Goods and Service Tax-transition relief –scenario and Guidelines-Issuance of certain instructions – Reg.
CCT’s Ref No. A(1)/72/2017 Dated:- 24-6-2017 Telangana SGST
GST – States
Office of the
Commissioner of Commercial Taxes
Telangana State :: Hyderabad
CCT's Ref No. A(1)/72/2017, Dt.24-06-2017
Sri V. Anil Kumar, I.A.S., Commissioner (CT)
Circular
GST-Transitional Relief – Certain Guidelines
Sub:- Goods and Service Tax-transition relief -scenario and Guidelines-Issuance of certain instructions – Reg.
Ref: – Chapter 20 of the State Goods and Service tax Act, 2017.
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Attention is invited to the subject and the reference cited. It is to inform that Government of India has already announced the introduction of Goods and Service tax from 1st July, 2017. In this regard GST Act, 2017 has stipulated certain provisions for providing transition relief to the dealers. The provisions pertaining to transition relief are as per section 139, 140, 141 and 142 of the Telangan
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also eligible for transitional credit on the goods held in stock which have already suffered tax.
v. If the above mentioned dealers possess taxpaying document like tax invoice or excise challan they are eligible to claim ITC as per the document, if purchased within 12 months prior to appointed day. If they do not possess taxpaying document, then credit is available at the rate of 60% in case the goods are to be taxed at 18% on payment of GST and 40% for other goods.
The various scenario in claiming of transition relief are enclosed in Annexure 2.
The following are the action to be taken to ensure dealers avail the transition relief with ease and at the same time no excess claim is made;-
i. The transition provisions to be explained to the dealer groups
ii. The computer wing has developed the software to capture the stock position as on 31st March, 2017 and as on 31st May,2017 along with the monthly returns. The dealers are to be prevailed upon to furnish the information along with
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ll; TOT & composition dealers may adjust VAT invoices against stocks older than (12) months. Therefore, a correlation of stocks with the VAT invoices may be made by adopting first-in-first-out accounting method.
• All the cases where the rate of Tax on goods was higher in the existing Law (CENVAT + VAT) but is taxed at a reduced rate under GST Law are prone to stock manipulation. Therefore, all such cases may be flagged.
All the Deputy Commissioners are to take immediate action in this regard and report compliance.
Sd/- V. Anil Kumar
Commissioner (CT)
To
All the Deputy Commissioners (CT) in the State.
Copy to all the Senior Officers in O/o CCT.
Annexure 1
Transitional Provisions under GST Law
1) What are transitional provisions?
Ans) These are special provisions made in the GST Act to enable existing dealers under VAT / CENVAT Act to smoothly migrate to GST.
2) Who can avail reliefs under transitional provisions?
Ans) All the existing dealers can avail reliefs under
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ST on these goods.
* All returns for past (6) months are filed.
If CCF in VAT is due to CST transactions, then details of C, F, H or I Forms should be given in GST TRAN-1 Form.
2.
Un-availed CENVAT credit on capital goods which is not part of CCF can be availed as ITC in GST
Such credit should be admissible under CENVAT and GST Law.
3.
Duty or Tax paid on unsold stock can be availed as ITC in GST in the case of
* Presently un-registered person.
* Person using Taxable input for exempt output.
(a) Such stock should be covered by invoices evidencing payment of Tax / Duty and should not be earlier than (12) months from the appointed day.
(b) If invoice is not there, then stock should be covered by other purchase documents. Credit will be allowed after GST on supply of such goods is made.
* Stock statement should be provided in TRAN-1.
* In case of (b), credit will be allowed @60% if GST rate is equal to 18% and @40% if GST rate is less than 18%.
4.
Tax / Duty paid on go
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re a taxable person can claim credit of un-availed ITC under the existing law:-
* Scenario 1:- Treatment of CCF (Credit Carried Forward).
• Section 140(1) of CGST/SGST Act read with Rule 1(1) of transitional rules.
• The CCF can be utilized as credit in the GST by declaring it in GST TRAN-1 form within 90 days from Appointed Day (AD).
• The Registered Person (RP) claiming the CCF:-
o Shall not be under composition in GST.
o Such credit is admissible under GST.
o Such RP should have filed returns for the past 6 months from AD.
• CCF under CENVAT Act can be claimed by uploading details in Column 5(a) of the GST TRAN -1 form if:-
o The credit is not related to goods manufactured and cleared under any exemption notification.
• CCF under VAT Act can be claimed in the following manner:-
o If not related to CST transactions, CCF can be claimed straight away.
o If it is due to transactions made under CST Act, then:-
* If the transactions are between
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r than 12 months prior to AD.
o The details of stock shall be provided in statement 7(a), (b) & (c) of GST TRAN-1 form.
o If there is no invoice then credit shall be given as follows which can be utilized within 6 months:-
* If CGST / SGST > or = 9% then credit is 60% of GST paid.
* If CGST / SGST < 9% then credit is 40% of GST paid.
* If IGST > or = 18% then credit is 30% of IGST paid.
* If IGST < 18% then credit is 20% of IGST paid.
o The details of stock shall be provided in statement 7(a),(b) & (c) of GST TRAN-1 form and a monthly statement in GST TRAN-2 for 6 months.
* Scenario 4:- Treatment of credit pertaining to taxable and exempt goods / services under the existing law but taxable under GST and dealt by a single RP:-
• Section 140(4)
• The portion of CCF shall be treated as detailed in Scenario 1 above.
• The Duty / VAT paid on stocks shall be treated as Scenario 3 above.
* Scenario 5:- Treatment of tax paid under existing law on the goods re
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n 140(8)
• Such credit may be transferred any of the RPs with the same PAN.
* Scenario 9:- Treatment of consideration paid against reversal of CENVAT credit.
• Section 140(9)
• Such duty can be claimed as credit.
* Scenario 10:- Treatment of Job Work:-
• Section 141 read with Rule 3
• Where inputs are sent for job work prior to AD but returned to RP after AD, then tax not payable under GST if both the RP and the Job Worker declare the details of stock held by such job worker in Statement 9 of GST TRAN-1 form:-
o Goods are returned within 6 months from the AD, with an extension of 2 months with the permission of the commissioner.
• Where semi-finished goods are sent for job work prior to AD but returned to RP after AD, then tax not payable under GST if:-
o Goods are returned within 6 months from the AD, with an extension of 2 months with the permission of the commissioner.
• Where finished goods are sent to other / others premises for unde
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