Top CGST Amendment Act 2018 Updates Applicable from 1st February 2019

Overview of CGST Amendment Act 2018  

The government has published below amendment in the act through official Gazette on 30 August 2018. However, it is going to be applicable from 1st February 2019.

Important Changes in CGST ACT 2017

You can find some of the important changes made in CGST ACT 2017 through CGST Amendment Act 2018, which is going to be effective from 1st February 2019.

1. CGST Section 2 – Definitions amendment:

Central Board of Excise and Customs will get replaced with Central Board of Indirect Taxes and Customs.

For the purpose of Section 171(2) the word "Appellate Authority & the Appellate Tribunal" will get substituted with the "Appellate Authority, the Appellate Tribunal, and the Authority."

2. CGST Section 7 – Scope of supply amendment:

(i) In clause (b), after the words or furtherance of a business, the word and is inserted and will always be deemed to be inserted

(ii) In clause (c), after the words a consideration, the word and shall be omitted and shall always be deemed to be omitted;

3. CGST Section 9 – Levy and Collection amendment:

For sub-section (4), the following sub-section got added.

By CGST amendment act 2018 notificationon the recommendations of the Council, the government specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.”

Clarification: Earlier the reverse charge mechanism was postponed till 30.09.2019. However, in the 31st GST council meeting, it was decided to make this applicable for a specific class of registered person and not for everyone.

Therefore, the government will notify in future, which class of taxpayers will need to pay GST on a Reverse charge basis. Also, this will be applicable for intra-state, inter-state and union-territory dealers.

Till then Reverse charge mechanism will not be applicable to the registered person for receiving goods or services from UN-registered person.

4. CGST Section 10 – Composition Levy amendment:

(a) in sub-section (1) — (i) In place of the words in lieu of the tax payable by him, an amount calculated at such rate, the words, brackets and figures in lieu of the tax payable by him under sub-section (1) of section 9, an amount of tax calculated at such rate shall be substituted;

(ii) One Crore Rupees will get replaced with One Crore and fifty Lakh Rupees.

As per this clause, a person can opt for composition scheme whose previous year turnover is equal to or less than 1.5 Cr. Rupees. Earlier this limit was 1 Cr. only.

Also, they are allowed to opt for services under composition scheme for a turnover up to a value not exceeding 10 per cent in the previous financial year, or 5 Lakh rupees, whichever is higher.