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Credit of unsold stock [Section 140(3)] – Actual Credit as well as Notional Credit – Part-I – GST Transitional provisions

Goods and Services Tax – GST – By: – Sanjay Kumawat – Dated:- 25-5-2017 Last Replied Date:- 23-3-2018 – Central Levies Q. Whether a person can claim a credit for taxes paid in relation to goods lying in the stock where such person is having taxpaying documents? Ans. As per section 140(3) of CGST Act, 2017, a registered person under GST who was- not liable to be registered under the existing law, or engaged in the manufacture of exempted goods or provision of exempted services, or providing works contract service and was availing of the benefit of notification No. 26/2012-Service Tax, dated 20.06.2012, or a first stage dealer or a second stage dealer, or a registered importer, or a depot of a manufacturer can claim a credit of eligible duties paid in relation to goods lying in stock or semi-finished goods or finished goods held in stock on appointed date. Q. What are the eligible duties for which credit can be taken? Ans. Following are the eligible duties for which credit can be claime

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nd Service Tax is not covered under the category of eligible duty. Therefore, a person cannot claim a credit of CST as well as Service Tax. Q. Whether credit in relation to input services and capital goods can be claimed? Ans. As per section 140(3) of the CGST Act, 2017, credits in relation to inputs only can be claimed. Accordingly, credits in relation to input services and capital goods cannot be claimed. Q. What is the meaning of input', input services and capital goods ? Ans. The meaning of aforesaid terms is as follows: As per section 2(59) of CGST Act, 2017, input means any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business. As per section 2(60) of CGST Act, 2017, input service means any service used or intended to be used by a supplier in the course or furtherance of business. As per section 2(19) of CGST Act, 2017, capital goods means goods, the value of which is capitalized in the books of account of the person

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r prescribed documents were issued not earlier than twelve months immediately preceding the appointed day, and the supplier of services is not eligible for any abatement under the Act. Notional Credit- @40% Q. Whether a person can claim a credit for taxes paid in relation to goods lying in the stock where such person is not having taxpaying documents? Ans. As per proviso to section 140(3) of CGST Act, 2017 read with Rule 1 (3) of the Transition Rules, 2017, a registered person under GST who was not liable to be registered under the existing law can claim credit of eligible duties paid in relation to goods lying in stock on appointed date. It may be noted that the credits in relation to semi-finished or finished goods held in stock are not available in this case. It may further be noted that the person, not having taxpaying document, cannot claim credit in the following situations where such person was- engaged in the manufacture of exempted goods or provision of exempted services, or p

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uments, are as follows: the National Calamity Contingent Duty leviable under section 136 of the Finance Act, 2001(14 of 2001) the additional duty leviable under sub-section (1) of section 3 of the Customs Tariff Act, 1975 (51 of 1975); the additional duty leviable under sub-section (5) of section 3 of the Customs Tariff Act, 1975 (51 of 1975). Q. Whether credit in relation to input services and capital goods can be claimed? Ans. As per Rule 1 (3) of the Transition Rules, 2017, credits in relation to inputs only can be claimed. Accordingly, credits in relation to input services and capital goods cannot be claimed. Q. What will be the eligible credit amount that a person can claim in a case where a person is not having taxpaying documents? Ans. If a registered person is not having taxpaying documents (like tax invoice, bill of entry etc.) then a person can claim the credit equivalent to the 40% of CGST paid on the supply of such unsold stock. For example, a person is having a stock worth

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(2) of rule 1, submits a statement in FORM GST TRAN at the end of each of the six tax periods during which the scheme is in operation indicating therein the details of supplies of such goods effected during the tax period. The amount of credit allowed shall be credited to the electronic credit ledger of the applicant maintained in FORM GST PMT-2 on the Common Portal. The stock of goods on which the credit is availed is so stored that it can be easily identified by the registered person. Q. Whether a service provider or manufacturer can avail this scheme? Ans. No. As per proviso to section 140(3) of CGST Act, 2017, only a trader can avail this scheme. Part -II State levies……………………………………………………………………………………To be continued………….. – Reply By CA.Tarun Agarwalla – The Reply = In case a dealer of VAT having also a service tax registration for the rental output services. Can in this case proviso to section 140(3) still not a

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CAPITAL GOODS provided you have bills of inputs of last 12 months. As per sec 140(3) of CGST ACT, A registered person, who was not liable to be registered under the existing law, or who was engaged in the manufacture of exempted goods or provision of exempted services, or who was providing works contract service and was availing of the benefit of notification No. 26/2012-Service Tax, dated the 20th June, 2012 or a first stage dealer or a second stage dealer or a registered importer or a depot of a manufacturer, shall be entitled to take, in his electronic credit ledger, credit of eligible duties in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day subject to the following conditions, namely: such inputs or goods are used or intended to be used for making taxable supplies under this Act; the said registered person is eligible for input tax credit on such inputs under this Act; the said registered person is in posse

