Service Tenders

17th Jun 2016

Service Tenders :

The Government intends to implement GST wef 01.07.2017
To be ensured that all suppliers are registered under GST & GSTIN registration number submitted along with tender
If existing dealers, to be confirmed for migration to GSTIN & GSTIN registration number
If the supplier is below the threshold limit, viz Rs.20. lacs as per existing provisions, then a declaration to be obtained to that effect along with copy of accounts confirming that the supplier is below the threshold limit, failing which the supplier will be treated as an Unregistered dealer (URD) for which tax is payable on reverse charge (RCM) by BHEL.
If the supplier is above the threshold & is yet not registered, GST is payable by BHEL on reverse charge basis.
Under GST, the Government has linked every service to a service accounting code called SAC. The list of services and the corresponding service accounting code (SAC) is released by Govt & available in public domain. All registered suppliers submitting the quote shall mandatorily mention SAC code relevant for the service quoted.
The rate of tax applicable for 35 services is also released by Government and rate for any service not falling in the list of 35 services is 18% . To be ensured that rates are quoted as per the service for which quoted & SAC is mapped
PO should be released along with HSN code & SAC code, which has to be mentioned in the invoice submitted subsequently
Invoice should contain all particulars as per invoice Rules and should include the GST registration number (GSTIN) , service accounting code (SAC) apart from all other details mentioned. The invoice details & sample invoice format is uploaded in IDT webpage
In case GST is payable on reverse charge (RCM) invoice should mention that tax is payable on reverse charge
For a registered supplier, the supplier uploaded sales data for the month will be available to recipient on 11th of the subsequent month & details can be verified by BHEL. Credit availment can be confirmed based on this verified data
If the Supplier is not registered, then tax is payable on Reverse charge & will be to the account of the supplier
All services in the course of business or furtherance of business are eligible to credit subject to other compliances listed herein.
If service is eligible for credit, then the credit can be availed only if the invoice is as per the prescribed format, the supplier has uploaded the invoice in the GSTN portal, paid the taxes & uploaded the return, and matches with our inward data, failing which any availment of credit attracts interest.
Even is case of services where credit is not eligible,

(i) either the supplier should have registered (if above threshold limit) & comply with all above statutory provisions relating to invoice, tax remittance, return filing etc. This can be verified by BHEL from the GSTN portal OR

(ii) if not registered BHEL shall be liable to pay applicable taxes on reverse charge

For any deficiency in services, where a recovery is made / adjusted in supplier bills, the supplier has to raise a credit note on BHEL & upload in GSTN portal. All above rules applicable for invoice also apply for credit note.

17th Jun 2016

Goods Tenders :

The Government intends to implement GST wef 01.07.2017
To be ensured that all suppliers are registered under GST & GSTIN registration number submitted along with tender
If existing dealers, to be confirmed for migration to GSTIN & GSTIN registration number
If the supplier is below the threshold limit, viz Rs.20. lacs as per existing provisions, then a declaration to be obtained to that effect along with copy of accounts confirming that the supplier is below the threshold limit, failing which the supplier will be treated as an Unregistered dealer (URD) for which tax is payable on reverse charge (RCM) by BHEL.
If the supplier is above the threshold & is yet not registered, GST is payable by BHEL on reverse charge basis.
All goods are linked to HSN code (Harmonised System Nomenclature). This goods list mapped with HSN code is released by Govt & available in public domain. All registered suppliers submitting the quote shall mandatorily mention HSN code relevant for the goods quoted.
The rate of tax applicable for all the above goods is also released by Government and available in public domain. To be ensured that rates are quoted as per the Goods / HSN code which is quoted.
PO should be released along with HSN code, which has to be mentioned in all the invoices submitted subsequently
Invoice should contain all particulars as per invoice Rules and should include the GST registration number (GSTIN) , HSN code apart from all other details mentioned. The invoice details & sample invoice format is uploaded in IDT webpage
In case GST is payable on reverse charge (RCM) invoice should mention that tax is payable on reverse charge
For a registered supplier, the supplier uploaded sales data for the month will be available to recipient on 11th of the subsequent month & details can be verified by BHEL. Credit availment can be confirmed based on this verified data. Hence PO to include this condition relating this compliance.
If the Supplier is not registered, then tax is payable on Reverse charge & will be to the account of the supplier
All goods procured in the course of business or furtherance of business are eligible to credit subject to other compliances listed herein.
If eligible for credit, then the credit can be availed only if the invoice is as per the prescribed format, the supplier has uploaded the invoice in the GSTN portal, paid the taxes & uploaded the return, and matches with our inward data, failing which any availment of credit attracts interest. Hence PO to include condition for ensuring matching of supplier uploaded data with BHEL inward / purchase data.

