KERALA STATE ELECTRICITY BOARD LIMITED (Inorporated under the Indian Companies At, 1956) OFFICE OF THE SECRETARY (ADMN) VYDYUTHI BHAVANAM, PATTOM, THIRUVANANTHAPURAM - 695 004 No. FA/Tax Cell/GST/2017-18 Dated: 20/06/2017 CIRCULAR Sub:- GST implementation Ations to be taken in ase of existing ontrats reg. Ref:- Provisions of IGST At 2017 and CGST At 2017. The Government of India is planning to implement Goods and Servies Tax (GST) with effet from 01/07/2017, whih would replae the indiret taxes being levied by Central and State Governments, like Central Exise duty, Additional Duties of Customs (ommonly known as CVD), Speial Additional Duty of Customs (SAD), Servie Tax, State VAT, Central Sales Tax, et. Field offies are requesting for larifiation on the ations to be taken in ase of existing work or purhase orders, before implementation of GST with effet from 01/07/2017. With referene to the above, the provisions of GST (as of now), related to timing of supply of goods and servies are reprodued below: Setion 12: Time of supply (Goods): As per Setion 12(1) of CGST At 2017, the liability to pay tax on goods shall arise at the time of supply, as determined in aordane with the provisions of this setion. As per Setion 12(2), the time of supply of goods shall be the earlier of the following dates, namely: (a) the date of issue of invoie by the supplier or the last date on whih he is required, under the provisions of sub-setion (1) of setion 31 (30 days), to issue the invoie with respet to the supply; or the date on whih the supplier reeives the payment with respet to the supply. Setion 12(3): Reverse Charge (Supply of Goods): In ase of supplies in respet of whih tax is paid or liable to be paid on reverse harge basis, the time of supply shall be the earliest of the following dates, namely: GST_Cirular_22453.do 1
(a) () the date of the reeipt of goods; or the date of payment as entered in the books of aount of the reipient or the date on whih the payment is debited in his bank aount, whihever is earlier; or the date immediately following thirty days from the date of issue of invoie or any other doument, by whatever name alled, in lieu thereof by the supplier: Provided that where it is not possible to determine the time of supply under lause (a) or lause or lause (), the time of supply shall be the date of entry in the books of aount of the reipient of supply. Setion 13: Time of supply (Servies): As per Setion 13(1) of CGST At 2017, the liability to pay tax on servies shall arise at the time of supply, as determined in aordane with the provisions of this setion. As per Setion 13(2), the time of supply of servies shall be the earliest of the following dates, namely: (a) () the date of issue of invoie by the supplier, if the invoie is issued within the period presribed under sub-setion (2) of setion 31 or the date of reeipt of payment, whihever is earlier; or the date of provision of servie, if the invoie is not issued within the period presribed under sub-setion (2) of setion 31 or the date of reeipt of payment, whihever is earlier; or the date on whih the reipient shows the reeipt of servies in his books of aount, in a ase where the provisions of lause (a) or lause do not apply Setion 13(3): Reverse Charge (Supply of Servies): In ase of supplies in respet of whih tax is paid or liable to be paid on reverse harge basis, the time of supply shall be the earlier of the following dates, namely: (a) the date of payment as entered in the books of aount of the reipient or the date on whih the payment is debited in his bank aount, whihever is earlier; or the date immediately following sixty days from the date of issue of invoie or any other doument, by whatever name alled, in lieu thereof by the supplier. Provided that where it is not possible to determine the time of supply under lause (a) or lause, the time of supply shall be the date of entry in the books of aount of the reipient of supply. GST_Cirular_22453.do 2
