Chapter 7 GST Practitioners, Authorised Representative, Professional Opportunities – CS Professional Advance Tax Law Notes is designed strictly as per the latest syllabus and exam pattern.
GST Practitioners, Authorised Representative, Professional Opportunities – CS Professional Advance Tax Law Study Material
Question 1.
The proceedings under the CGST Act, 2017 before the authorities including the Appellate Tribunal can be attended by the “Authorized Representative”. Explain who can act as an authorized representative under the Act. (Dec 2017, 5 marks)
Answer:
“Authorised Representative” shall mean a person authorised by the person referred to in sub-section (1) to appear on his behalf, being:
(a) his relative or regular employee; or
(b) an advocate who is entitled topractice in any Court in India, and who has not been debarred from practicing before any Court in India; or
(c) any Chartered Accountant, a Cost Accountant or a Company Secretary, who holds a certificate of practice and who has not been debarred from practice; or
(d) a retired Officer of the Commercial Tax Department of any State Government or Union Territory or of the Board who, during his service under the Government, had worked in a post not below the rank than that of a Group-B Gazetted Officer for a period of not less than two years:
Provided that such Officer shall not be entitled to appear before any proceedings under this Act for a period of one year from the date of his retirement or resignation; or
(e) any person who has been authorised to act as a goods and services tax practitioner on behalf of the concerned registered person.
Question 2.
Write a short note on “Compliance Rating”.
Answer:
Compliance Rating in GST seeks to bring transparency to the entire GST compliances and administration by way of assigning compliance ratings. In general, the concept of GST compliance rating is akin to a performance
ranking / scale for all registered taxable persons based on their record of compliance with the provisions of the GST Act which tells how compliant they are with respect to the GST provisions.
This will be irrespective of nature, size, or turnover of the business of all registered taxable persons. The idea behind this concept of tax administration is to compel people to be fully GST compliant and on time with uploading invoices in relation to with or without ITC and other necessary documents.
For example, a rating system may be devised on a scale of 1 to 10, with 10 being the highest compliant and ‘1’ being least compliant. If one person files his / her returns on time or pay its taxes on time, there is a greater probability that he / she will be rewarded with the higher rating as compared to those who are not compliant and punctual in following the rules, regulations and time limits. Please note that the actual rating system has still not been notified by the Government.
Question 3.
Describe the criteria ¡n GST Compliance Rating.
Answer:
Criteria for Compliance Rating
The following diagram depicts the important factors which will form basis for Compliance rating:
- Making Payments on Time
- Matching / Reconciliation of transactions
- Filing Returns in Time
- Cooperation with the Authorities
- Adherence to various time limits
Question 4.
What are the major benefits / objectives of compliance rating?
Answer:
The following are the major benefits / objectives of compliance rating:
Efficient input tax credit mechanism: A person can claim an input tax credit in GSTR-2 (return with purchase details for the month) only when the seller also files his GSTR-1 (return with monthly sales details), and the details on both these forms reconcile or match with each other. This was not so earlier.
The rating of a taxable person would be relevant to determine the eligibility of input tax credit in respect of inward supplies, selection for scrutiny and other administrative/monitoring purposes. The rating would be based on tax payer’s record of compliance with the provisions of CGST, SGST and IGST. The details of parameters and methodology for rating would be prescribed.
Preferred supplier chosen by buyers / Increase customer base: As compliance rating increases, so is customer base, in accordance with rating and reputation. The buyer will prefer to choose those suppliers whose rating is good in the market.
Will ensure healthy competition and enhanced compliances: The objective of this concept of tax administration is to make people fully GST compliant and on time with the uploading of invoices and other necessary documents, which will ensure healthy cometition in the market.
Lower or poor rating may attract strictor scrutiny and surveillance: If rules and regulations are regularly followed, then the chances of business coming under the spotlight or scrutiny of the GST authorities are significantly reduced, as the need to audit accounts will be nil.
Question 5.
What is the eligibility criteria for becoming GST practitioner?
Answer:
Eligibility Criteria for becoming GST practitioner
Any person can apply for registration as a GST Practitioner under Rule 83(1) of CGST Act 2017, if he qualifies as per following criteria:
- Citizen of India
- Person of sound mind
- Not adjudicated as insolvent
- Not been convicted by court
Further, the person eligible as above should also satisfy any one or more of the following conditions:
- is a retired officer of the Commercial Tax Department of any State Government or of the CBEC and has worked in a post not lower in rank than that of a Group-B gazetted officer for a period of not less than two years, or
- has been enrolled as a sales tax practitioner or tax return preparer under the existing law for a period of not less than 5 years, or
- has passed any of the following examinations, namely:
- final examination of the Institute of Chartered Accountants of India, or
- final examination of the Institute of Cost and Works Accountants of India, or
Question 6.
What are the functions of a Goods & Services Tax Practitioner?
Answer:
A Goods and Services Tax Practitioner can undertake any or all of the following activities on behalf of a registered person, if so authorized by him as shown below:
- furnish the details of outward and inward supplies
- furnish monthly, quarterly, annual or final return
- make deposit for credit into the electronic cash ledger
- file a claim for refund
- file an application for amendment or cancellation of registration
Question 7.
Explain the difference between Authorized Representative and GST Practitioner.
