Section 37 of GST – Furnishing details of outward supplies

Section 37 of GST – Furnishing details of outward supplies. Everything you want to know about for GST Section 37, In this section you may find all details for Furnishing details of outward supplies  as per GST Act 2017.

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Section 37 of GST – Furnishing details of outward supplies

(1) Every registered taxable person, other than an input service distributor, a non-resident taxable person and a person paying tax under the provisions of section 10, section 51 or section 52, shall furnish, electronically, in such form and manner as may be prescribed, the details of outward supplies of goods or services or both effected, during a tax period on or before the tenth day of the month succeeding the said tax period and such details shall be communicated to the recipient of the said supplies within the time and in the manner as may be prescribed:

Provided that the registered person shall not be allowed to furnish the details of outward supplies during the period from the eleventh day to the fifteenth day of the month succeeding the tax period:

Provided further that the Commissioner may, for reasons to be recorded in writing, by notification, extend the time limit for furnishing such details for such class of taxable persons as may be specified therein:

Provided also that any extension of time limit notified by the Commissioner of State tax or Commissioner of Union territory tax shall be deemed to be notified by the Commissioner

(2) Every registered person who has been communicated the details under sub-section (3) of section 38 or the details pertaining to inward supplies of Input Service Distributor under sub-section (4) of section 38, shall either accept or reject the details so communicated, on or before the seventeenth day, but not before the fifteenth day, of the month succeeding the tax period and the details furnished by him under sub-section (1) shall stand amended accordingly.

(3) Any registered person, who has furnished the details under sub-section (1) for any tax period and which have remained unmatched under section 42 or section 43, shall, upon discovery of any error or omission therein, rectify such error or omission in such manner as may be prescribed, and shall pay the tax and interest, if any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period:

Provided that no rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after furnishing of the return under section 39 for the month of September following the end of the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier

“Provided further that the rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after furnishing of the return under section 39 for the month of September, 2018 till the due date for furnishing the details under sub-section (1) for the month of March, 2019 or for the quarter January, 2019 to March, 2019.”.

Explanation.––For the purposes of this Chapter, the expression “details of outward supplies” shall include details of invoices, debit notes, credit notes and revised invoices issued in relation to outward supplies made during any tax period.

Related provisions of the Statute

Section or RuleDescription
Section 2(82)Definition of Output Tax
Section 2(83)Definition of Outward Supply
Section 2(94)Definition of Registered Person
Section 2(97)Definition of Return
Section 2(117)Definition of Valid Return
Section 16Eligibility and Conditions for Taking Input Tax Credit
Section 17Apportionment of Credits and Blocked Credits
Section 22Persons liable for registration
Section 24Compulsory registration in certain cases
Section 38Furnishing details of inward supplies
Section 39Furnishing of Returns
Section 47Levy of late fee
Section 14 (IGST)Special provision for payment of tax by a supplier of online information and database access or retrieval services.

Introduction

This provision relates to furnishing of details of outward supplies by the supplier.

Analysis

(a) A return of Outward supplies in terms of this section should be furnished by every registered taxable person except for the following persons namely,

— Input service distributor

— A non-resident taxable person

— A person paying tax under the provisions of section 10 (composition levy)

— A person paying tax under the provisions of section 51 (TDS)

— A person remitting tax collected under the provisions of section 52 (TCS)

— A person referred to in Section 14 of IGST Act

– Person providing Online Information and Data Access & Retrieval Services to a non-taxable online recipient.

(b) Explanation to section 37 relating to furnishing of the “details of outward supplies” shall include details of Invoices, debit notes, credit notes and revised invoices issued in relation to outward supplies made during any tax period. This e-return shall be filed within 11 days from the end of the tax period in FORM GSTR-1 (to be substituted with ANX-1) in case of taxpayer having turnover more than Rs 1.5 Crore. (Refer Annexure ‘A’ for extension of due date for filing GSTR-1).

(c) Such returns shall be for supply of goods or services or both as effected during a tax period and shall be filed electronically.

(d) The Commissioner is empowered to notify any extension of due date of filing, for any class of persons, beyond the tenth of the succeeding month, with reasons to be recorded in writing. Refer to Annexure ‘A’ at the end of the chapter, for extensions notified, from time to time, for various returns.

(e) The details provided by the supplier in GSTR-1 shall be auto-populated and made available electronically to the recipient, for matching purposes, in accordance with the provision of Rule 60 in a FORM GSTR-2A (to be substituted with ANX-2), which can be used for reconciliation and filing of GSTR-9 i.e. Annual return.

