GST GST Advisory

Amendments in GST Rule – with effect from January 1, 2021

GST Amendment - with effect from January 1, 2021

The changes are introduced in the GST Act. The changes have come in the light of increasing bogus and fake GST bills made by the business houses. The fake invoices and counterfeit firms have resulted in the arrest of the individuals. CBIC has issued a couple of notifications relating to the CGST 2017 and CGST Rules, 2017[1], which are applicable from January 1 2021. In this article, we are describing, GST Amendment rule with effect from January 1.

Important GST Amendments/ Key Amendments

This amendment is good news for the small and medium-size business players.

  • The first important GST Amendment is the rolling out the quarterly filing of the GST return.
  • The government has instead launched the QRMP- Quarterly Filing of Return with Monthly Payment scheme from January 1 2021.
  • The impact of the scheme is on 94 lakhs taxpayers, which is almost 92% of the current tax base.
  • For small taxpayers, it is important to file only 8 tax GST returns, where there are 4 GSTR-1 and 4 GSTR 3B in a financial year. In the past, the Taxpayer was making 16 GST Returns in that financial year.
  • The taxpayers will be able to make GST payments every month via challan doing a self-assessment of monthly payment of 35% of the net cash liability of GSTR-3B in the previous quarter.

The scheme is available to the Taxpayer whose aggregate turnover is 5 Crores in the last preceding financial year. There was the filing of GST-3B return by October 2020 by November 30.

Top 12 -GST Amendments as follows:

12 Important GST Amendments
  1. Cancellation of GSTIN –A Power with the Department increased
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The officer can cancel/suspend the GSTIN without giving the opportunity of being heard to the Taxpayer when he has exceeded his authority to take input tax credit under Section 16. A clause (e) has been inserted in Rule 21 of the CGST Rules, 2017, where the tax officer has the reason to believe that the registration of the person is liable to be cancelled.

  1. No Refund if GST has been suspended

The GSTIN has been suspended under Section 54 of the CGST Act 2017, no tax refund can be availed by the tax payer. Meanwhile the tax refund proceedings must be imitated for applying the rebate in the court.

  1. Input Tax Credit

Where there is a restriction on the claim of ITC as per Rule 36(4). According to this provision, the claim of ITC can only be availed up to 5% when the corresponding vendor has not submitted the tax invoices in the GSTR2B. If the claim has exceeded the limit, it shall result in the violation of the CGST. It may result in a violation of GSTIN.

  1. Restriction to avail ITC-as per the Rule of 86B under GST Amendment

A new rule has been added from January 1, 2021; a restriction has been placed on the utilizing of the 99% of the tax liability from the ITC-Input Tax Credit, where the value of the taxable supplies have been other than the exempt supply and zero-rated supply it exceeds 50 lakhs rupees in a month.

There have been some exceptions attached to this Rule 86B under GST Amendment

  • Income tax has been paid up to 1 Lakh rupees in the 2 preceding financial year
  • A refund has been received by the Taxpayer of Rs. 1 Lakh under section 54 of CGST Act 2017.
  • A taxpayer has made the electronic cash ledger pay the liabilities on outward supplies, which is cumulatively 1% of the total liability of the said month.
  • That person is government undertaking that is Public Sector Undertaking- PSU, Government Department, Local Authority or Statutory Authority
  • This person who is restricted under GST Amendment to avail ITC as per the Section 86 B shall not be allowed to file the GSTR-3B for the previous year.
  1. GSTR 1 blocked in case non-filing of the GSTR-3B
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The Taxpayer has failed to file the two subsequent GSTR-3B, for the two succeeding months, his GSTR 1 shall be blocked.

Where the Taxpayer has failed to file the GSTR-3B for the preceding quarter, he shall not be permitted to file the GSTR-1 of the subsequent quarter.

  1. Tax computation shall be equal for the GSTR 1 and GSTR-3B

The department has the authority under the new GST Amendment to cancel the GSTIN- when the liability declared in GST R3B is less than in the GSTR1 in that particular month.

  1. E-way Bill

The E-Way bill is permitted up to the distance of 200Km. This implies that two day validity is given to the e-way bill up to 200kms.

The e-way bill cannot be generated for the periods when the tax return has not been submitted for the two consecutive periods.

  1. GST Amendment of Section 31 of CGST

According to this amendment, a new category of services or supplies has been added, for which tax invoice shall be issued, in such time and such manner as may be prescribed.

  1. Amendment in Section 51(3) and 51(4) of CGST

The non-furnishing of TDS Certificate within 5 days has been removed from Section 51(4)

  1. GST Registration

According to the Rule, 8(4A) has been substituted with the new rule that, every GST registration shall be accompanied with the Aadhar Card, or the biometric information needs to be submitted along with the photograph and the know your customer –KYC, if Aadhar has been failed to be submitted.

  1. Time Limit for GST Registration changed
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The time limit for the GST Registration has been changed from 7 to 3 working days, from application submission date.

  1. Waiver of late fees for the Form GSTR-4 in Ladakh

This means that there will not be any late fees in delay in furnishing the GSTR-4 for the F/Y-2019 -2020 till December 31 for the composite dealers located in the Ladakh Union Territory.


It can be well said that these GST Amendments are a way to stop the tax leakages in the economy. The GST amendments about the registration and cancellation and restrictions on the GSTR1 filing of return has been done to prevent tax evasions.

The benefits of these GST Amendments are more in terms of reducing the tax burden on the small scale taxpayers. The compliance burden was overall increased with GST. Keeping a check on the Input Tax Credit and Invoice Filing Facility are the new features of this GST Amendment. This helps in keeping track of monthly taxes by pre-filled challan and cash ledger. The overall GST Amendment is to increase the tax payments and reduce tax evasions from the systems.

Read our article:Recent Amendment under GST in Debit Note and Credit Note

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