central Tax (Rate) dated 28.06.2017:
• Public Distribution and the related activities including Custom Milling and transportation
services
Agenda for 52nd GSTCM Volume 1
Page 385 of 389
Process of public distribution system involves large scale procurement of Custom Milling
Services and renting of vehicles transportation services, without which the final goal of
distribution cannot be met.
• Minor Irrigation
Telangana has taken up the programme of restoring the minor irrigation sources under the title
“Mission Kakatiya”. The services procured under this programme areprimarily in the nature of
pure services or services where goods component is less than 25%.
• Social forestry and Farm forestry
For achieving the objective of increasing tree cover in the State to 33% of the total geographical
area of the State through the "Haritha haram".
• Roads and bridges
To improve the connectivity, earth work (laying of mud roads) is taken up on a continuous basis
in many villages. These services are generally procured from the Local people and the
involvement of the goods component in these services is quite low.
Delhi
The exemption on services mentioned in Article 243 G & 243 W of Constitution of India should be
continued.
11. In view of the above suggestions received from states, the Fitment Committee went through the
list of activities specified in the 11th and 12th Schedule to the Constitution and recommended that the
following services may be added to the positive list of services (placed before the 47th GST Council)
under Sr. No. 3/3A of Notification No. 12/2017-CTR
• Education, including primary and secondary schools
• Technical training and vocational education
• Adult and non-formal education
• Libraries
• Social Forestry and Farm Forestry
• Fire Services
11.1 On the suggestion to include ‘society’ also in the definition of Public Authority, consensus was
that the phrase ‘any other body’ used in the definition of Public Authority proposed in the 47th GST
Council Meeting would include societies, companies, corporations etc. also.
11.2 As regards, the suggestion of Telangana to include Minor Irrigation & Roads and Bridges. GST
on specified works contract services (WCS) supplied to Central Government, State Government and
Local Authorities has recently been revised from 12% to 18% with effect from 18.07.2022 and on WCS
predominantly involving earthwork from 5% to 12%. Services procured for minor irrigation and for
construction/laying down of roads & bridges would predominantly be WCS which the GST Council
has recommended to be taxed at 18%/12%.
11.3 Exempting custom milling will block the input tax credit (ITC) of the milling units on capital
goods, raw materials (such as packing material, vitamins and other fortification additives etc.) and input
services. GST payable on customs milling will in any case flow back to the Government as revenue.
Agenda for 52nd GSTCM Volume 1
Page 386 of 389
12 Accordingly, after reconsidering the issue , the Fitment Committee recommended that (a) the
following expanded list of 12 services may be specified in SI. No. 3 and 3A of Notification No. 12/2017-
CTR as under:
“3. Supply of pure services, or composite supply of goods and services, in which the value of goods
constitutes not more than 25% of the value of composite supply, to Central Government, State
Government, Union Territory, a local authority or a public authority by way of,
1. Water treatment and/or supply;
2. Public Health activities, Sanitation Conservancy and Solid or Liquid Waste management;
3. Slum Improvement and Up gradation;
4. Maintenance and operation of street lights, bus stops, public conveniences,
public parks and gardens, burial ground and crematorium;
5. Education, including primary and secondary schools;
6. Technical training and vocational education;
7. Adult and non-formal education;
8. Libraries;
9. Social Forestry and Farm Forestry;
10. Fire Services;
11. Renting of motor vehicles for carrying out functions listed at Sr. No. 1 to 10 above;
12. Supply of manpower services for carrying out functions listed at Sr. No 1 to 10 above.”

(b)Public authority may be defined as under:
“Public Authority means an authority or a board or any other body established and controlled by the
Central or State Government to carry out the functions listed in SI. No. 1 to 10 of the entry.”
(c) As a consequential change to the proposed modification in entry 3 and 3A of the said Notification,
an explanation may be inserted in the modified entry along the lines of the Circular No.177/09/2022-
TRU dated 03rd August 2022 as under:
“Explanation: The exemption under this entry applies only to pure services and composite supplies
procured by Central Government, State Government, Union Territories, local authorities or a public
authority for performing functions listed in the 11th and 12th Schedule of the Constitution. Services
procured by any Central/State Government Ministry/Department /Union Territory or Public Authority
which does not perform any functions listed in the 11th and 12th Schedule, in the manner as a local
authority does for the general public, are not eligible for exemption under this entry.”
13. The above recommendation of the Fitment Committee was discussed in the 48th GST Council
meeting held via video conference . Some of the states including Tamil Nadur, Delhi, Kerala, Andhra
Pradesh and west Bengal did not agree with the recommendation of the Fitment Committee. The
Council decided to postpone discussion on the positive list of services in a physical meeting of the GST
Council.
14. The recommendation of the Fitment Committee as contained in paragraph 12 was discussed in
the 50th GST Council meeting held on 11.07.2023. Punjab sought some more time to study the list
comprehensively and requested the Chair to defer the agenda item to be taken up in the next Council
Meeting. It was suggested by Karnataka that the exemption entries at 3 and 3A of notification No.
12/2017-CT (R) should continue to cover all the activities specified in the 11th and 12th Schedule of the
Constitution and that the words “in relation to” appearing in entry 3 and 3A of Notification No. 12/2017-
Agenda for 52nd GSTCM Volume 1
Page 387 of 389
CT (R) may be substituted by the words “by way of” to remove difficulties caused by wide interpretation
of the phrase “in relation to”. Considering the views of the states of Punjab and Bihar, the Chairperson
proposed to defer the agenda item. It was decided that it would be brought before the Council for a
decision in the next meeting of the Council.

Agenda for 52nd GSTCM Volume 1
Page 388 of 389
Agenda Item 5: Performance Report of Competition Commission of India (CCI) along with
Performance Reports of State Level Screening Committee (SLSC), Standing Committee (SC) and
Directorate General of Anti-Profiteering (DGAP) for 1st quarter of the F.Y 2023-24.

The performance report of Anti-profiteering authorities at various levels are as under:
1.1. Performance of Competition Commission of India (CCI):
Opening
Balance
No. of
Investigation
Reports
received
from DGAP
Disposal of Cases Closing
Balance Total
Disposal
No. of
cases
Where
Profiteering
established
No. of
cases
Where
Profiteering
not
established
No. of
cases
referred
back to
DGAP
1st Quarter -April 2023 to June 2023
170 6 0 0 0 0 176

1.2 Performance Report of DG of Anti-Profiteering (DGAP):
Opening
Balance
(No. of cases)
Receipt Disposal Mode of disposal of cases Closing Balance
(No. of cases) Report to CCI
confirming
profiteering
Report to CCI
for closure
action
1st Quarter -April 2023 to June 2023
39* 2 6 6 0 35

* Opening Balance shall differ with the closing balance of previous quarter by 3 as these 3 cases were
already concluded by DGAP however Hon’ble High Court granted stay on other products/projects.
• Out of these 35 cases, 31 cases have been stayed by various Hon’ble High Courts.
• One case has been held up as per direction by NAA/CCI.
• Actual pendency of cases in which investigation is under process are 3 only.