(f) The present process of return filing, envisages that the recipient of the supply shall be provided an opportunity to accept, reject, amend or delete the details in a two-way communication process. This opportunity is not available at present as filing of GSTR-2 has been deferred.

(g) If any error or omission is discovered in the course of matching as specified in the Act and discussed under Section 42 and 43, rectifications of the same shall be effected; and tax and interest, if any, as applicable shall be paid on such corrections by the person responsible for filing the return of outward supplies. Section 42 and section 43 are currently not applicable as the due dates for filing of details in GSTR-2 is yet to be notified.

(h) Such rectification of error or omission, however, is not permitted after filing of annual return or the return for the month of September of the following financial year to which the details pertain to, whichever is earlier. However, GST council has decided to provide relaxation to the tax payer for the financial year 2017-18 vide the Central Goods and Services Tax (Second Removal of Difficulties) Order, 2018, after considering the fact that financial year 2017-18 was the first year of the implementation of the Goods and Services Tax in India and the taxpayers were still in the process of familiarising themselves with the new taxation system and due to lack of said familiarity-

(i) the registered persons eligible to avail input tax credit could not claim the same in terms of provisions of section 16 because of missing invoices or debit notes referred to sub-section (4) within the stipulated time;

(ii) the registered persons could not rectify the error or omission in terms of provisions of sub-section (3) of section 37 within the stipulated time

Therefore, any error or omission pertaining to the financial year 2017-18 can be rectified till the due date for furnishing the details under sub-section (1) for the month of March, 2019 or for the quarter January, 2019 to March, 2019.

For example: Assume an entity has furnished the annual returns for the year 2018-19 on August 15, 2019. If an error is discovered in respect of a transaction pertaining to the tax period July 2018, where the entity has filed its returns for the month of September 2019 on October 18, 2019. In this case, the rectification of the error pertaining to a transaction in July 2018 cannot be made beyond August 15, 2019. This is because the said entity has already filed its annual return on 15th August, 2019.

Linking E-Way Bill with GSTR-1

Every registered person who causes movement of goods of consignment value exceeding Rs. 50,000/- or Rs. 1, 00,000/- as the case may be, in relation to supply, or for reason other than supply such as sale of goods on approval basis, job work etc., or due to inward supply from an unregistered person excluding exempted goods needs to furnish information relating to the said goods and thereby, furnish details of invoices while generating e-way bills. Further, the invoice details for business to business supplies have to be given in FORM GSTR-1 by the tax payer. To avoid duplicate data entry, GSTN has provided a facility to taxpayers, where e-way bill data of a tax period can be imported by the taxpayer in their FORM GSTR-1. If the number of e-way bills generated in a month are:

§ up to 50 only, the invoice details can be directly imported into the respective Tab of Form GSTR 1, without using the offline tool.

§ more than 50 but less than 500, invoices can be downloaded in three separate CSV files with data pertaining to B2B transactions, B2CL transactions and HSN summary. These files can then be imported into FORM GSTR-1 offline tool.

§ more than 500, the invoice details in respect of B2B transactions, B2CL transactions and HSN summary can be imported from E-Way Bill portal in a single excel file. This file can then be imported into FORM GSTR-1 offline tool.

However, the data so imported can be edited while filing FORM GSTR-1.

It is pertinent to mention here that ‘import EWB data’ option in the GSTN portal and selection of requisite data of invoices to be uploaded in the GSTR-1 is an option, made available to ease the return filing procedure and the same is not mandatory .Where the user decides not to use the option, details of such invoices are to be filed manually.

Matching details given in FORM GSTR-1 with those given in the e-way bill will curb tax evasion as evident from certain facts revealed like some transporters are doing multiple trips by generating only a single e-way bill or not reflecting invoices for which e-way bill is generated while filing FORM GSTR-1 or e-way bill is not being generated even as supplies are being made etc.

However, certain points to be considered while reconciling e-way bills generated with the data declared in GST returns so that frivolous demands are not raised:

  • movement of goods over and above a threshold limit require generation of e-way bill while data declared in FORM GSTR-1 includes all the supplies regardless of any threshold,
  • in case of supply of services, no e-way bill is required to be issued while the same needs to be duly reported in FORM GSTR-1,
  • varied State-specific requirements, such as different threshold limits and notified products for which e-way bills are required,
  • reconciliation of the value of supplies considering the credit notes (tax or financial) issued later by the supplier to factor the discounts, deficiency, etc. for the customer,
  • In case where goods are transported by job worker, the e-way bill will be generated on the basis of Delivery Challan and not on the basis of tax invoice issued by job worker for job work charges. The value of goods moved on the basis of Delivery Challan is not to be reported in FORM GSTR-1 and neither there is mention of tax invoice issued by job worker for job work charges in e-way bill; therefore, no data would be auto-populated in FORM GSTR-1 of the job worker.

