Karnataka Goods and Services Tax (Amendment) Act, 2022

Sep 16, 2022 | by TeamLease RegTech Legal Research Team

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Finance & Taxation ComplianceThe Government of Karnataka on September 15, 2022, issued the Karnataka Goods and Services Tax (Amendment) Act, 2022 to further amend the Karnataka Goods and Services Tax Act, 2017. 

The following amendments have been made:

• The Section 38 of the Karnataka Goods and Services Tax Act, 2017, the following section has been substituted, namely:

“38. Communication of details of inward supplies and input tax credit.- 

• The details of outward supplies furnished by the registered persons under subsection (1) of section 37 and of such other supplies as may be prescribed, and an autogenerated statement containing the details of input tax credit shall be made available electronically to the recipients of such supplies in such form and manner, within such time, and subject to such conditions and restrictions as may be prescribed. 

• The auto-generated statement under sub-section (1) shall consist of- (a)details of inward supplies in respect of which credit of input tax may be available to the recipient; and (b)details of supplies in respect of which such credit cannot be availed, whether wholly or partly, by the recipient, on account of the details of the said supplies being furnished under sub-section (1) of section 37,- 

o by any registered person within such period of taking registration as may be prescribed; or 

o by any registered person, who has defaulted in payment of tax and where such default has continued for such period as may be prescribed; or 

o by any registered person, the output tax payable by whom in accordance with the statement of outward supplies furnished by him under the said sub-section during such period, as may be prescribed, exceeds the output tax paid by him during the said period by such limit as may be prescribed; or 

o by any registered person who, during such period as may be prescribed, has availed credit of input tax of an amount that exceeds the credit that can be availed by him in accordance with clause (a), by such limit as may be prescribed; or

o by any registered person, who has defaulted in discharging his tax liability in accordance with the provisions of sub-section (12) of section 49 subject to such conditions and restrictions as may be prescribed; or 

o by such other class of persons as may be prescribed.”

• In section 39 of the Karnataka Goods and Services Tax Act, 2017, in sub-section (7), for the first proviso, the following proviso has been substituted, namely:-

“Provided that every registered person furnishing return under the proviso to sub-section (1) shall pay to the Government, in such form and manner, and within such time, as may be prescribed,- 

o an amount equal to the tax due taking into account inward and outward supplies of goods or services or both, input tax credit availed, tax payable and such other particulars during a month; or 

o in lieu of the amount referred to in clause (a), an amount determined in such manner and subject to such conditions and restrictions as may be prescribed.”; 

o in sub-section (9),- (i) for the words and figures “Subject to the provisions of sections 37 and 38, if”, the word “Where” shall be substituted; (ii) in the proviso, for the words “the due date for furnishing of return for the month of September or second quarter”, the words “the thirtieth day of November” shall be substituted; 

o in sub-section (10), for the words “has not been furnished by him”, the following shall be substituted, namely:-  “or the details of outward supplies under sub-section (1) of section 37 for the said tax period has not been furnished by him: 

Provided that the Government may, on the recommendations of the Council, by notification, subject to such conditions and restrictions as may be specified therein, allow a registered person or a class of registered persons to furnish the return, even if he has not furnished the returns for one or more previous tax periods or has not furnished the details of outward supplies under sub-section (1) of section 37 for the said tax period.”.

• The section 41 of the Karnataka Goods and Services Tax Act, 2017, the following section has been substituted, namely:-

“41. Availment of input tax credit.- 

o Every registered person shall, subject to such conditions and restrictions as may be prescribed, be entitled to avail the credit of eligible input tax, as self-assessed, in his return and such amount shall be credited to his electronic credit ledger. 

o The credit of input tax availed by a registered person under sub-section (1) in respect of such supplies of goods or services or both, the tax payable whereon has not been paid by the supplier, shall be reversed along with applicable interest, by the said person in such manner as may be prescribed: Provided that where the said supplier makes payment of the tax payable in respect of the aforesaid supplies, the said registered person may re-avail the amount of credit reversed by him in such manner as may be prescribed.”

• In section 50 of the Karnataka Goods and Services Tax Act, 2017, for sub-section (3), the following sub-section has been substituted and shall be deemed to have been substituted with effect from the 1st day of July, 2017, namely:- 

“(3) Where the input tax credit has been wrongly availed and utilised, the registered person shall pay interest on such input tax credit wrongly availed and utilised, at such rate not exceeding twenty-four per cent. as may be notified by the Government, on the recommendations of the Council, and the interest shall be calculated, in such manner as may be prescribed.”

The provisions of this Act shall come into force on such date as the Government may, by notification in the Official Gazette, appoint.

Disclaimer – Please refer to the notification for further amendments provided in the Link/Document. 

[LA Bill No. 19 of 2022]


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