Even is case where credit is not eligible,

(iii) either the supplier should have registered (if above threshold limit) & comply with all above statutory provisions relating to invoice, tax remittance, return filing etc. This can be verified by BHEL from the GSTN portal OR

(iv) if not registered BHEL shall be liable to pay applicable taxes on reverse charge

For any deficiency in supply, where a recovery is made / adjusted in supplier bills, the supplier has to raise a credit note on BHEL & upload in GSTN portal. All above rules applicable for invoice also apply for credit note. PO to contain this condition for compliance.

GST Transition – Action points for Transition period / Caution points

The below guidelines are compiled for immediate action during the transition period, based on the Laws, Rules & provisions as applicable as on date.

Registration :

(i) Ensure all procurements / services / transactions are only from registered manufacturers / dealers / service tax providers / VAT dealers, as existing registered dealers would have migrated to GSTIN & may have been allotted GSTIN numbers.

(ii) Ensure all POs released after 15th Jun 2017 only to vendors who have been allotted GSTIN numbers. In such cases, Please ensure that the GSTIN is mapped in vendor master

HSN Mapping :

Ensure all POs released after 15th Jul 2017 are mapped to HSN codes as per GST Law & PO to contain clause that HSN code is mandatory in all invoices

Credit availment :

(i) Review any missed out eligible cenvat credits within one year & ensure availment by 30th Jun 2017, failing which credit will be lost.

(ii) Any doubtful / uncertain credit wrt credit eligibility, option to pay “under protest “ may be examined to ensure credit is not lost in post GST regime

Reverse Charge :

(i) All reverse charge liability to be paid by 30th Jun 2017 otherwise credit wherever eligible will not be available to BHEL. Please take up with vendors / concerned departments to ensure that all RCM bills are submitted & service tax remitted by 30th Jun 2017.

(ii) Payment to service providers pending for more than 3 months to be reviewed for payment as window for re-availment of credit is only for 3 months from 1st Jul 2017

GRs upto 30th Jun 2017 :

(i) All goods received as on 30th Jun 2017 – all invoices eligible for Excise duty credit to be ensured that it is submitted to IDT Section latest by 7th Jul 2017 for availment of credit when the return is filed on 10th of July 2017. Unless it is included in this last pre GST return, the eligible credit of Excise duty cannot be availed.

(ii) Any invoice with Excise duty which is dated before 1st Jul 2017, but invoice received after the above date, credit is LOST.

(iii) In case of sales tax, VAT credit cannot be availed unless it is included in the VAT return to be filed on 20th Jul 2017. Hence all invoices with VAT credit should reach IDT section latest by 17th Jul 2017

(iv) C / F / H forms can be issued only if the invoices are accounted as purchases on 30th Jun 2017, included in the VAT return to be filed on 20th Jul 2017. Hence all invoices to be received & accounted as purchases & informed to IDT section for uploading in the last pre-GST return to be filed on 20th Jul 2017.

Goods in transit :

Invoices dated before 1s Jul 2017 but goods received on or after 1st Jul 2017, 30 day time limit is allowed for availing the credit, failing which the credit is LOST to BHEL.

Job works :

Goods sent on job works & not returned, (for which 180 days is already lapsed) & is pending with JW beyond 180 days, to be reviewed for bringing back. Under GST there is no provision for re-availing the credit that is already reversed. This credit is permanently lost if not returned before 1st jul 2017

Rejections :

All Rejections which have not yet been taken back by the supplier, if removed after 1st Jul 2017 will have GST implications, which will be to the account of the supplier. Supplier to be informed to remove such rejected items from our factory before 1st Jul 2017.

The above provisions to be informed to all vendors to ensure the submission of invoices in time, credit availment without aby Loss, issue of concessional Forms wherever applicable.

Kindly ensure compliance of above guidelines to ensure smooth transition to GST wef 1st Jul 2017.

Dated : 14 Jun 2017