1.3 Performance Report of the Standing Committee (SC) on Anti-profiteering:
Opening Balance
(No. of cases)
Receipt Disposal Closing Balance
(No. of cases)
1st Quarter - April 2023 to June 2023
33 11 0 44






Agenda for 52nd GSTCM Volume 1
Page 389 of 389
1.4 Performance Report from the State Level Screening Committee (SLSC):
Opening
Balance
(No. of
cases)
Receipt Disposal Closing Balance
(No. of cases) Cases referred to
Standing Committee
Cases Rejected
1st Quarter - April 2023 to June 2023
303** 85 3 291 94

** Since report from the Tamil Nadu State Screening has not been received and report of Andhra
Pradesh and Punjab State Level Screening Committee was not received at the material time during
the last quarter. Hence closing balance of Quarter ending March 2023 and Opening Balance of
Quarter ending June 2023 may differ by 5.

2. During these quarters CCI has undertaken the following activities/initiatives-
i. A meeting of the Commission was held on 22.06.2023 wherein 12 cases were taken up and
necessary directions were given by the Commission. Thereafter, the matters are regularly being
taken up by the Commission.
ii. For the quarter ending on 30.06.2023, out of 27 complaints, 12 complaints relating to
profiteering in terms of Section 171 of the CGST Act, 2017 were forwarded to the respective
Screening Committees/ Standing Committee for further action/examination and 15 complaints
which were related to other GST/Enforcement issues were forwarded to the Jurisdictional State
& Central GST Commissioners/ Chief Commissioners for necessary action.
3. Accordingly, the Performance Report of Competition Commission of India (CCI) along with
Performance Reports of SLSC, SC and DGAP on Anti-Profiteering for 1st quarter of the F.Y 2023-24
are placed before the GST Council for information.
*****




Agenda for 52nd GSTCM Volume 1
Page 1 of 34
Confidential
Agenda for
52nd GST Council Meeting
07th October, 2023
Volume-II
Agenda for 52nd GSTCM Volume 2
Page 2 of 34







Agenda for 52nd GSTCM Volume 2
Page 3 of 34
GST Council Secretariat New Delhi
5th Floor, Tower-II, Jeevan Bharti Building, New Delhi
25th September, 2023

OFFICE MEMORANDUM
Subject: Notice for the 52nd Meeting of the GST Council scheduled to be held on 7th
October, 2023.

The undersigned is directed to refer to the subject stated above and to convey that the 52nd
Meeting of the GST Council will be held on 7th October, 2023 at Delhi. The schedule of the
Meeting is as follows:
• Saturday, 7th October, 2023 : 10:00 A.M. onwards
2. In addition, an Officers' Meeting will be held on 6th October, 2023 at
NDMC Convention Centre, Sansad Marg, New Delhi as per the following schedule:
• Friday, 6th October, 2023 : 02:30 P.M. onwards
3. The agenda items and other details for the 52nd Meeting of the GST Council will be
communicated in due course of time.

4. Kindly convey the invitation to the Hon’ble Member of the GST Council to attend the 52nd
Meeting of the GST Council.

Sd/-
(Sanjay Malhotra)
Secretary to the Govt. of India and ex-officio Secretary to the GST Council
Tel: 011 23092653

Copy to:
1. PS to the Hon’ble Minister of Finance, Government of India, North Block, New Delhi with
the request to brief Hon’ble Minister about the above said meeting.
2. PS to the Hon’ble Minister of State (Finance), Government of India, North Block, New
Delhi with the request to brief Hon’ble Minister about the above said meeting.
3. The Chief Secretaries of all the State Governments, Union Territories of Delhi, Puducherry
and Jammu and Kashmir with the request to intimate the Minister in charge of
Finance/Taxation or any other Minister nominated by the State Government as a Member of
the GST Council about the above said meeting.
4. Chairman, CBIC, North Block, New Delhi, as a permanent invitee to the proceeding of the
Council.
5. CEO, GST Network
Agenda for 52nd GSTCM Volume 2
Page 4 of 34

Agenda for 52nd GSTCM Volume 2
Page 5 of 34
TABLE OF CONTENTS




Sl. No. Agenda Item Page No.
Errata- for Agenda Item 3(vi): Clarification on various issues related to
Place of Supply
7-7
4.
(Part-II)
Recommendations of the Fitment Committee for the consideration of the GST
Council

(i) Agenda on Extra-Neutral Alcohol (ENA) 8-9
(ii) Issues deferred by the Fitment Committee for further examination in
and clarification for issues where no change has been proposed by
the Fitment Committee in relation to services
10-19
6. Ad-hoc Exemptions Order(s) issued under Section 25(2) of Customs Act, 1962
to be placed before the GST Council for information
20-26
7. Review of revenue position under Goods and Services Tax. 27-34
8. Any other agenda with the permission of the Chair
Agenda for 52nd GSTCM Volume 2
Page 6 of 34

Agenda for 52nd GSTCM Volume 2
Page 7 of 34
Discussion on Agenda Items


Errata
Agenda Item 3(vi): Clarification on various issues related to Place of Supply.
1) On Page 276 Agenda Item 3(vi) of Volume-I of the agenda for 52nd GST Council Meeting heading
“B. Clarification regarding place of supply for services in respect of advertising sector” may
be read as “C. Place of supply in case of supply of the “co-location services”


Agenda for 52nd GSTCM Volume 2
Page 8 of 34
Agenda Item 4(Part-II): Recommendations of the Fitment Committee for the consideration of
the GST Council
Agenda Item 4(Part-II)(i): Agenda on Extra-Neutral Alcohol (ENA)

ENA (Extra Neutral Alcohol), also known as rectified spirit or rectified alcohol, is a high distillate
alcohol, free from impurities, typically containing 95% alcohol by volume.
The GST Council, in its 20th meeting held on 5.8.2017, while deliberating upon the matter regarding
the taxation of rectified spirit/ ENA under GST, recommended the following:
a) For the time being status quo should be maintained regarding taxation of ENA for manufacture
of alcoholic liquor for human consumption, i.e. Extra Neutral Alcohol supplied for industrial
purpose shall attract GST at the rate of 18%.
b) Opinion of the Attorney General of India may be sought regarding legality of the levy of GST
on supply of ENA for manufacture of alcoholic liquor for human consumption.
c) Representatives of States who wish to participate in briefing to the Ld. AG may also be invited
for such briefing.
Accordingly, the matter regarding levy of GST on supply of ENA for manufacture of alcoholic liquor
for human consumption within the prevailing constitutional provisions was referred to Ld. Attorney
General who opined that the judgment of the Hon’ble Supreme Court in Bihar Distillery does not
denude the Centre or the States of the power to levy GST on ENA that is used to manufacture alcoholic
liquor for human consumption.
The opinion of Ld. AG was circulated to states and placed as an agenda item before the GST Council
in its 26th meeting that was held on 10.3.2018. However, the agenda could not be taken up due to paucity
of time. In its 31st meeting held on 22.12.2018, the GST Council agreed to maintain status quo. Further,
in its 36th meeting held on 27.7.2019, the GST Council recommended that status quo may be maintained
and that states may go by the decision of Council decision as recorded in minutes of the 20th Council
meeting. Following this, in the 43rd GST Council meeting held on 28.5.2021, no conclusion could be
reached and the agenda was deferred.
Currently, there are varying practices across states with some distilleries discharging GST on ENA and
not paying VAT while some distilleries are paying VAT on ENA and not paying GST. There are also
some distilleries paying GST @ 18% on ENA cleared for manufacture of ‘liquor for human
consumption', but not paying any GST on Grain Neutral Spirits (GNS) when supplying to an alcohol
bottling unit. In addition, there are multiple litigations pending in various judicial forums. It is
imperative to take a decision since litigation is a time-consuming process and certainty must be provided
to the industry for ease of doing business.
Currently ENA for industrial use is being taxed at the rate of 18% under residual entry. However, a
dedicated tariff line “2207 10 12 – Spirits for industrial use” has been created vide Gazette Notification
dated 30th September 2023.
As per 20th GST Council decision, GST rate of 18% will be notified on ENA for industrial (HS
22071012).
It is therefore proposed to seek approval of the GST Council for the following:
a) To place before Hon’ble Supreme Court that the GST Council has no intent to subject ENA for
use in manufacture of alcoholic liquors for human consumption.
Agenda for 52nd GSTCM Volume 2
Page 9 of 34
b) In the interim, to exempt ENA (both Grain-based & Molasses-based ENA) from GST when
supplied for manufacture of alcoholic liquors. (States will also exempt ENA -both Grain-based
& Molasses-based ENA from VAT when supplied for industrial purposes).
c) To reduce GST on Molasses from 28% to 5%.
****

Agenda for 52nd GSTCM Volume 2
Page 10 of 34

Agenda Item 4(Part-II)(ii): Issues deferred by the Fitment Committee for further examination in
relation to services and clarification for issues where no change has been proposed by the Fitment
Committee in relation to services.
Sl.
No.
Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
1 To declare Delhi
Development Authority as
a Local Authority for the
purposes of GST.
• As per section 2(1)(d) of
National Capital Territory of
Delhi Laws (Special
Provisions) Act, 2011, DDA
is “a local authority”
established under the Delhi
Development Act 1957.
• Section 3(31) of General
Clauses Act 1897 defines a
local authority as “local
authority” shall mean a
municipal committee, district
board, body of port
commissioners or other
authority legally entitled to or
entrusted by the Government
with the control or
management of a municipal
or local fund.
• Supreme Court in the R.C
Jain case (1981 AIR
951) has held DDA to be a
Local Authority
• DDA has claimed status of a
Local Authority on the basis of
NCT Act 2011 which declares
DDA as a local authority and a
SC judgment passed in 1981 in
the context of liability of DDA to
pay bonus to employees.
• The issue was deliberated in the
Fitment Committee and it was
felt that the matter requires
detailed examination.
• Hence it may be deferred.

2 (i) To clarify whether
service by way of
hostel
accommodation,
service apartments
/hotels booked for
longer period is a
service of renting of
residential dwelling
for use as residence
and exempted as per
entry no. 12 of the
notification No.
12/2017-CT (Rate)
dated 28/06/2017.
• The accommodation
services under heading 9963
by a hotel, inn, guest house,
club or campsite by
whatever name called,
having declared tariff of a
unit below one thousand
rupees per day or equivalent
were exempt till 17.07.2022
vide entry no. 14 of the
notification No. 12/2017-
CT(R) dated 28.06.2017.
• Vide the latest amendment
notification No. 04/2022-
CT(Rate) dated 13.07.2022,
• There is no GST on hostel fee
or rent collected by
educational institutions
whether private or
Government including
schools, colleges, and
universities, from students
living in their hostels. (Sl. No.
66 of notification No.
12/2017 - CTR).
• Hostels run privately which
do not belong to any
educational institutions have
to pay GST as applicable.
Agenda for 52nd GSTCM Volume 2
Page 11 of 34
Sl.
No.
Proposal Details of Request Discussions in Fitment
Committee and its
recommendations

(ii) Request for GST
exemption on hostels
for poor and middle-
class students run by
charitable trusts.
the exemption to
hotel accommodation
having per day charges
below Rs. 1000/- has been
withdrawn w.e.f.
18/07/2022 and the said
supply is now made taxable
at 12% by the notification
No. 03/2022-CT (Rate)
dated 13.07.2022.
Currently, hotel
accommodation having
value of supply less than or
equal to Rs. 7500 per unit
per day attracts 12%
whereas those having value
of supply more than Rs
7500 per unit per day attracts
18%.
• Circular No.
354/17/2018-TRU dated
12.02.2018 at its point no.
1 has considered the hostel
accommodation at par
with the hotel
accommodation. The said
clarification reads as
below:
Hostel
accommodation
services do not fall
within the ambit of
charitable activities as
defined in para 2(r) of
notification No.
12/2017-CT(Rate).
However, services by a
hotel, inn, guest house,
club or campsite, by
whatever name called,
for residential or
lodging purposes,
having declared tariff
They are exempt upto
threshold turnover of Rs. 20
lakh. Earlier, hotel
accommodation having tariff
of Rs. 1000 per day or less
was exempt from GST.
Private hostels charging Rs.
30000 or less per month were
taking benefit of this
exemption.

• This exemption in respect of
hotel accommodation having
tariff of Rs. 1000 or less per
day has been withdrawn with
effect from July, 2022 based
on the recommendations of
GoM on rate rationalization.
(47th GST Council meeting).
Now private hostels are
claiming exemption
applicable to renting of
residential dwelling for use as
residence. (Sl. No. 12 of
notification No. 12/2017 -
CTR).

• The judgment of the Hon’ble
Karnataka High Court dated
03.02.2022 in the case of
Taghar Vasudeva Ambrish
that residential dwelling
includes hostels has been
appealed against by the
department and the matter is
pending before Hon’ble
Supreme Court of India.

• Since the case of Taghar
Vasudeva Ambrish is pending
before the Hon’ble Supreme
Court, the same was deferred
by the 50th GST Council held
Agenda for 52nd GSTCM Volume 2
Page 12 of 34
Sl.
No.
Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
of a unit of
accommodation below
one thousand rupees
per day or equivalent
are exempt. Thus,
accommodation
service in hostels
including by Trusts
having declared tariff
below one thousand
rupees per day is
exempt. [Sl. No. 14 of
notification No.
12/2017-CT(Rate)
refers]
• However, in the case of
Taghar Vasudeva Ambrish,
in WP No. 14891 of 2020,
the Hon’ble Karnataka
High Court at para 12 of the
judgment, while
reproducing the meaning of
‘residential dwelling’ has
observed that “in normal
trade parlance residential
dwelling means any
residential accommodation
and is different from hotel,
motel, inn, guest house, etc.
which is meant for
temporary stay.” In para
13, the court has noted that
“in hostels, the duration of
stay is more as compared to
hotel.” And later in para 14,
it came to conclusion that
“it cannot be held that the
residential dwelling does
not include hostel which is
used for residential
purposes by students or
working women.” Thus, the
court has held the service
of hostel accommodation
on 11.07.2023.
• In light of the fresh multiple
representations on the issue,
the matter was again
discussed in the Fitment
Committee meeting.

• As per Annexure to
notification No. 11/2017-
CTR dated 28.06.2017,
accommodation services
provided by Hotels, Inn,
Guest houses, Clubs & the
like are classified under SAC
9963. Other accommodation
services such as student
residences, hostels, Camps,
Paying Guest and the like are
also classified under the same
heading. The said entries
reads as below:

“Group 99631 Accommodation
services
996311 - Room or unit
accommodation services
provided by Hotels, Inn, Guest
House, Club and the like
996312 - Camp site services
996313 - Recreational and
vacation camp services.

Group 99632 Other
accommodation services
996321 - Room or unit
accommodation services for
students in student residences
996322 - Room or unit
accommodation services
provided by Hostels, Camps,
Paying Guest and the like
996329 - Other room or unit
Agenda for 52nd GSTCM Volume 2
Page 13 of 34
Sl.
No.
Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
as the services by way of
renting of residential
dwelling for use as
residence.
• Entry no. 12 of
notification No. 12/2017-
CT (Rate) dated
28.06.2017 exempts the
services by way of renting
of residential dwelling for
use as residence.
Therefore, if the hostel
accommodation is
considered as the hotel
accommodation, in line
with the circular dated
12.02.2018 issued by
CBIC, it is taxable service
and if it is considered as
residential dwelling, as
held by the Hon’ble
Karnataka High Court, it
is an exempt service. If the
ratio of ‘temporary stay’
applied by Hon’ble
Karnataka High Court, is
considered then it may
initiate some more legal
disputes in case of taxation
on Service apartments,
which were usually
booked by the companies
for a considerably longer
period.
• Further, services provided
by an education institution
to its students, faculty and
staff are already exempt
from payment of GST
vide Sr. No.66 of the
notification No. 12/2017-
CTR. Hence, hostel
accommodation services
nowhere else classified”

• Further, heading 9972
includes real estate services
involving owned or leased
property. It includes rental or
leasing services involving
own or leased residential
property that are primarily
residential and excludes
accommodation services
provided by operating hotels,
motels, rooming houses,
school dormitories, camp
sites and other lodging places.
The said entries in Annexure
to notification No. 11/2017 -
CTR reads as below:
“Heading 9972 - Real estate
services
Group 99721 - Real estate services
involving owned or leased
property
997211 - Rental or leasing services
involving own or leased residential
property”
• Further, in the Explanatory
notes to the Scheme of
Classification of Services,
it clearly mentions that the
service code 997211 does
not include
accommodation service
such as school dorms etc.
The relevant extract is
placed below:

“997211 Rental or leasing services
involving own or leased residential
property This service code includes
rental or leasing services
Agenda for 52nd GSTCM Volume 2
Page 14 of 34
Sl.
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Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
facilities wherever
provided by an
educational institution to
its students, faculty and
staff are covered under
this exemption.

concerning residential properties
by owners or lease holders houses,
flats, apartment buildings,
multipleuse buildings that are
primarily residential, residential
mobile home sites.

This service code does not
include: - accommodation
services provided by operating
hotels, motels, rooming houses,
school dormitories, camp sites and
other lodging places, cf.99631”

• Service by way of hostel
accommodation, service
apartments/ hotels are not
classified under heading 9972
and thus, it is not a service of
renting of residential dwelling
for use as residence which is
exempted as per entry no. 12
of the notification No.
12/2017-CT (Rate) dated
28/06/2017.

• As regards requests received
from charitable trusts running
hostels for poor and middle
class students, there is no
exemption for hostels run by
charitable trusts or religious
institutions at present.
However, renting of rooms
having charges less than Rs
1000/- per day, in religious
precincts by a registered
charitable or religious trust is
exempt from GST vide
S.No.13 of notification No.
12/2017-Central Tax (Rate)
dated 28.06.2017.

Agenda for 52nd GSTCM Volume 2
Page 15 of 34
Sl.
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Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
• It is proposed that Chapter
heading 9963 may be deleted
from Column No. 2 in the
notification No. 12/2017-
CT(R), the to remove
ambiguity. By doing so only
the entry of residential
dwelling falling under 9972
will be exempted.

• Further, an Explanation may
be inserted in Sl. No. 12 of
Notification No. 12/2017-
CT(R) dated 28.06.2017
stating that nothing contained
in this entry shall apply to:
(i) accommodation
services for students in
student residences; and
(ii) accommodation
services provided by
Hostels, Camps, Paying
Guest accommodations
and the like.
3 Ascertaining value of
land for deciding value of
construction services in
case of sale of
commercial /residential
apartments.
• As per paragraph 2 of the
Notification No. 11/2017-
Central Tax (Rate) dated 28th
June, 2017, in case of supply
of “construction service”,
involving transfer of land or
undivided share of land, the
value of such supply shall
be equivalent to the total
amount charged for such
supply less the value of
transfer of land or undivided
share of land, and the value
of such transfer of land or
undivided share of land,
shall be deemed to be one
third of the total amount
charged for such supply.

• Section 15(5) of CGST Act,
2017 empowers Government
to notify supplies the value
of which will be determined
in the manner as prescribed.
Accordingly, modalities of
valuation have been
prescribed, exercising this
power, on the
recommendations of the
Council.
• It is mentioned that a similar
request on valuation of land
based on pin code, area, etc.
was placed before 47th
meeting of GST Council
held in June, 2022, however
no action was recommended
Agenda for 52nd GSTCM Volume 2
Page 16 of 34
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Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
• However, Hon’ble High
Court of Gujarat in the case
of Munjaal Manishbhai
Bhatt Vs. UOI in SCA No.
1350 of 2O21 dated
06.05.2022, in para 122,
mandatory deduction of
1/3rd of total consideration
towards value of land is
declared ultra-virus. The
said para is shown below:
• “in the result, the impugned
Paragraph 2 of the
Notification No. 11/2017-
Central Tax (Rate) dated
28.06.2017 and identical
notification under the
Gujarat Goods and Services
Tax Act, 2017, which
provide for a mandatory
fixed rate of deduction of
1/3rd of total consideration
towards the value of land is
ultra- vires the provisions as
well as the scheme of the
GST Acts. Application of
such mandatory uniform
rate of deduction is
discriminatory, arbitrary
and violative of Article 14
of the Constitution of
India.”
• Further, in the said judgment
Hon. Gujarat High court
proclaimed that deduction of
1/3rd of the value of land will
be permitted at the option of
taxpayer. Relevant para 123
and 124 are given below;
“123 While we so conclude, the
question is whether the
impugned paragraph 2 needs
by the Council because the
matter has been litigated in
the courts and is sub-judice
at present.

• It is also mention that the
Gujarat High Court has not
only directed to deduct value
of land on actual basis where
it is ascertainable, but has
also ordered to refund the
excess amount of tax paid on
this count in the past. The
said order of the Hon’ble
High Court has been
contested before the
Supreme Court. Since an
appeal filed against the
Gujarat High Court order is
pending in the Hon’ble
Supreme Court.

• Fitment Committee
deliberated on the issue and
recommended that the matter
may be deferred.


Agenda for 52nd GSTCM Volume 2
Page 17 of 34
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Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
to be struck down or the same
can be saved by reading it
down. In our considered view,
while maintaining the
mandatory deduction of 1/3rd
for value of land is not
sustainable in cases where the
value of land is clearly
ascertainable or where the
value of construction service
can be derived with the aid of
valuation rules, such deduction
can be permitted at the option
of a taxable person particularly
in cases where the value of land
or undivided share of land is
not ascertainable.
124 The impugned paragraph
2 of Notification No. 11/2017-
Central Tax (Rate) dated 28th
June 2017 and the parallel
State tax
C/SCA/1350/2021CAV
JUDGMENT DATED:
06/05/2022 Notification is read
down to the effect that the
deeming fiction of 1/3rd will not
be mandatory in nature. It will
only be available at the option
of the taxable person incases
where the actual value of
land or undivided share in land
is not ascertainable.”

• In one of the search
operation, it is found that
promoter, involved in
construction of
commercial apartments,
has claimed 60%
deduction towards the
value of land. Taxpayer
has taken resort of the
above judgment of Hon.
Agenda for 52nd GSTCM Volume 2
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Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
Gujarat High Court and
paid GST on 40% of the
total amount charged for
such supply.
4. A request has been
received
MEITY to provide
clarification regarding
incentive amount that is
shared by acquirer bank
with other stakeholders
in the digital payment
ecosystem, as this also
comes under the purview
of the Gazette
notification issued to
notify the Incentive
scheme
• A Gazette notification was
issued in compliance with
the budget announcement
(FY 2021-22), to give
further boost to digital
transactions in the country.
• It was decided by
government to incentivise
the acquiring banks by way
of paying percentage of
value of RuPay Debit card
transactions and low value
BHIM UPI transactions for
a period of one year w.e.f
April, 2021.
Further, in the same
Gazette notification, it has
been notified that the
incentive will be shared by
the acquiring banks with
other stakeholders.
• Under the said scheme,
the Government has paid
incentive for FY2021-22
and is in process of
making Q4 FY2022-23
payment.
• Applicability of GST on
incentive paid by MeitY to
acquiring banks under
Incentive scheme for
promotion of RuPay Debit
Cards and low value BHIM-
UPI transactions was
examined in the 48th GST
Council meeting held on
17th December, 2022.
• Based on the
recommendations of the
GST Council meeting,
Circular 190/02/2023- GST
dated 13.01.2023 was issued
clarifying that incentives
paid by MeitY to acquiring
banks under the Incentive
scheme for promotion of
RuPay Debit Cards and low
value BHIM-UPI
transactions are in the nature
of subsidy and thus not
taxable.

• Clarification now being
sought by MeitY is regarding
incentive amount that is
further shared by acquiring
bank with other stakeholders
in the digital payment
ecosystem.

• In the Gazette Notification
dated 17th December 2021, it
was mentioned that ‘The
incentive will be shared by
Agenda for 52nd GSTCM Volume 2
Page 19 of 34
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No.
Proposal Details of Request Discussions in Fitment
Committee and its
recommendations
the acquiring banks with
other stakeholders. The
distribution of the incentive
amongst the stakeholder will
be decided by NPCI in
consultation with the Banks’.

• Further, vide Gazette
Notification dated 14th
January 2023, it was stated
that ‘The incentive will be
shared by the acquiring
banks with other payment
system participants and the
payment system operator, in
the proportion and manner
decided by NPCI in
consultation with the
participating banks’.

• The issue was discussed in
the Fitment Committee.
Karnataka stated that it shall
send a note on the issue and
the matter may be deferred.


Agenda for 52nd GSTCM Volume 2
Page 20 of 34
Agenda Item 6: Ad-hoc Exemptions Order(s) issued under Section 25(2) of Customs Act, 1962
to be placed before the GST Council for information
In the 26th GST Council meeting held on 10th March, 2018, it was decided that all ad hoc
exemption orders issued with the approval of Hon’ble Finance Minister as per the guidelines contained
in Circular No. 09/2014-Customs dated 19th August, 2014, as was the case prior to the implementation
of GST, shall be placed before the GST Council for information.
2. The details of the ad hoc exemption orders issued recently are as follows:

Order No. Date Remarks
AEO No. 06
of 2023
28.08.2023 Request from Disaster Management Division (DMD), MHA, for
Ad hoc exemption for import of instruments for implementation of
pilot project on Glacial Lake Outbrust Flood (GLOF) risk in Sikkim
(order copy enclosed ).
AEO No. 07
of 2023
29.08.2023 Request from Department of School Education & Literacy,
Ministry of Education for Ad hoc exemption for import of 1.15
million footballs for distribution amongst Schools in India (order
copy enclosed ).
AEO No. 08
of 2023
25.09.2023 Request from the Ministry of External Affairs for Ad hoc
exemption for import of Dornier Engines to be exported to
Seychelles (order copy enclosed ).

3. This is placed for the information of GST Council.


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Agenda for 52nd GSTCM Volume 2
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Agenda Item 7: Review of revenue position under Goods and Services Tax
1. The Figure below shows the trend and Table 1 shows the details of the collection in FY 2023-
24 vis-à-vis FY 2022-23.
Figure 1: Monthly gross GST collection (in ₹ lakh crore)

Table 1: Monthly gross GST collection (₹ crore)
GST Collection Apr’23 May’23 Jun’23 Jul’23 Aug’23
CGST 38,440 28,411 31,013 29,773 28,328
SGST 47,412 35,828 38,292 37,623 35,794
IGST 89,158 81,363 80,291 85,930 83,251
Domestic 54,186 39,591 41,256 44,691 39,701
Imports 34,972 41,772 39,035 41,239 43,550
Comp Cess 12,025 11,489 11,900 11,779 11,695
Domestic 11,124 10,431 10,872 10,939 10,679
Imports 901 1,057 1,028 840 1,016
Total 1,87,035 1,57,090 1,61,497 1,65,105 1,59,069


1.67
1.40 1.44 1.48 1.43
1.87
1.57 1.61 1.65 1.59
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
1.80
2.00
Apr May Jun Jul Aug
Trends In GST Collection(Rs. In lakh Crore)
GST Collection in FY 2022-23 GST Collection in FY 2023-24
Agenda for 52nd GSTCM Volume 2
Page 28 of 34

2. Table 2 shows the IGST collected, refunded, and settled/apportioned during FY 2023-24 till
August, 2023.
Table 2: IGST Collection/Settlement/Apportionment/Refund in FY23-24
(Figures in Rs. Crore)
1 Collections (+) 4,14,928.22
2 Recovery from IGST Ad-hoc apportionment (+) 0
3 Refunds (-) 60,406.71
4 Settlement (-)
i. CGST 1,94,822.80
ii. SGST 1,62,592.90
5 Ad-hoc Settlement (-) 0
i. CGST ad hoc 0
ii. SGST ad hoc 0
6 Net (1+2-3-4-5) (2,894.19)
Source: PrCCA, CBIC
Compensation Fund
3. As per provision of GST (Compensation to States) Act, 2017, the Compensation Cess collected
since implementation of GST w.e.f. 01.07.2017 till July, 2023 and the compensation released till
September, 2023 are shown in the table below:
There is recovery from some of the States i.e Arunachal Pradesh, Assam, Manipur, Tripura
Table 3: Compensation Cess collected and compensation released
(Figures in Rs. Crore)
2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24
Opening Balance 21,466 47,271 55,736 9,734^ 9,344 (27,961.59)
Compensation
Cess collected
(net)
62,612 95,081 95,551 85,191
1,04,609 1,25,863 46,316.35 (till
July, 2023)
Compensation
released
41,146 69,275 1,20,498 1,36,988 97,500 1,49,168 25,973.50 (till
Sep, 2023)
Balance 21,466 47,271 55,736* 3939 16,844$ (13,962)# (7,618.74)
* Centre had transferred Rs. 33,412 crore from CFI to Compensation Cess Fund as part of an exercise
to apportion balance IGST pertaining to FY 2017-18 on 01.06.2020.
^ Centre had transferred Rs. 5,795 crore from CFI to cess fund as part of an exercise to apportion
balance IGST pertaining to 2018-19 on 08.03.2022
$ Balance GST compensation cess available is Rs. 16844 crore. However, taking into account the
interest of back to back loan of Rs. 7,500 crore, GST compensation cess carried forward to FY 2022-
23 as opening balance is Rs. 9344 crore.
Agenda for 52nd GSTCM Volume 2
Page 29 of 34
# Balance GST compensation cess available is Rs. (-13,961.59) crore. However, taking into account
the interest of back to back loan of Rs. 14,000 crore, GST compensation cess carried forward to FY
2023-24 as opening balance is Rs. -27,961.59 crore.

Table 4: Status of AG’s certificate received and processed:
Name of State/UT 2017-18 2018-19 2019-20 2020-21 2021-22
1 Andhra Pradesh
2 Arunachal Pradesh
3 Assam
4 Bihar
5 Chhattisgarh
6 Delhi
7 Goa
8 Gujarat
9 Haryana
10 Himachal Pradesh
11 J & K
12 Jharkhand
13 Karnataka
14 Kerala
15 Madhya Pradesh
16 Maharashtra
17 Manipur
18 Meghalaya
19 Mizoram
20 Nagaland
21 Odisha
22 Puducherry
23 Punjab
24 Rajasthan
25 Sikkim
26 Tamil Nadu
27 Telangana
28 Tripura
29 Uttar Pradesh
30 Uttarakhand
31 West Bengal
AG's certificate pending
AG's certificate received

Agenda for 52nd GSTCM Volume 2
Page 30 of 34
States Revenue Comparison
4. The State-wise details of comparison of SGST revenue and the post settlement SGST revenue
(including ad-hoc settlement) for FY 2023-24 (April-August) as compared to FY 2022-23 (April-August) may
be seen in the Table 5.

Table 5: State-wise Revenue Comparison Q1 (FY 2023-24) vs Q1 (FY 2022-23)

Q1 (2023-24) vs Q1 (2022-23)
(Amount Rs. in Crore)
State
State/UT
Pre-
settlement
(Apr'22-
Aug'22)
Post-
Settlement
(Apr'22-
Aug'22)
Pre-
settlement
(Apr'23-
Aug'23)
Post-
Settlement
(Apr'23-
Aug'23)
SGST
Growth
(%)
SGST
Growth
Post
settlement
(%) Code
1
Jammu and
Kashmir
965 3,003 1,284 3,457 33% 15%
2 Himachal Pradesh 967 2,374 1,130 2,415 17% 2%
3 Punjab 3,248 7,775 3,555 9,052 9% 16%
4 Chandigarh 244 839 284 929 16% 11%
5 Uttarakhand 2,038 3,192 2,202 3,444 8% 8%
6 Haryana 7,662 12,420 8,304 14,403 8% 16%
7 Delhi 5,685 11,423 6,430 13,300 13% 16%
8 Rajasthan 6,455 14,006 7,167 16,060 11% 15%
9 Uttar Pradesh 11,637 27,643 13,552 30,822 16% 12%
10 Bihar 3,013 9,779 3,444 10,723 14% 10%
11 Sikkim 132 354 237 486 80% 37%
12 Arunachal Pradesh 220 692 306 882 39% 27%
13 Nagaland 87 395 131 455 51% 15%
14 Manipur 124 573 148 486 20% -15%
15 Mizoram 81 358 132 425 63% 19%
16 Tripura 175 589 223 667 28% 13%
17 Meghalaya 191 597 269 737 41% 23%
18 Assam 2,138 4,956 2,458 6,085 15% 23%
19 West Bengal 8,972 15,592 10,062 17,637 12% 13%
20 Jharkhand 3,080 4,545 3,824 5,152 24% 13%
21 Odisha 6,268 7,826 6,870 9,218 10% 18%
22 Chhattisgarh 3,215 4,529 3,505 5,484 9% 21%
23 Madhya Pradesh 4,452 10,927 5,334 13,139 20% 20%
24 Gujarat 15,820 22,978 17,439 26,870 10% 17%
25&26
Dadra and Nagar
Haveli & Daman
and Diu 283 482 268 471 -5% -2%
27 Maharashtra 35,239 51,722 42,053 61,783 19% 19%
29 Karnataka 14,417 25,957 16,628 30,369 15% 17%
Agenda for 52nd GSTCM Volume 2
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30 Goa 798 1,431 945 1,670 18% 17%
31 Lakshadweep 4 13 14 56 285% 335%
32 Kerala 4,999 12,127 5,819 13,080 16% 8%
33 Tamil Nadu 14,746 23,551 16,638 26,767 13% 14%
34 Puducherry 193 491 204 625 6% 27%
35
Andaman and
Nicobar Islands
85 210 99 229 16% 9%
36 Telangana 6,895 14,711 7,909 16,466 15% 12%
37 Andhra Pradesh 5,311 11,241 5,905 12,914 11% 15%
38 Ladakh 54 197 79 239 46% 21%
97 Other Territory 65 174 95 545 46% 214%
Grand Total 1,69,958 3,09,671 1,94,949 3,57,542 15% 15%

*Includes adhoc IGST settlement of Rs. 13,500 crore released to States in June’2022
Trends in Return filing
5. The table 6 shows the trend in return filing in FORM GSTR-3B and GSTR-1 till due date for return period
Jan’23 to May’23. Tables 7 and 8 show the State wise filing for these months.
Table 6: Return filing (GSTR-3B/GSTR-1) till due date
Return Period GSTR-3B (%) GSTR-1(%)
Jan’23 61% 61%
Feb’23 81% 63%
Mar’23 76% 58%
Apr’23 81% 60%
May’23 81% 60%
Jun’23 81% 59%
Jul’23 80% 60%
Aug’23 80% 60%


Agenda for 52nd GSTCM Volume 2
Page 32 of 34
Figure 3: GSTR-3B/GSTR-1 Filing till due date


61%
81%
76%
81% 81% 81% 80% 80%
63%
58%
60% 60% 59% 60% 60%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
1 2 3 4 5 6 7 8
GSTR-3B (%)
GSTR-1(%)
Agenda for 52nd GSTCM Volume 2
Page 33 of 34
Table 7: State-wise Return filing (GSTR-3B) till due date (Jan’23-Aug’23)


