Goods and Services Tax – GST – By: – Pradeep Jain – Dated:- 2-1-2017 – GST DAILY DOSE OF UPDATION BY CA PRADEEP JAIN TRANSITIONAL PROVISIONS-PART-V SECTION 171 CREDIT OF ELIGIBLE DUTIES AND TAXES IN RESPECT OF INPUTS OR INPUT SERVICES DURING TRANSIT This is a new provision that has been incorporated in the revised GST law which provides for credit availment for inputs/input services during transit. Where the goods have been removed prior to the appointed day on payment of excise/VAT but are received after the appointed day, then the question of availment of cenvat of excise and VAT against CGST/SGST will arise. To resolve this situation, following has been provided:- (1) A registered taxable person shall be entitled to take, in his electro
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(1). If we minutely observe the above provisions, we find that these enable credit availment for inputs/input services that are in transit on the appointed day. The example of input services in transit can be the services of transportation of goods by road/rail. At this point, it is pertinent to note the provisions contained in section 188 of the Revised GST law which states that tax in respect of taxable services shall be payable under earlier law to the extent the point of taxation in respect of such services arose before the appointed day. Say for example, if the transportation of goods by road service has been booked in advance for which invoice has been issued before the appointed day and payment is also made before the appointed day,
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but there is no provision in revised GST law for enabling assessees to avail the credit of capital goods in transit. Consequently, the assessees should ensure that they receive the capital goods before the appointed day if ordered before the appointed day or place order for capital goods only after implementation of GST so that there is no issue regarding availment of credit of excise duty/VAT. The above provision also specifies that the credit will be allowed only if the invoice is booked in the accounts within 30 days of the appointed day. Not only this, assessee is also required to file a statement with the authorities to substantiate the credit taken on the goods in transit. You may visit us at www.capradeepjain.com https://www.faceboo
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