Components of valid GST Return for Outward Supplies made by the Taxpayer (FORM GSTR-1)

This Statement of outward supplies would capture the following information:

1. GSTIN

2. Name

3. Period to which the return pertains

4. Aggregate turnover of the taxpayer in the previous Financial Year. This information would be submitted by the taxpayers only in the first year, first tax period and will be auto-populated in subsequent tax periods and years.

5. The transactions of outward supplies are required to be furnished in the said Statement i.e., Form GSTR 1 at an invoice / consolidated level, as per the requirements laid down in law / rules which are as mentioned in the below table:

Table 1: Submission of information at Invoice level.

Table 2: Submission of information at consolidated (Place of supply) level.

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Note: For all B2C supplies (whether inter-State or intra-State) where invoice value is up to ` 2, 50,000/- State-wise and rate-wise summary of supplies should be uploaded in Table 7 of the Form GSTR-1.

Additional Comments: Every registered person furnishing any statement or return or making any application, shall make sure that they have read the instructions provided by GSTN which is to be followed by every registered person furnishing such statement / return / application. The said instruction is available in the format(s) of Form(s) prescribed in CGST Rules, 2017 as well as at the offline utility of each of the Statement / Return / Application.

Illustration:

  1. HSN requirement: HSN summary to be provided in Table 12 of Form GSTR 1 is divided into three parts i.e., (a) every registered person with annual turnover above ` 1.5 Crore but below ` 5 Crore in the preceding FY, is required to furnish details of supply HSN wise at least at 2 digit level; (b) person with annual turnover above ` 5 Crore is required to provide details of outward supplies at 4 digit level; and (c) supplier not falling under (a) or (b) above, is required to provide details of goods supplied at the level of description of goods supplied.

Further, Unit Quantity Code (UQC) for which no specific unit of measurement is available, shall be selected as ‘OTHERS’ for example in case of supply of services, UQC can be on the basis of number of invoices issued under particular HSN for a particular tax period.

It is also important to note that, HSN Summary or summary of supplies at description of goods / services level, shall also contain details of supplies which are exempt from payment of tax or is not liable to Goods and Service Tax i.e., non-taxable supply (example supply of alcoholic liquor meant for human consumption).

  •  Furnishing of details of Physical Exports as against supplies made to SEZ unit or SEZ developer / Deemed Exports: Details of Physical export of goods or services or both are to be separately furnished in Table 6A of Form GSTR 1.

Comparative Review

Under all the earlier laws, which is been subsumed into GST, there was no concept of furnishing a statement of outward supplies for the purpose of matching outward supplies with the input tax credit availed by the recipient of such supply. However, VAT laws of few States such as Karnataka had the facility of e-UPaSS which was introduced with the intent of matching output tax paid by the seller with that of input tax credit availed. However, the said activity was never carried out even as part of assessment under respective State VAT Laws.

Issues and Concerns

  • It is important for every registered person to note that the details of all outward supplies made by him is to be furnished in Form GSTR 1 i.e., statement of outward supplies, irrespective of the fact, whether such supply is outside the umbrella of GST or exempted from payment of tax i.e., GST, by way of exemption notification or is it a supply of notified goods or services which is liable to tax in the hands of recipient. The reason for disclosure is (1) the law requires one to provide details of such supplies though not liable to tax; and (2) as a registered person, by disclosing the values of all supplies, the registered person is effecting a reconciliation of financial statements with that of statements / returns furnished.
  • Person effecting zero-rated supplies (physical export of goods), who wishes to claim refund of taxes paid has to ensure that details relating to such supplies as provided in GSTR 1, like invoice no., shipping bill details, value of goods exported and amount of IGST paid match with the details as available in the ICEGATE system. Only on matching of such details, refund of tax paid will be granted. Therefore, it is important that every registered person making physical export of goods verifies whether details of all export invoices as provided in GSTR 1 matches with details available in customs in ICEGATE.

The same can be verified by logging in to www.gst.gov.in with valid credentials and following the below mentioned steps:

Refunds >> Track Status of Invoice data to be shared with ICEGATE

Note: If the difference in the value of IGST paid is more than ` 100, between values disclosed in Form GTSR 3B and that of Form GSTR 1, the information will not be shared by GSTN for verification by ICEGATE, in such cases one has to first ensure that there is parity in the value disclosed in Form GSTR 3B and Form GSTR 1 by amending the details as required.

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