Credit Transfer Document (CTD)
By: – CASanjay Kumawat
Goods and Services Tax – GST
Dated:- 27-6-2017
GST Council has recently issued draft rule for issue of Credit Transfer Document (CTD) to be inserted in the CENVAT Credit Rules, 2004 for transfer of Cenvat credit paid on specified goods available with a trader as on appointed date.
* A manufacturer who was registered under Central Excise Act, 1944 may issue a Credit Transfer Document to evidence payment of excise duty paid on goods manufactured and cleared by him before the date on which CGST Act, 2017 comes into force, under the cover of an invoice issued to a person who was not registered under the Central Excise Act, 1944 but is registered under the provisions of CGST Act, 2017.
Accordingly, a manufacturer may issue a document called as CTD for transfer of credit of excise duty to the person who is not registered person under Central Excise Act, 1944 but registered under GST Act, 2017.
* Transfer of credit of
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ereon.
The manufacturer is satisfied that the dealer to whom Credit Transfer Document is issued is in possession of such manufactured goods in the form in which it was cleared by him.
* Credit Transfer Document shall be issued within 30 days of the appointed date on which CGST Act, 2017 comes into force and copy of the corresponding invoices shall be enclosed with the Credit Transfer Document.
* Copies of all invoices relating to buying and selling from manufacturer to the dealer, through intermediate dealers, is maintained by the dealer availing credit using CTDs.
Accordingly, dealer has to maintain all the invoices relating to buying and selling from manufacturer through intermediate dealers, i.e.,
* Invoice issued by the manufacture specifying the item details
* Invoices issued by the main dealer specifying the item details
* CTD shall not be issued in favour of a dealer to whom invoice was issued for the same goods before the appointed date.
CTD to be issued only to t
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ed (third party) as invoice is available with the XYZ Limited is only for VAT purposes. It cannot claim the credit of the excise duty. Therefore, on the basis of CTD, it can claim the credit of Excise Duty and that to the extent of 100%.
* A dealer availing credit using Credit Transfer Document on manufactured goods shall not be eligible to avail credit under provision of rule 1(4) of Transition Rules made under CGST Act, 2017 on identical goods manufactured by the same manufacturer available in the stock of the dealer.
* Rule 1(4) of Transition Rules made under CGST Act, 2017 provides availment of credit on notional basis @60%( goods rate is more than 9%) / 40% of CGST paid where a registered person is not having tax paying document of Excise Duty.
* Once a person has availed the credit of excise duty by using CTD then such person cannot claim the credit on notional basis again.
* The dealer availing credit on the basis of Credit Transfer Document shall , at the time of makin
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