Skip to main content

Cos Fear Losing Credit Over GST Filing Errors

Cos Fear Losing Credit Over GST Filing Errors
Industry bats for extension of filing deadline citing delay in getting offline utility
A company with Rs.100 crore credit in lieu of taxes paid in the past regime, risks losing it now under the goods and services tax (GST) reign simply because of the `fat finger,' as it is popularly called.
With the August 28 (Monday) deadline looming for filing returns and ensuring GST compliance, corporates are a deeply concerned lot. The offline utility for GST TRAN 1 form to be used to claim input tax credit for the pre-GST regime -was not available till Sunday , leaving just a day for filing returns and causing a weekend rush.
In absence of the utility, details had to be filed online with higher chances of error. Tax practioners struggled to meet the deadline, having had to deploy additional manpower to manually key in invoices, some running into thousands.
What has compounded the industry's worry is that there is no clarity on whether TRAN 1 can be revised later for any inadvertent human error (or fat finger) due to manual entry or will it simply mean losing tax credit.
This has led to a clamour for another extension of the deadline or a provision allowing amending of the form later. The government had already extended the deadline once for those seeking to claim transitional credit from the past regime from August 20 to August 28, following industry representations.
An offline utility allows entry of details, careful scrutiny and subsequent submission, reducing chances of errors while online filing may lead to fat finger errors.
One company ET is aware of has already made errors in filing online and is worried about losing its accumulated input credit.
Taxpayers are required to provide all details separately -invoice-wise or challan-wise. These can pertain to claim of Cenvat or value added tax credit on capital goods, details of stocks at job workers' premises, concessional rate of central sales tax claimed under the previous regime and claims where invoices were not received till June 30.
In some companies, these details would run into thousands of lines of items, where each line would need to be punched manually in the specified field in the online forms. Further, TRAN 1 (and consequently, all such details) is to be submitted for each jurisdiction where the entity has registration. Absence of the offline utility thus becomes a significant issue.
The GSTN, an official said, is working overtime to ensure that all IT requirements with regard to compliance are met.
The industry, however, has already demanded a tech audit of the GST Network. The Confederation of All India Traders last week asked the government to order a tech audit of GSTN in the wake of filing issues. Another official said the government is keeping a close watch on the situation.
Tax experts are pitching for pushing forward the compliance calendar.
“Problems in filing TRAN 1 returns due to absence of (offline) utility is compounded by inadvertent errors made in filing, with no recourse or visibility of a change in the returns...The compliance calendar should be pushed forward to allow GSTN to be fully ready with its software,“ said Bipin Sapra, partner, EY.
“Without any utility on GSTN for filing TRAN 1, companies have to manually punch thousands of invoice and other details on the portal. It is both time-consuming and error-prone. Also, there is confusion as to whether TRAN 1 can be revised later (or not),“ said Pratik Jain, indirect tax leader, PricewaterhouseCoopers.
Jain said the industry would hope for an extension of the timeline for filing TRAN 1 once the utility is in place and an immediate clarification that it can be revised at least till September 30.
MS Mani, senior director, Deloitte Haskins & Sells LLP, pointed out that service providers are equally hit.“Several businesses that had filed their service tax returns by August 15 and thereafter realised they are required to revise the service tax returns are now in a quandary.“
The Economic Times, New Delhi, 28th August 2017


Popular posts from this blog

RBI rushes in to prop up falling rupee

RBI rushes in to prop up falling rupee India’s central bank reportedly intervened in the currency markets on Monday to prevent a further slide in the local unit, which breached the 67 mark to a dollar for the first time in 15 months amid a widening trade gap and runaway import bills fuelled by high crude-oil prices. Some state-owned banks were seen selling dollars aggressively, interventions that market dealers attributed to the central bank’s strategy to stem the decline of the Indian rupee against the US currency. The rupee is the worst performing among a dozen Asian monetary units in the past three months. It lost 4.25 per cent to the dollar during the period, show data from Bloomberg. On Monday, the Reserve Bank of India (RBI) is said to have sold about Rs 800 million collectively on the spot and exchange traded futures markets, dealers said. An email sent to RBI remained unanswered until the publication of this report. The currency market has seen such a strong central bank interven…

GST Refund of Rs 20,000 Cr Pending: Exporters’ Body

GST Refund of Rs  20,000 Cr Pending: Exporters’ Body Refund of over Rs 20,000 crore on account of Goods and Services Tax (GST) is pending with the government with more than half the amount stuck as input tax credit, Federation of Indian Export Organisations said on Tuesday. While claims over Rs7,000 crore were cleared in March, the amount was Rs 1,000 crore in April.However, after exporters’ request, the GST council and tax department are organizing a second phase of Special Refund Fortnight starting May 31, which will enable exporters to draw their refunds at a speedy pace. Many exporters have been unable to file the refund of input tax credit due to technical glitches, exports and claim happened in different months. The major challenge lies on ITC refund especially because the process is partly electronic and partly manual which is cumbersome and add to the transaction cost, the exporters’ body said. On IGST, refunds are getting delayed due to airline and shipping companies not submitt…

Shrinking footprints of foreign banks in India

Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…