State/UT Jan-
23
Feb-
23
Mar-
23
Apr-
23
May-
23
Jun-
23
Jul-
23
Aug-
23
01 Jammu and Kashmir 45% 81% 73% 79% 80% 80% 79% 79%
02 Himachal Pradesh 62% 83% 79% 82% 82% 83% 81% 80%
03 Punjab 75% 82% 79% 85% 84% 84% 84% 83%
04 Chandigarh 78% 85% 81% 86% 86% 84% 84% 85%
05 Uttarakhand 56% 78% 74% 79% 78% 79% 78% 78%
06 Haryana 73% 82% 79% 83% 82% 82% 81% 82%
07 Delhi 71% 82% 80% 82% 81% 83% 81% 81%
08 Rajasthan 70% 82% 77% 83% 82% 82% 81% 80%
09 Uttar Pradesh 53% 82% 76% 82% 82% 82% 81% 81%
10 Bihar 33% 77% 71% 75% 76% 78% 77% 76%
11 Sikkim 37% 76% 71% 76% 75% 78% 77% 76%
12 Arunachal Pradesh 27% 70% 58% 64% 64% 69% 67% 68%
13 Nagaland 33% 73% 66% 71% 72% 74% 73% 73%
14 Manipur 26% 65% 53% 28% 38% 46% 54% 54%
15 Mizoram 22% 74% 73% 75% 76% 78% 74% 79%
16 Tripura 49% 82% 72% 81% 81% 83% 81% 80%
17 Meghalaya 30% 74% 72% 73% 77% 82% 75% 76%
18 Assam 41% 73% 63% 71% 73% 73% 72% 70%
19 West Bengal 57% 83% 79% 83% 83% 83% 82% 82%
20 Jharkhand 51% 81% 75% 80% 80% 81% 80% 80%
21 Odisha 44% 77% 72% 76% 74% 78% 77% 74%
22 Chhattisgarh 54% 72% 63% 72% 73% 73% 73% 71%
23 Madhya Pradesh 58% 79% 70% 78% 78% 78% 78% 77%
24 Gujarat 85% 89% 84% 88% 88% 87% 87% 87%
25 Dadra and Nagar
Haveli &
Daman and Diu
78% 81% 76% 82% 81% 81% 80% 79%
27 Maharashtra 69% 80% 74% 79% 79% 79% 78% 77%
29 Karnataka 61% 82% 75% 79% 80% 81% 80% 79%
30 Goa 54% 76% 69% 74% 75% 75% 74% 73%
31 Lakshadweep 60% 71% 69% 69% 71% 76% 75% 73%
32 Kerala 63% 80% 71% 78% 79% 78% 77% 79%
33 Tamil Nadu 63% 84% 78% 83% 84% 84% 82% 83%
34 Puducherry 57% 79% 75% 79% 79% 79% 77% 77%
35 Andaman and Nicobar Is 49% 69% 61% 66% 66% 67% 66% 66%
36 Telangana 49% 77% 70% 76% 77% 78% 76% 76%
37 Andhra Pradesh 58% 80% 72% 78% 79% 79% 78% 77%
38 Ladakh 40% 76% 73% 72% 71% 74% 67% 66%
97 Other Territory 75% 78% 81% 77% 75% 79% 76% 77%
Total 61% 81% 76% 81% 81% 81% 80% 80%
Agenda for 52nd GSTCM Volume 2
Page 34 of 34
Table 8: State-wise Return filing (GSTR-1) till due date (Jan’23-Aug’23)
State/UT
Jan-
23
Feb-23
Mar-
23
Apr-
23
May-
23
Jun-
23
Jul-23
Aug-
23
01 Jammu and Kashmir 45% 45% 37% 41% 40% 38% 42% 41%
02 Himachal Pradesh 62% 63% 51% 61% 59% 49% 62% 62%
03 Punjab 75% 80% 72% 78% 77% 72% 77% 76%
04 Chandigarh 78% 81% 75% 80% 78% 73% 79% 78%
05 Uttarakhand 56% 58% 50% 57% 55% 50% 56% 55%
06 Haryana 73% 75% 70% 74% 72% 69% 73% 73%
07 Delhi 71% 75% 74% 74% 72% 73% 73% 72%
08 Rajasthan 70% 71% 63% 70% 69% 64% 69% 68%
09 Uttar Pradesh 53% 52% 48% 50% 51% 48% 50% 50%
10 Bihar 33% 32% 29% 31% 31% 30% 31% 31%
11 Sikkim 37% 43% 36% 40% 39% 39% 40% 39%
12 Arunachal Pradesh 27% 32% 25% 23% 27% 27% 28% 27%
13 Nagaland 33% 35% 31% 33% 31% 33% 31% 32%
14 Manipur 26% 25% 25% 13% 17% 22% 23% 25%
15 Mizoram 22% 24% 22% 25% 24% 25% 27% 24%
16 Tripura 49% 49% 42% 46% 46% 45% 46% 44%
17 Meghalaya 30% 35% 28% 32% 32% 33% 33% 34%
18 Assam 41% 42% 35% 39% 38% 36% 39% 38%
19 West Bengal 57% 58% 53% 56% 56% 53% 56% 55%
20 Jharkhand 51% 49% 46% 48% 47% 46% 47% 47%
21 Odisha 44% 45% 39% 42% 42% 39% 43% 43%
22 Chhattisgarh 54% 53% 44% 52% 52% 48% 54% 53%
23 Madhya Pradesh 58% 57% 45% 54% 53% 47% 54% 53%
24 Gujarat 85% 86% 81% 84% 84% 82% 84% 84%
25
Dadra and Nagar
Haveli &
Daman and Diu
78% 80% 78% 80% 79% 78% 79% 79%
27 Maharashtra 69% 72% 66% 69% 68% 67% 70% 69%
29 Karnataka 61% 63% 57% 57% 58% 58% 59% 59%
30 Goa 54% 62% 57% 59% 59% 60% 60% 60%
31 Lakshadweep 60% 58% 50% 51% 45% 54% 54% 52%
32 Kerala 63% 65% 58% 62% 61% 60% 62% 60%
33 Tamil Nadu 63% 64% 59% 61% 60% 60% 60% 61%
34 Puducherry 57% 57% 53% 54% 52% 54% 53% 53%
35 Andaman and Nicobar I 49% 47% 40% 46% 43% 43% 44% 42%
36 Telangana 49% 53% 49% 50% 49% 50% 50% 50%
37 Andhra Pradesh 58% 58% 51% 53% 52% 52% 53% 52%
38 Ladakh 40% 42% 36% 33% 37% 37% 37% 36%
97 Other Territory 75% 77% 79% 74% 78% 78% 78% 77%
Total 61% 63% 58% 60% 60% 59% 60% 60%
Agenda for 52nd GSTCM Volume 2
Agenda for 52nd GSTCM Volume 2
Page 1 of 3
Addendum to Agenda Volume-II for the 52nd meeting of the GST Council
Agenda Item 9: Agenda Note for notifying supplies and class of registered person eligible for
refund under IGST route.
Vide section 123 of the Finance Act, 2021, sub-section (3) of section 16 of the Integrated Goods
and Services Tax Act, 2017 (hereinafter referred to as the “IGST Act”) has been substituted with sub-
sections (3) and (4) as below:
“(3) A registered person making zero rated supply shall be eligible to claim refund of unutilised
input tax credit on supply of goods or services or both, without payment of integrated tax, under
bond or Letter of Undertaking, in accordance with the provisions of section 54 of the Central
Goods and Services Tax Act or the rules made thereunder, subject to such conditions,
safeguards and procedure as may be prescribed:

Provided that the registered person making zero rated supply of goods shall, in case of
non-realisation of sale proceeds, be liable to deposit the refund so received under this sub-
section along with the applicable interest under section 50 of the Central Goods and Services
Tax Act within thirty days after the expiry of the time limit prescribed under the Foreign
Exchange Management Act, 1999 for receipt of foreign exchange remittances, in such manner
as may be prescribed. 42 of 1999.