As per the above provisions, in ase of ontrats awarded before GST, provisions of GST will be appliable only if, the all stages like servie/supply, Invoie and Payment are effeted post-gst. Detailed statement showing the timing of the stages and appliable tax laws are given below: Situation Servie/supply Invoie Payment Pre-GST Post-GST Pre-GST Post-GST Pre-GST Post-GST Tax appliable I Yes Yes Yes Existing II Yes Yes Yes Existing III Yes Yes Yes Existing IV Yes Yes Yes Existing V Yes Yes Yes Existing VI Yes Yes Yes Existing VII Yes Yes Yes Existing VIII Yes Yes Yes GST Illustrations: a) KSEBL has entered into ontrat with M/s ABC Limited for onstrution of sub-station on 1 st June 2017. i) ii) iii) iv) ABC Ltd has supplied part of the materials on 15 th June 2017 and reeived payment thereof on 29 th June 2017. No GST will be appliable as the supply was before 1 st July 2017. ABC Ltd has supplied materials on 20 th June 2017 and issued an Invoie for it on 20 th June. Payment is made on 27 th July. GST will not apply as the supply was made before GST implementation. ABC Ltd supplies goods on 15 th July 2017. GST will apply on this as supply was after GST rollout, even though the ontrat was signed before GST. KSEBL paid advane for supply of goods or servies, on 20 th June 2017 and ABC Ltd has raised Invoie for the same. ABC Ltd supplied the materials on 5 th July. GST_Cirular_22453.do 3
GST will not apply as the time of supply (as per Setion 12 or 13) is before 1 st July 2017. b) KSEBL has entered into seurity servies ontrat for 3 months with M/s KEXCON on 1 st June 2017. The payment has to be made on monthly basis. i) ii) Invoie for June 2017 is prepared on 30 th June 2017. Payment is effeted on 7 th July 2017. GST will not be appliable as the time of supply is 30 th June. Invoie for June 2017 is prepared on 1 st July 2017. Payment is effeted on 7 th July 2017. GST will be appliable as the time of supply is 1 st July 2017. Ations to be taken on implementation of GST: Purhase of Goods: 1. It has to be ensured that, for supplies reeived on or before 30 th June 2017, Invoies are issued and GRN prepared on or before 30 th June 2017 itself. Work Contrat or Servie Contrats: 1. All ontrats ompleted before 30 th June 2017 has to be measured and aounted on or before 30 th June 2017. 2. In ase of ontinuing ontrats, like shift operator servies, seurity servies, et., Invoies for the month of June has to be prepared and measured on or before 30 th June 2017 and aounted in June 2017 itself. Purhase of Goods or reeipt of servie from unregistered ontrators: As per Setion 9(4) of CGST At, the entral tax in respet of the supply of taxable goods or servies or both by a supplier, who is not registered, to a registered person shall be paid by suh person on reverse harge basis as the reipient and all the provisions of this At shall apply to suh reipient as if he is the person liable for paying the tax in relation to the supply of suh goods or servies or both. Wherever, KSEBL is making any purhase or availing any servies from an unregistered ontrator, the liability to pay appliable GST on the goods or servies reeived, is on KSEBL. While aepting or evaluating tenders or quotations for purhase or servies, additional GST liability on aount of the above has to be onsidered. GST_Cirular_22453.do 4
Illustration: Tender for AMC of Computers is invited. The prie to be quoted should be all inlusive. ABC Ltd, registered ontrator, quoted for `10,000/-. XYZ, unregistered ontrator, quoted for `9,000/-. Effetive ost to KSEBL on aount of ontrat with XYZ, being an unregistered ontrator, will be `10,620/- (i.e., `9,000 + GST @ 18% - `1,620/-). Thus, lowest quote will be by ABC Ltd. Updating of GSTIN of suppliers of goods or servies All the ARUs have to update their SARAS database by entering the Provisional Id or GSTIN of the suppliers and ontrators. RITU is in the proess of updating the SARAS software for inorporating the requirements under the GST Regime. Thus, all ARUs have to ollet opy of the Registration Aknowledgement ontaining the Provisional Id or GSTIN from all ontrators. Quoting of GST Registration number on Invoies reeived: With effet from 01 st July 2017, whenever supplier of goods or servies levies GST on supplies to KSEBL, it has to be ensured that the Invoie is prepared in the name of Kerala State Eletriity Board Limited and the GST Number (Provisional Id or GSTIN) of KSEBL is mentioned in the Invoie. Provisional Id of KSEBL is 32AAECK2277NBZ1. One the GSTIN is allotted to KSEBL, the same will be intimated to all field offies. Sd/- SECRETARY (ADMINISTRATION) To All ARUs and Offies of KSEBL GST_Cirular_22453.do 5