(Vigyan Bhawan, New Delhi)

Summary of Points Finalized in the Meeting

1. Approval of Draft Central Goods and Services Tax (CGST) Law

The Council approved the revised draft of the CGST Law as vetted by the Ministry of Law & Justice, incorporating modifications suggested in the officers’ meeting held on 3 March 2017.

Key amendments and decisions included:

Cross-empowerment of officers:

SGST officers will be empowered under the CGST Act, ensuring only one order for one dispute covering both CGST and SGST.

If a CGST officer passes an order including SGST demand, the SGST officer shall be barred from issuing a separate order on the same issue.

Interest rates for delayed refund:

6% interest for general delayed refunds.

9% interest if refund not issued within 30 days after adjudication or appellate order attaining finality.

Tax collection at source (TCS) by e-commerce operators:

Rate to be “up to 1%” (0.5% each under CGST and SGST), instead of a fixed 1%.

Gift exemption:

Employer gifts up to ₹50,000 per financial year to employees not treated as supply.

Single-member Appellate Tribunal benches:

May consist of either a Technical or Judicial Member (not only Judicial).

Refund and pre-deposit provisions:

No change in appellate deposit structure (10% at first appeal, 20% at second appeal).

Reference correction:

In Section 54(12), “Section 50” replaced with “Section 56” for clarity.

Provision for Jammu & Kashmir:

References to Indian laws (e.g., IPC, CrPC) to include corresponding State laws of J&K where applicable.

Uniform definition alignment:

“Works contract” definition aligned between Clause 6 of Schedule II and Section 2(118).

Deletion and clarification:

Services by foreign diplomatic missions and UN bodies removed from Schedule III — to be handled via separate notification.

Decision to retain sale of land and building as neither goods nor services; matter to be revisited after one year of GST implementation.

Advance Ruling Authority:

To be constituted under State Acts with general uniformity, but no national-level ruling binding across states.

2. Approval of Draft Integrated Goods and Services Tax (IGST) Law

The Council approved the revised draft IGST Law with modifications, emphasizing simplification and uniformity across India.

Key amendments finalised:

Cross-empowerment between Centre and States reflected for smooth dual control.

Export and SEZ supplies:

Declared zero-rated; SEZ supplies treated at par with exports.

SEZ suppliers eligible for input tax refunds.

Transfer of input tax credit:

Mechanism clarified for transfer between States when supply classification changes (inter-state ↔ intra-state).

Dispute handling:

Law Committee authorised to fix drafting inconsistencies and align legal references.

3. Decision on e-Way Bill Development

The Council approved Goods and Services Tax Network (GSTN) to develop a nationwide e-Way Bill system.

Key features:

Mandatory for movement of goods above threshold value (to be prescribed).

Implementation to ensure real-time tracking, transparency, and reduction in physical check-posts.

States to integrate transport systems for seamless operation across borders.

4. Uniform Treatment of SEZs and Cross-Jurisdictional Issues

The Council agreed on uniform treatment of Special Economic Zones (SEZs) under the IGST Act.

Supplies to SEZs are zero-rated, ensuring full refund of input taxes.

Jurisdictional clarity: Both Central and State officers may be assigned, with oversight decided by the Council.

5. Next Meeting of the GST Council

The next (12th) meeting was scheduled for 16 March 2017 in New Delhi to finalise the SGST, UTGST, and Compensation Laws.

Key Outcome:
The 11th GST Council Meeting marked a major breakthrough — approval of the CGST and IGST draft laws with final language and structure, paving the way for legislative passage in Parliament and State Assemblies. It also finalized the TCS mechanism, refund interest rates, cross-empowerment principles, and e-Way Bill development, bringing GST implementation one step closer to the planned 1 July 2017 rollout.