Answer:
Distinction between Authorized Representative and GST Practitioner
| Basis | Authorised Representative | GST Practitioner |
| Meaning | An authorised representative means a person who is authorised by a person to appear on his behalf for any proceedings under GST law before Appellate authority. | GST Practitioner is a tax professional who can prepare returns and perform other activities on behalf of the person whom he is representing |
| Scope of work | Authorised representative can appear before any Appellate Authority/ Tribunal. | GST practitioner can be authorised for purposes like furnishing of returns, claiming refund, etc. and also for representation purposes. |
| Passing Examination |
There is no concept of examination for becoming an authorised representative | For becoming a GST practitioner, a person is required to clear the prescribed examination. |
| Role ’ | An Authorised representative can become a GST Practitioner subject passing out of prescribed examination. | Any GST practitioner can also act as an authorised representative also. |
GST Practitioners, Authorised Representative, Professional Opportunities Notes
Compliance Rating
Compliance Rating in GST seeks to bring transparency to the entire GST compliances and administration by way of assigning compliance ratings. All registered taxpayers will be publically rated according to how they comply with GST regulations. As per Section 149 of the CGST/SGST Act, every registered person shall be assigned a compliance rating based on the record of compliance in respect of specified parameters. Such ratings shall also be placed in the public domain. A prospective client will be able to see the compliance ratings of suppliers and take a decision as to whether to deal with a particular supplier or not. This will create healthy competition amongst taxable persons.
Working of Compliance Rating
According to Section 149(3) of the CGST Act, 2017, the compliance rating score in GST shall be updated periodically. The same shall be intimated to the taxable person and also placed in the public domain, in the manner prescribed. However, the parameters, criteria and methodology have not been notified yet, but it is expected that compliance rating scores may be based on following:
- timely payment of taxes,
- timely e-filing of monthly/quarterly returns,
- matching of transactions,
- adherence to various time limits,
- co-operation in dealing with tax Department etc.
- filing of regular and annual returns timely and correctly
- correct utilization of input tax credit and its disclosure
- correct deduction of TDS/TCS, wherever applicable
- findings in scrutiny of returns/audit findings
- refund claims etc.
Benefits of Compliance Rating
- Reputation built up
- Preferences/privileges by the Department (not known now)
- May be used by banks/suppliers as a bench mark
- Will facilitate better negotiation with suppliers
- Add to good governance aspects of organization
- Speedy refunds
Impact of Compliance Rating
Correct and timely input tax credit
↓
Enhanced Trust and reputation amongst the business community
↓
Increase customer base of business entities
↓
Reduced costs due to better negotiation
↓
Chances of scrutiny / audits reduced
↓
Good Corporate Governance
Constitution of the Standing Committee and Screening Committees [Rule 123]
- The Council may constitute a Standing Committee on Anti-profiteering which shall consist of such officers of the State Government and Central Government as may be nominated by it.
- A State level Screening Committee shall be constituted in each State by the State Governments which shall consist of-
- one officer of the State Government, to be nominated by the Commissioner, and
- one officer of the Central Government, to be nominated by the Chief Commissioner.
Objectives of anti-profiteering measure in GST
The objectives of the anti-profiteering provision can be enumerated as under:
- If there is reduction in rate of tax on the supply of goods or services or
- Benefit of input tax credit is now available under GST
Then, a registered person must pass on the benefit by reduction in prices to the consumer, i.e., anti-profiteering measure would obligate the businesses to pass on the cost benefit arising out of GST implementation to their customers.
Duties of Anti-Profiteering Authority (APA) [Rule 127]
Section 171(2) of the GST Act read with rule 127 CGST Rules, 2017, APA is duty bound to:
- determine whether any reduction in rate of tax on any supply of goods or services or the benefit of the input tax credit has been passed on to the recipient by way of commensurate reduction in prices.
- identity the registered persons taxpayers who has not passed on the benefits.
- pass an appropriate order
- to furnish a performance report to the Council by the tenth day of the close of each quarter.
The intention is to make it sure that whatever tax benefits are allowed, the benefit of that reaches to the ultimate customers and is not pocketed by trade.
Functions of Anti-profiteering Authority
The Authority under section 171 of the GST Act shall have the following monitoring functions:
- Input tax credit availed by taxpayer have actually resulted in commensurate reduction in price of goods/services.
- The reduction in prices on account of reduction in tax rates have actually resulted ¡n a commensurate reduction in price of goods/services.
Duties of National anti-profiteering authority (Chairman and Technical Members)
Shall pass orders within 3 months of re’eiving the report from Directorate General (DG) Anti-profiteering.
Duties of Director General Anti-profiteering
Shall conduct investigations and collect necessary evidence and within 3 months of receipt of reference, submit a report of findings to the NAA
Duties of Standing Committee (Constituted on GST Council Recommendations)
Shall examine applications received from interested parties or Commissioner or any other person and ascertain if evidence submitted is sufficient for it to be a fit case for investigation. It shall then refer the case to DG Anti-profiteering within 2 months.
Duties of State level screening committee
Shall examine applications involving local issues and forward it to the Standing Committee with recommendation if it deems it fit.
Orders to be issued by Authority [Rule 133(3)]
Order may be for any of the following:
- Reduction in prices
- Returning to the buyer, the benefit amount not passed along with 18 percent interest. Period of interest will be calculated from the date of collection of higher amount till the date of return of such amount.
- Depositing money in customer welfare fund in case the customer does not claim it or is not identifiable. Interest will be calculated from the date collection of higher amount till the date it is deposited in the Fund.
- Imposition of penalty equivalent to the amount involved of undue profiteering
- Cancellation of registration.
Note: The Authority will pass order within 3 months from the date of the receipt of the report from the Director General of Anti-profiteering. An opportunity of being heard will be given if the interested parties request for it in writing.
GST Practitioner (GSTP)
GST Practitioner is a Goods and Services Tax professional under CGST Act, who can prepare returns and perform other activities on the basis of the information furnished to him by a Registered Person.
Meaning of Authorised Representative
An authorised representative means a person who is authorised by a person to appear bn his behalf for any proceedings under GST law before Appellate authority.
Authorized Representatives
- Company Secretary
- Chartered Accountant
- Cost Accountant