Summary of Points Finalized in the Meeting

Ratification of Notifications, Circulars and Orders
The Council ratified notifications, circulars, and orders issued by the Central Government under GST laws and similar notifications issued by States and Union Territories since the previous Council meeting. 42nd GST Council Minutes, page 4

GST Compensation to States for FY 2020–21
The Council decided that the Government of India would borrow ₹1.1 lakh crore under the special window facility to meet the shortfall in GST compensation arising out of GST implementation and pass it on to the States as a back-to-back loan. 42nd GST Council Minutes, pages 6–8

Enhancement of Borrowing Limit (FRBM)
The Council supported the proposal that States opting for Option 1 (special window borrowing) would also be eligible for an additional 0.5% borrowing under the FRBM Act. 42nd GST Council Minutes, page 8

Release of Compensation Cess Collections
The Council approved the release of ₹20,000 crore from the Compensation Cess Fund to States for loss of revenue during 2020–21. 42nd GST Council Minutes, page 9

Extension of GST Compensation Cess beyond June 2022
It was decided that the levy of Compensation Cess would continue beyond June 2022 to repay the principal and interest on the borrowed amount. 42nd GST Council Minutes, page 9

Exemption from GST on Satellite Launch Services by ISRO, Antrix and NSIL
The Council approved the proposal to exempt satellite launch services provided by ISRO, Antrix Corporation and NSIL from GST. 42nd GST Council Minutes, page 11

Cess on Exports to Continue Until Full Recovery of Loans
The Council clarified that the compensation cess would continue to be levied on luxury and sin goods until full repayment of the borrowings (principal and interest) was completed. 42nd GST Council Minutes, page 12

Apportionment of IGST Balance for FY 2017–18
The Council approved the apportionment of ₹24,000 crore of unsettled IGST balance for FY 2017–18 between the Centre and States on a provisional basis (50:50). 42nd GST Council Minutes, page 13

Levy of Compensation Cess on Pan Masala, Tobacco, and Coal
The Council reviewed the levy and decided to maintain the existing cess rates on these products while ensuring appropriate compliance mechanisms were in place. 42nd GST Council Minutes, page 14

Due Date Extension for GSTR-1 and GSTR-3B Filings
The Council approved extension of due dates for filing GSTR-1 and GSTR-3B for small taxpayers (turnover up to ₹5 crore) for specified months in 2020 due to the pandemic. 42nd GST Council Minutes, page 15

QRMP Scheme (Quarterly Return Monthly Payment)
The Council approved the launch of QRMP scheme from 1st January 2021, allowing taxpayers with turnover up to ₹5 crore to file quarterly GSTR-3B returns with monthly tax payments through a simple challan. 42nd GST Council Minutes, pages 16–17

Auto-Population of GSTR-3B from GSTR-1 and 2B
Approved the auto-population of GSTR-3B returns using data from GSTR-1 (outward supplies) and GSTR-2B (input tax credit), aimed at simplifying compliance. 42nd GST Council Minutes, page 17

Refund Disbursement through Single Authority
The Council approved a proposal for single disbursement authority for all GST refunds (Central and State portions) to streamline refund processing. 42nd GST Council Minutes, page 18

Simplification of HSN/SAC Reporting

6-digit HSN code mandatory for taxpayers with turnover above ₹5 crore.

4-digit HSN code for those below ₹5 crore.
This applied from 1st April 2021. 42nd GST Council Minutes, page 19

Revised Late Fee Structure
Rationalized late fee structure to ensure fairness and reduce compliance burden, especially for small taxpayers. 42nd GST Council Minutes, page 20

Ad-hoc Exemptions for COVID-19 Medical Supplies
Council noted exemptions under Section 25(2) of the Customs Act for critical COVID-19 relief imports and extended the validity of such exemptions. 42nd GST Council Minutes, page 21