(4) The Government may, on the recommendation of the Council, and subject to such
conditions, safeguards and procedures, by notification, specify––
(i) a class of persons who may make zero rated supply on payment of integrated tax and claim
refund of the tax so paid;
(ii) a class of goods or services which may be exported on payment of integrated tax and the
supplier of such goods or services may claim the refund of tax so paid.”

2. The GST Council in its 50th meeting held on 11th July 2023, recommended that provisions of
Section 123 of Finance Act, 2021, amending Section 16 of the IGST Act, to be notified with effect from
1st October 2023. Accordingly, the Notification No. 27/2023-Central Tax dated 31.07.2023 was issued.
In the same meeting, the GST Council also recommended issuance of a notification under Section 16(4)
of the IGST Act, 2017 to provide for the restriction of the IGST refund route in respect of exports of
certain goods like tobacco, pan masala, and other similar items. The GST Council also approved the
Notification under Section 16 (4) of IGST Act vide which all goods or services (except the goods
specified in column (3) of the TABLE in the said Notification) were notified as the class of goods or
services, which may be exported on payment of integrated tax and on which the supplier of such goods
or services may claim the refund of tax so paid. Accordingly, Notification No. 01/2023-Integrated
Tax dated 31.07.2023 was issued and has come into effect from 01.10.2023.

3. The effect of this Notification is that now the exports of all the goods or services (except the
goods specified in column (3) of the TABLE in the said Notification) can be made on payment of
integrated tax and the refund of tax so paid can be claimed by the supplier of such goods or services.
However, the unintended consequence of this notification has been to restrict the Zero rated supplies
made to a SEZ developer or a SEZ unit for authorized operations on payment of integrated tax and to
make LUT as the default route for claiming refunds of unutilised ITC for such supplies.
52nd GSTCM Addendum to Volume-II
Page 2 of 3

4. The intention of the said amendment was to prevent the misuse of the IGST route in respect of
evasion prone commodities as proper officer of customs do not have access to the GST portal and
therefore, may not be in a position to verify the refund claim properly. Whereas in case of refund of
unutilised ITC in case of exports made under LUT route, the jurisdictional GST officers processing the
refund have access to all returns and other documents available on GST portal and are in better position
to verify such refund claim in details. Thus, it was decided that IGST refund route for goods may be
kept open only for some specified class of supplies or class of persons who make zero rated supplies in
respect of which the probability of misuse of the scheme are minimal. It is mentioned that all the refunds
in respect of supplies made to a SEZ developer or a SEZ unit for authorized operations, both in cases
of LUT route as well as IGST payment route, are processed by the jurisdictional tax officers only and
not by the Customs.

5. Further, the matter was discussed in 50th GST Council meeting held on 11.07.2023 (Agenda
Note No. 3(ii)), in respect of recommendations of Group of Ministers on Capacity based taxation which
had recommended restricting IGST refund route in respect of certain evasion prone goods like pan
masala, tobacco, mentha oil etc. and the Notification No. 01/2023-Integrated tax was issued
accordingly. Neither the GoM had recommended restricting IGST refund route for supplies made to a
SEZ developer or a SEZ unit for authorized operations nor had the Council recommended the same in
50th meeting. Therefore, it appears that non-inclusion of supplies to a SEZ developer or a SEZ unit for
authorized operations on payment of integrated tax has unintendedly been left out of the coverage of
the said Notification.

6. Accordingly, it is proposed to amend Notification No. 01/2023- Integrated Tax, dated 31st July,
2023, w.e.f. 01.10.2023 by insertion (shown in red colour below) so as to include all the suppliers to a
Special Economic Zone developer or a Special Economic Zone unit for authorised operations as class
of persons who may make supply of goods or services to the Special Economic Zone developer or the
Special Economic Zone unit for authorised operations on payment of integrated tax and on which the
supplier of such goods or services may claim the refund of tax so paid.
“In exercise of the powers conferred by sub-section (4) of section 16 of the Integrated
Goods and Services Tax Act, 2017 (13 of 2017) (hereafter referred to as the “said Act”),
the Central Government on the recommendations of the Council, hereby notifies
(i) all goods or services (except the goods specified in column (3) of the TABLE below)
as the class of goods or services which may be exported on payment of
integrated tax and on which the supplier of such goods or services may claim the
refund of tax so paid; and
(ii) all suppliers to a Special Economic Zone developer or a Special Economic Zone unit
for authorised operations as the class of persons who may make supply of goods or
services to the Special Economic Zone developer or the Special Economic Zone unit
for authorised operations on payment of integrated tax and on which the said suppliers
may claim the refund of tax so paid:”
7. The agenda note along with draft notification (at Annexure A) is placed before the GST Council
for deliberation and approval.
***
52nd GSTCM Addendum to Volume-II
Page 3 of 3
Annexure “A”
[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II,
SECTION 3, SUB-SECTION (i)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

NOTIFICATION
No. xx/2023 – Integrated Tax
New Delhi, the XXth October, 2023

G.S.R……(E):—In exercise of the powers conferred by sub-section (4) of section 16 of Integrated
Goods and Services Tax Act, 2017 (13 of 2017), the Central Government, on the recommendations of
the Council, hereby makes the following amendment in the notification of the Government of India in
the Ministry of Finance (Department of Revenue) No. 01/2023-Integrated Tax, dated the 31st July, 2023,
published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R.
578 (E), dated the 31st July, 2023, namely:-
In the said notification, after the words and letters “hereby notifies”, the words and letters “all goods or
services (except the goods specified in column (3) of the TABLE below) as the class of goods or
services which may be exported on payment of integrated tax and on which the supplier of such
goods or services may claim the refund of tax so paid:” shall be substituted and shall be deemed to have
been substituted with effect from 1st October, 2023, by the following words, letters, figures and brackets,
namely,
“(i) all goods or services (except the goods specified in column (3) of the TABLE below) as the class
of goods or services which may be exported on payment of integrated tax and on which the supplier of
such goods or services may claim the refund of tax so paid; and
(ii) all suppliers to a Special Economic Zone developer or a Special Economic Zone unit for authorised
operations as the class of persons who may make supply of goods or services to the Special Economic
Zone developer or the Special Economic Zone unit for authorised operations on payment of integrated
tax and on which the said suppliers may claim the refund of tax so paid:”.

[F. No. CBIC-xxx/x/xxxx-GST]

(Raghavendra Pal Singh)
Director
Note: The principal notification No. 01/2023- Integrated Tax, dated the 31st July, 2023, was published
in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 578(E),
dated the 31st July, 2023.
52nd GSTCM Addendum to Volume-II