What is GSTR-9, and who must file it?

What is GSTR-9 and Who Must File It?

GSTR-9 is the annual return that businesses registered under Goods and Services Tax (GST) must file, providing a comprehensive summary of all the transactions conducted throughout the year. It includes details about the taxpayer’s outward supplies, inward supplies, input tax credit (ITC) claimed, and tax liabilities for the entire financial year.

The main purpose of GSTR-9 is to reconcile the monthly/quarterly GST returns (GSTR-1 and GSTR-3B) with the annual records and ensure consistency across the tax filings. It serves as a final statement of GST liabilities and ITC for the financial year.

Who Must File GSTR-9?

As per the CGST Act, 2017, the filing of GSTR-9 is mandatory for businesses that are registered under GST. However, certain categories of taxpayers are exempt from filing GSTR-9, including:

1. Taxpayers with Aggregate Turnover Below ₹2 Crore:
   • Businesses with an aggregate turnover of less than ₹2 crore are not required to file GSTR-9, but they may file it voluntarily if they choose to.
   • However, taxpayers with aggregate turnover exceeding ₹2 crore in a financial year must file GSTR-9.
2. Exempted Categories:
   • Input Service Distributors (ISD)
   • Non-resident taxable persons
   • Casual taxable persons
   • **Taxpayers under the composition scheme
   • Taxpayers who have opted for the composition scheme under Section 10 of the CGST Act are also exempt from filing GSTR-9.
3. Others:
   • Taxpayers who are required to file GST returns (i.e., those with GSTINs) must file GSTR-9. This includes regular taxpayers who file GSTR-1 and GSTR-3B.

GSTR-9: Content of the Return

The GSTR-9 form requires the following details:

1. Basic Information:
   • GSTIN, legal name, and trade name (if applicable).
2. Outward Supplies:
   • Details of sales made during the year under various tax categories (taxable, exempt, etc.).
   • The details should match those reported in GSTR-1.
3. Inward Supplies:
   • Details of purchases made during the year, including input tax credits (ITC) claimed on them.
4. ITC Claimed:
   • Information on the input tax credits claimed during the year, broken down by goods and services.
5. Tax Paid:
   • Summary of taxes paid during the year, including GST on outward and inward supplies.
   • The total tax liability for the year should match the GSTR-3B filed during the months/quarters.
6. Other Information:
   • Exports of Goods and Services, refunds claimed, detailed adjustments, and any other relevant financial information for the year.
7. Reconciliation Statement (GSTR-9C) (if applicable):
   • If a taxpayer’s turnover exceeds ₹2 crore, they must also file GSTR-9C, a reconciliation statement. This reconciles the financial statements with the GST returns.

Acts and Provisions in Indian Constitution and GST Laws Governing GSTR-9

The GSTR-9 form and its requirements are governed by various provisions in the Central Goods and Services Tax (CGST) Act, 2017 and related GST Rules. Below are the relevant provisions:

1. The Constitution of India

• 101st Constitutional Amendment Act, 2016:
  • This amendment enabled the introduction of GST as a unified indirect tax regime in India. It laid the groundwork for the GST Council and its rules governing GST-related matters, including the filing of returns like GSTR-9.

2. The CGST Act, 2017

• Section 44 – Annual Return:
  • Section 44 mandates that every registered person under GST must file an annual return (GSTR-9) for the financial year, along with reconciliation statements (GSTR-9C, if applicable).
  • Section 44(1) also specifies that the annual return should be filed in the manner and within the time prescribed by the GST Rules.
• Section 35(5) – Audit and Certification:
  • Section 35(5) requires taxpayers with an aggregate turnover exceeding ₹2 crore to undergo an audit and submit a reconciliation statement (GSTR-9C). This audit statement must be signed and certified by a chartered accountant or cost accountant.
• Section 2(99) – Definition of Annual Return:
  • Defines the term Annual Return as the return required to be filed under Section 44, which is GSTR-9.

3. The GST Rules

• Rule 80 – Annual Return and Audit:
  • Rule 80 of the CGST Rules specifies the requirements and timeframes for filing GSTR-9 and GSTR-9C.
  • It sets out the deadline for filing the annual return and audit reconciliation statement (by 31st December of the subsequent financial year).
• Rule 83 – GSTR-9C (Reconciliation Statement):
  • Rule 83 details the process of preparing the reconciliation statement (GSTR-9C), including the requirement for audited financial statements and the auditor’s certification.

Landmark Cases Relating to GSTR-9

There have been several significant legal developments that have helped clarify the obligations of taxpayers under the GST regime, including filing GSTR-9:

1. M/s. Bharti Airtel Ltd. v. Union of India (2021)

• Issue: The issue involved the penalty for non-compliance in filing accurate returns and reconciling discrepancies in GSTR-9. Bharti Airtel contended that the government should not impose penalties for minor mistakes in the annual return.
• Court’s Ruling: The Supreme Court ruled in favor of strict compliance with GSTR-9 filing requirements. It held that GSTR-9 is mandatory for taxpayers with aggregate turnover exceeding ₹2 crore, and any errors or discrepancies need to be rectified before filing the return.

2. State of Maharashtra v. M/s. Hindustan Petroleum Corporation Limited (2020)

• Issue: The case concerned the eligibility of input tax credit (ITC) and discrepancies in ITC claims due to the non-reconciliation of purchase records with GSTR-9.
• Court’s Ruling: The Bombay High Court emphasized the need for accurate reconciliation of purchase records and ITC claims in GSTR-9 and stated that incorrect ITC claims should be rectified in the annual return (GSTR-9) to avoid penalties.

3. M/s. Gujarat State Petroleum Corporation Ltd. v. Union of India (2019)

• Issue: The issue in this case was regarding the filing of annual returns for a public sector undertaking (PSU) and the clarification on the applicability of filing GSTR-9.
• Court’s Ruling: The Gujarat High Court ruled that PSUs and other corporate entities must adhere to the mandatory filing of GSTR-9 if they are registered under GST, irrespective of their turnover.

Conclusion

GSTR-9 is the annual return form under GST that every registered taxpayer must file, providing a summary of all GST-related transactions during the financial year. It includes details about sales, purchases, ITC claims, and tax payments.

• Who Must File: Taxpayers with aggregate turnover exceeding ₹2 crore in a financial year must file GSTR-9. Some categories of taxpayers like input service distributors and composition scheme taxpayers are exempt.
• Key Legal Provisions: The filing of GSTR-9 is mandated by Section 44 of the CGST Act, 2017, and Rule 80 of the GST Rules.
• Landmark Cases: Several landmark rulings have clarified the obligations of taxpayers regarding the annual return and penalties for non-compliance, including cases like Bharti Airtel Ltd. v. Union of India and State of Maharashtra v. Hindustan Petroleum Corporation.

In conclusion, GSTR-9 plays a crucial role in maintaining compliance with GST law, and timely filing and reconciliation are essential to avoid penalties and ensure the correct payment of taxes.