The Central Board of Indirect Taxes and Customs (the CBIC) vide Notification No. 20/2024-Central Tax dated 8 October 2024, has amended the Central Goods and Services Tax Rules, 2017 (‘the CGST Rules’). The key amendments under the CGST Rules are summarized hereinbelow

1. Insertion of Rule 47A providing time limit for self-invoicing under reverse charge mechanism (‘RCM’)

Where recipients are required to issue self-invoice with respect to supplies of goods/ services on                       which GST is payable under RCM, the tax invoice should be issued within 30 days from date of the                   receipt of said supply of goods/ services

       2. Insertion of Rule 163 prescribing conditions for closure of proceeding under Section 128A for                 demands raised under section 73

New Rule 163 introduced under the CGST Rules prescribing procedures and conditions to avail the                  benefit of waiver of interest and penalty under Section 128A. Key aspects of the new Rule 163 are as                follows:

• Application filing for waiver:
  • Taxpayers who are eligible for waiver of interest or penalty or both under section 128(1)(a) (i.e., in case of Show Cause Notice) may file an application in Form GST SPL-01 on the GST common portal, providing details of the notice or statement along with payment made through Form GST DRC-03
  • For the application under section 128(1)(b) and 128(1)(c) (i.e., in case of demand order), the taxpayer may file an application in Form GST SPL-02 on crediting the payment of tax amount in the electronic liability register
• Conditions in case of partial demand:
  • Application can be only filed after the full payment of tax demand in the said notice or statement or order (including the erroneous refund)
  • Where SCN or demand order covers multiple years including years not covered for benefit under section 128A, application for interest and penalty waiver can be filed only after full payment of tax demand for all the years
  • Amount payable shall be the balance of the tax payable after reducing the amount not payable in accordance with Section 16(5) and 16(6) (i.e., ITC for the FY 2017-18 to 2020-21 claimed up to 30 November 2021)
• Time limits:
  • Application can be submitted within 3 months from date Section 128A got notified i.e., from 1 November 2024, with provisions allowing a period of 6 months in certain cases
  • Proper officers are required to issue a notice within 3 months if they intend to reject the application of the taxpayers, giving an opportunity to reply within 1 month
  • If no order is issued by the proper officer within the prescribed time frame, the application will deemed to be approved, and the proceedings shall deemed to be concluded
• Withdrawal of appeal:
  • Taxpayer’s application for waiver shall contain document evidencing the withdrawal of appeal or writ petition, if any filed
  • In cases if the withdrawal order of appeal is not issued, then the application of withdrawal shall be submitted during filing of application and order must be uploaded within one month of issuance
• Rejection of application:
  • In case of rejection of application under Section 128A, an appeal against the rejection order can be filed as per Section 107 of the CGST Act
  • If a taxpayer withdraws original appeal to apply for a waiver under Section 128A, that original appeal can be restored if the waiver application is rejected by Proper officers or subsequently by appellate authority