Sections 52, 54, 79, 107 and 112 of the CGST Amendment Act, 2018
The Central Goods and Services Tax (Amendment) Act, 2018 amended several important provisions of the Central Goods and Services Tax Act, 2017. This article explains the amendments relating to Section 52 (collection of tax at source), Section 54 (refund), Section 79 (recovery), Section 107 (appeal to the Appellate Authority) and Section 112 (appeal to the Appellate Tribunal).
Amendment of Section 52 of the CGST Act
What does Section 52 deal with?
Section 52 of the CGST Act deals with collection of tax at source (TCS) by electronic commerce operators. Subject to the statutory conditions, an electronic commerce operator is required to collect tax on the net value of taxable supplies made through the operator where the consideration is collected by the operator.
Amendment made by the CGST Amendment Act, 2018
In Section 52 of the principal Act, in sub-section (9), for the words and figures "section 37", the words and figures "section 37 or section 39" were substituted.
The amendment expanded the statutory cross-reference in Section 52(9). The provision concerning discrepancies in details furnished by an electronic commerce operator was therefore linked not only with Section 37 but also with Section 39.
Section 37 principally concerns details of outward supplies, while Section 39 deals with furnishing of returns. The amendment aligned the TCS reconciliation mechanism with the GST return framework.
Amendment of Section 54 of the CGST Act
What does Section 54 deal with?
Section 54 contains the principal statutory provisions governing refund of tax, interest and other amounts under GST. It also deals with refund of unutilised input tax credit in cases permitted by the Act.
Changes introduced in 2018
In Section 54 of the principal Act, in sub-section (8), clause (a), the expressions relating to "zero-rated supplies" were amended by substituting references to "export" and "exports", as applicable.
In Explanation (2), clause (c), item (i), after the words "foreign exchange", the words "or in Indian rupees wherever permitted by the Reserve Bank of India" were inserted.
The relevant date provision for refund of unutilised input tax credit under clause (ii) of the first proviso to Section 54(3) was also substituted with reference to the due date for furnishing the return under Section 39 for the period in which the refund claim arises.
Why was the amendment important?
One significant change recognised receipt of export proceeds in Indian rupees where such receipt is permitted by the Reserve Bank of India. This avoided restricting the statutory refund provision solely to cases where consideration was received in convertible foreign exchange.
The amendment also clarified the relevant date for specified refund claims involving unutilised input tax credit by linking it with the due date for furnishing the return under Section 39.
Amendment of Section 79 of the CGST Act
What does Section 79 deal with?
Section 79 provides statutory machinery for recovery of amounts payable under the CGST Act. Subject to the Act, the proper officer may use the modes of recovery specified in the section for recovering unpaid amounts.
Explanation inserted by the 2018 Amendment Act
After Section 79(4), an Explanation was inserted providing that, for the purposes of Section 79, the word "person" includes "distinct persons" referred to in Section 25(4) or Section 25(5), as the case may be.
Meaning of distinct persons
Under Section 25 of the CGST Act, separate registrations of the same legal person can, in the circumstances specified by the Act, be treated as registrations of distinct persons. The Explanation inserted in Section 79 is therefore relevant to the statutory recovery mechanism where the taxable person has multiple GST registrations treated as distinct persons.
Amendment of Section 107 - Appeal to Appellate Authority
What does Section 107 provide?
Section 107 governs an appeal to the GST Appellate Authority against a decision or order passed by an adjudicating authority under the CGST Act, SGST Act or UTGST Act, subject to the statutory conditions and limitation period.
2018 amendment to the pre-deposit ceiling
In Section 107(6)(b), after the words "arising from the said order,", the words "subject to a maximum of twenty-five crore rupees," were inserted.
The 2018 amendment therefore introduced a monetary ceiling of Rs. 25 crore on the pre-deposit contemplated by Section 107(6)(b).
Section 107 has also undergone subsequent amendments. In particular, the current provision contains a specific pre-deposit requirement for an appeal against an order demanding penalty without involving a demand of tax. Accordingly, the current consolidated statutory text should be checked before filing an appeal.
Amendment of Section 112 - Appeal to the GST Appellate Tribunal
What does Section 112 deal with?
Section 112 governs appeals to the Goods and Services Tax Appellate Tribunal against eligible orders passed under Section 107 or Section 108, subject to the conditions, limitation periods and pre-deposit requirements prescribed by the CGST Act.
2018 amendment
In Section 112(8)(b), after the words "arising from the said order,", the words "subject to a maximum of fifty crore rupees," were inserted.
Accordingly, the 2018 Amendment Act originally introduced a maximum ceiling of Rs. 50 crore for the additional statutory pre-deposit under Section 112(8)(b).
2018 Amendment vs Current Position
| Section | Subject | 2018 Amendment | Current relevance |
|---|---|---|---|
| 52 | TCS by e-commerce operators | Section 39 reference added to Section 52(9) | Forms part of the statutory TCS and return reconciliation framework |
| 54 | Refunds | Changes concerning exports, permitted receipt in Indian rupees and relevant date | Read with the current consolidated refund provisions and applicable rules |
| 79 | Recovery | Distinct persons included for recovery purposes | Important where the same person has registrations treated as distinct persons |
| 107 | First appeal | Rs. 25 crore maximum inserted | Maximum subsequently reduced to Rs. 20 crore |
| 112 | Tribunal appeal | Rs. 50 crore maximum inserted | Current additional pre-deposit is 10%, subject to maximum Rs. 20 crore |
Effective Date of the 2018 Amendments
The amendments discussed on this page were brought into force from 1 February 2019. Later amendments to the CGST Act must, however, be considered when determining the law applicable to a present-day transaction, proceeding, refund, recovery or appeal.
Official Legal Resources
For the authoritative statutory text and subsequent amendments, readers should verify the latest consolidated legislation from official Government sources: