SKP Group
SKP GST Update
GST Rollout - Key GST Rules Amended

The GST Council in its meeting on 11 June 2017 has taken the following decisions with respect to the accounts and records and registration Rules:

Accounts and records rules
  • The draft accounts and records rules have been approved by the Council after making some important revisions taking into consideration the representations received from various stakeholders.
  • A comparative summary of the key revisions is given below:
Sr no Earlier Draft Rule Amendment Effect of Amendment
  1.  
A registered person was required to maintain separate books of accounts for each activity viz. manufacturing, trading and provision of services, etc. This provision has been deleted. A registered person should not be required to maintain separate books of accounts for each activity including manufacturing, trading and provision of services, etc.
  1.  
A registered person was required to maintain commodity-wise details like opening balance, receipt, supply, goods lost, etc. of commodities supplied and received by him. This provision has been amended by replacing the phrase ’each commodity’ with the word ’goods’. An overall record of details in respect of the goods should be a sufficient compliance.
  1.  
A registered person supplying services is required to maintain quantitative details of goods used in the provision of each service. This provision has been amended by deleting the word ’each the A registered person is required to maintain details of goods used in the provision of services as a whole, and not for each service individually.
  1.  
A registered person executing works contract is required to keep separate accounts for each works contract. This provision has been amended by deleting the word ’each'. A registered person is required to maintain such accounts for all works contracts together, and not for each work contract individually.
  1.  
A registered person is required to maintain particulars of name and complete addresses of suppliers from whom he has received goods or services. This provision has been amended by adding the phrase ‘goods or services chargeable to tax under the Act’ at the end. The details mentioned will be needed to be maintained only when the goods or services received are chargeable to tax under the GST regime.
  1.  
A registered person was required to keep books of account at the principal place of business and at every related place(s) of business mentioned in his certificate of registration. A registered person is required to keep books of account at the principal place of business and books of account relating to additional place of business mentioned in his certificate of registration. It appears that instead of maintenance of records at each additional place of business, the requirement is only that the records should be accessible at each place of business.
  1.  
Any entry in the register, accounts or documents of a registered person cannot be erased, effaced or overwritten. The entry needs to be scored out under attestation and then the correct entry can be recorded. The scope of this provision has been reduced by inserting the phrase ’otherwise than those of clerical nature’. The procedure of scoring out under attestation of incorrect entries need not be followed if such a mistake is of a clerical nature.
  1.  
A registered person is required to serially number each volume of books of account. The phrase ’maintained manually’ has been inserted. A registered person is required to serially number each volume of only those books of account which are maintained manually.
  1.  
A registered person is required to provide, on demand, an account of the audit trail and inter-linkages including the source document, whether paper or electronic and the financial accounts, record layout, data dictionary and explanation for codes used and the total number of records in each field along with sample copies of documents. The provision has been substituted with a new provision. A registered person, who stores accounts and records electronically, is required to provide, on demand, the details of such files, passwords of such files where necessary for access and any other information which is required for such access along with sample copy in print form of the information stored in such files.
  1.  
A person engaged in the business of transporting goods is required to maintain records of goods transported, delivered and goods stored in transit by him and for each of his branches. The phrase ’along with GSTIN of the registered consignor and consignee’ has been inserted. The transporter is now required to maintain records of GSTIN of the registered consignor and consignee.
 
  • The format of Form GST ENR-01 under the accounts and records rules has been released for application for enrollment of unregistered persons under Section 35(2) of the CGST Act. The form can be accessed here.
Registration rules
  • The draft registration rules have been approved by the Council after making some revisions as follows:
    • The certificate of registration granted under sub-Rule (1) of Rule 3 of registration rules shall be duly signed. The alternative of verifying it through Electronic Verification Code (EVC) has been removed.
    • The alternative of verifying applications, replies to notices, returns, etc. under these rules through, inter alia, Aadhar based electronic verification code, has been removed.
    • All notices, certificates and orders under these rules are to be issued electronically by the proper officer or any other officer authorised to issue such notices or certificates or orders. Such officer can now issue it through e-signature as specified under the Information Technology Act, 2000.
  • Exemption from registration
    • In pursuance of the powers granted under Section 23(2) of the CGST Act, 2017, the GST Council has recommended exemption from registration to the following persons:
      • Individual advocates (including senior advocates).
      • Individual sponsorship service providers (including players).

 [PRT1]Please give the full form here
SKP's comments
  • It appears that the GST Council has endeavoured to rationalise the Accounts and Records and Registration Rules taking into consideration the bona fide concerns of the industry by amending the onerous requirements present in the erstwhile draft rules.
  • With the continuous fine-tuning of rules even in the face of fast approaching go-live date, it appears that the amendment in various rules and formats may be a continuous and dynamic process. However, the stakeholders are also looking forward to the certainty of provisions with the objective of stabilising their IT systems.
SKP
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This update contains general information which is provided on an “as is” basis without warranties of any kind, express or implied and is not intended to address any particular situation. The information contained herein may not be comprehensive and should not be construed as specific advice or opinion. This update should not be substituted for any professional advice or service, and it should not be acted or relied upon or used as a basis for any decision or action that may affect you or your business. It is also expressly clarified that this update is not intended to be a form of solicitation or invitation or advertisement to create any adviser-client relationship.

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