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proviso to section 140(3) still not avilable? Reply : In relation to services, you cannot claim the credit, as section 140(3) specifically says about the eligible duties and eligible duties does not include service tax. – Reply By CASANJAY AITHAN – The Reply = We are textile manufacturer.At present we have opted Central Excise exempted route and we are not charging excise duty for yarn sales and we have not claimed the Excise duty paid for our purchases so for . Also we have not mentioned our Excise duty portion in our ER1 Return.As per GST regime can we claim ITC of Excise duty for our Existing purchases available in the closing stock of Polyster. Viscose , Spares & Capital Goods as on 30.06.2017Please clarify. By: Arun kumar Dated: 28/06/2017 Reply : Yes, you can claim the 100% credit of excise on the basis of excise paying documents. If you dont have excise paying documents then you may claim 60/40 percent credit.It is to be noted that the you need to pass on the benefit of the

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r taking ITC, how to pass on the benefit to the customer.it should be in the form of Discount or decrease in selling price. – Reply By Amar P – The Reply = VAT dealer can get the credit of Excise duty paid on unsold stock which is specified in the tax invoice. But he is not registered under excise Act. – Reply By SHYAMSUNDER AGARWAL – The Reply = Dear Sir Sir We are cooler manufacturer have turnover less then 1.50 Crore, hence not registered under Excise. We have filled Tran-1 (Table-7A) and declared stock of input (Raw Material) like. cooler body, Fan Blade,Cartoon, Electric Motor as on 01.07.2017. Some of these raw material are used in manufacturing of cooler and some item has been sold as it. Now while filing Tran-2, which goods were sold directly without manufacturing of cooler, I have taken the value of goods sold at which it was sold at selling price. Now I am in confusion that some raw material are used in manufacturing of cooler, and cooler has been sold before 31.12.2017. now

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Short title, extent and commencement

Section 1 – GST – States – PRELIMINARY – Bihar Goods and Services Tax Act, 2017 – Act-Rules – [Bihar Act 12, 2017] THE BIHAR GOODS AND SERVICES TAX ACT, 2017 AN ACT to make a provision for levy and collection of tax on intra-State supply of goods or services or both by the State of Bihar and the matters connected therewith or incidental thereto BE it enacted by Legislature of Bihar in the Sixty-eighth Year of the Republic of India as follows:- CHAPTER I PREL

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Section 12(6) of CGST Act 2017 – Time of Supply linked with GSTR-1

Goods and Services Tax – GST – By: – Pradeep Jain – Dated:- 25-5-2017 – As per Section 12(6) of CGST Act, 2017 relating to Time of Supply of Goods states that time of supply to the extent it relates to an addition in the value of supply by way of interest, late fee or penalty for delayed payment of any consideration shall be the date on which the supplier receives such addition in value. This means that the tax is payable on interest received for delayed payment. This was not payable in current excise regime but the same will be payable in proposed GST regime. But this provision of time of supply has made the things more worse. The tax on such interest etc. is payable on the date of receipt of payment. But how the treatment of the same wil

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s such his liability to pay tax will arise in month itself. However, as per Section 12(6) the time of supply relating to debit note issued shall be date on which such amount is received by assessee, thus the supply falls in May 2018. Hence, the tax is payable in May 2018 only. But there is no mention of treatment in GSTR-1 return. The return will create liability in the month in which debit note is raised. Hence, there should be provision in return for the same. Moreover, it is written in terms and conditions that the payment should be made within a particular time and interest will be charges afterwards. But as trade practice, nobody ask for the interest on delayed payment. However, when the GST is payable on such interest, the department

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FOC sale under GST

Goods and Services Tax – Started By: – Swapneswar muduli – Dated:- 25-5-2017 Last Replied Date:- 30-5-2017 – Dear Sir,Under GST if sale our FG and Raw material to any one to any domestic person or any Export person.1) Under what documents we need to remove this material from factory.2) Whether charge GST in this Documents or not ?RegardsSwapnewar – Reply By MUKUND THAKKAR – The Reply = Provided for under Section 17(5)(h) – Where goods are lost, stolen, destroyed, written off, or disposed of as gifts or free samples, proportionate input tax credit should be reversed. please generate documents (invoice) and mark FOC on body of invoices for accounting purpose. This is my view. – Reply By PAWAN KUMAR – The Reply = Dear SirAs per my view,1- tax

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GST impact on Job Work

Goods and Services Tax – Started By: – Swapneswar muduli – Dated:- 25-5-2017 Last Replied Date:- 7-7-2017 – Dear Experts,We are a manufacturer and we send the input, intermediate parts, capital goods to the job worker for job work purpose and same material received back to our premises after job work. In this case.1) Under GSt on what documents we need send this material to Job Worker ?2) Whether we charge GST on that documents or not ?3) Job worker charge the GST on his job work charge invoice ?RegardsSwapneswar Muduli. – Reply By MUKUND THAKKAR – The Reply = Inputs removed by a Principal to a Job Worker s premises that are returned to the Principal within 6 months (or within an extended period of further 2 months) no tax shall be payable

