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GST Compendium - October 2020

Due to the ongoing pandemic, the businesses were finding it difficult to complete their annual returns and GST audit for financial year 2018-19 within the due date of 30 September 2020. Various representations were made by trade and industry to extend these timelines. The government has accordingly extended the due date till 31 October 2020.

On the judicial front, the Madras High Court has denied the refund of input tax credit on input services under the inverted duty structure stating it to be intra-vires the Act and a valid exercise of the legislative powers. The judgment is in sharp contrast to the decision of the Gujarat High Court in case of VKC Footsteps India Pvt. Ltd. where it had allowed the refund of input tax credit on input services. The divergent rulings have created dilemma for the industry vis-à-vis the inverted duty structure and is likely to lead to further litigation, unless

the department clarifies its position, or the matter is finally decided by the Supreme Court.

In another significant ruling by Haryana Authorities of Advance Ruling, it has been held that the services, such as accounting, marketing support, administrative support, IT support, supplied by head office to its branch offices shall be treated as supplies exigible to GST. Similar ruling was pronounced earlier by the Karnataka AAAR in case of M/s. Columbia Asia Hospitals Pvt. Ltd. There is a need for the authorities to look in this matter and address the concerns of the industry to avoid unnecessary litigation.

This edition also focuses on some of the key issues being faced by the pharma sector under the GST regime. Amidst COVID-19 crisis, there is an urgent need to address these issues and provide necessary relief to this sector.

We hope you will find this edition informative and interesting.