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However, GST has been considered useful to every corner of the nation and also demanding around one lakh tax consultants as soon as possible. – Reply By Narendra Soni – The Reply = Ans 1 – Delivery Challan Ans 2 – Under GST Laws, your transaction shall not be taxable subject to condition, If inputs send that must be received back within 1 year and for capital goods 3 year. in case of jigs dies ect. no time limit. if the inputs and capital goods not received in the prescribed time period then time of supply will be the date of supply. Ans 3 – Yes, job worker will charge the GST on his invoice of job work subject to threshold limit of 20 lacs or 10 lacs as the case may beWritten by Sushil Bhardwaj – Reply By K. Senguttuvan – The Reply = I co

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Reply to show cause notice

Reply to show cause notice – GST RFD – 09 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 09 – FORM-GST-RFD-09 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Notice for rejection of application for refund

Notice for rejection of application for refund – GST RFD – 08 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 08 – FORM-GST-RFD-08 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Refund Sanction/Rejection Order

Refund Sanction/Rejection Order – GST RFD – 06 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 06 – FORM-GST-RFD-06 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Payment Advice

Payment Advice – GST RFD – 05 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 05 – FORM-GST-RFD-05 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Provisional Refund Order

Provisional Refund Order – GST RFD – 04 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 04 – FORM-GST-RFD-04 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Deficiency Memo

Deficiency Memo – GST RFD – 03 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 03 – FORM-GST-RFD-03 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Acknowledgment

Acknowledgment – GST RFD – 02 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 02 – FORM-GST-RFD-02 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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GST execution from July 1 a challenge for industry

Goods and Services Tax – GST – Dated:- 24-5-2017 – New Delhi, May 24 (PTI) – Implementing GST from July 1 will be a challenge for the industry and the government should consider relaxing penal provisions for a couple of quarters to help it comply with the new tax regime, Assocham said today. The government is working overtime to roll out the goods and services tax regime from July 1 and has held several workshops and seminars to familiarise traders and the industry about the new indirect taxation structure. Implementing GST from July 1 will definitely be a challenge for the industry… there could be people making genuine mistakes. I would say the department should be softer in the first quarter or two because it is going to be a learning

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GST Council may reconsider steep levy on hybrid cars next week

Goods and Services Tax – GST – Dated:- 24-5-2017 – New Delhi, May 24 (PTI) The GST Council may reconsider the proposed 43 per cent tax on hybrid cars at its meeting next week after the auto industry voiced disappointment over the steep rate hike. As per the tax slabs decided by the Council last week, the incidence of GST on mid and large-sized hybrid cars has been kept at the same level as passenger cars. Under the GST, the tax incidence on hybrid vehicles will go up to 43 per cent from the current level of effective tax rate of 30.3 per cent. The tax incidence on hybrid vehicle has gone up and we are reading about the concerns being shared by industry. The Council may take a re-look at it in its next meeting on June 3, a revenue departmen

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ize hybrid cars have been subject to 15 per cent cess – same as similar sized passenger cars. The official further said, the rates have been put up in public domain well before time so that the industry gets time to prepare for the Goods and Services Tax (GST) which will be rolled out from July 1. Concerns expressed by industry would be taken on board and any decision to change the tax rate would go back to the Council, the official said. At present, hybrid vehicles attract excise duty of 12.5 per cent, similar to the ones for entry level small cars such as Tata Nano or Maruti Alto. Even though they are exempt from infrastructure cess, there is a 1 per cent National Calamity Contingent Duty, 2 per cent Central Sales Tax and 12.5 per cent VA

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Application for Refund

Application for Refund – GST RFD – 01 – Final Rules (Draft) – Forms – GST – REFUND – Final Draft Rules 18-5-2017 – GST RFD – 01 – FORM-GST-RFD-01 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Form for Field Visit Report

Form for Field Visit Report – GST REG – 30 – Final Rules (Draft) – Forms – GST – REGISTRATION – Final Draft Rules 18-5-2017 – GST REG – 30 – Form GST REG-30 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Order for cancellation of provisional registration

Order for cancellation of provisional registration – GST REG – 28 – Final Rules (Draft) – Forms – GST – REGISTRATION – Final Draft Rules 18-5-2017 – GST REG – 28 – Form GST REG-28 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Application for Enrolment of Existing Taxpayer

Application for Enrolment of Existing Taxpayer – GST REG – 26 – Final Rules (Draft) – Forms – GST – REGISTRATION – Final Draft Rules 18-5-2017 – GST REG – 26 – Form GST REG-26 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Certificate of Provisional Registration

Certificate of Provisional Registration – GST REG – 25 – Final Rules (Draft) – Forms – GST – REGISTRATION – Final Draft Rules 18-5-2017 – GST REG – 25 – Form GST REG-25 – Statutory Provisions, Acts, Rules, Regulations, Taxation

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