TRANSITIONAL PROVISIONS-PART-IV
By: – Pradeep Jain
Goods and Services Tax – GST
Dated:- 31-12-2016<\/p>\n
GST DAILY DOSE OF UPDATION BY CA PRADEEP JAIN
\nTRANSITIONAL PROVISIONS-PART-IV
\n170. Credit of eligible duties and taxes in respect of inputs held in stock to be allowed in certain situations
\nThis is a new provision added in the act aiming to cover such assessees who are engaged in manufacture of both taxable and exempted goods or are providing both taxable and exempted services. This provision reads as follows:
\n(1) A registered taxable person, who was engaged in the manufacture of non exempted as well as exempted goods under the Central Excise Act, 1944 (1 of 1944) or provision of non-exempted as well as exempted services under Chapter V of Finance Act, 1994 (32 of 1994), shall be entitled to take, in his electronic credit ledger,
\n(a) the amount of Cenvat credit carried forward in a return furnished under the earlier law by him in terms of section 167; and
\n(b) the amo<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n services and reverse the cenvat credit at particular percentage on value of exempted goods; = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n is suggested that the credit on stock of inputs for exempted goods should be allowed subject to condition that the credit is not already taken. This provision will solve the problem. The assessee will be allowed to take the credit on stock of those inputs on which credit is not taken by him. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" TRANSITIONAL PROVISIONS-PART-IVBy: – Pradeep JainGoods and Services Tax – GSTDated:- 31-12-2016 GST DAILY DOSE OF UPDATION BY CA PRADEEP JAIN TRANSITIONAL PROVISIONS-PART-IV 170. Credit of eligible duties and taxes in respect of inputs held in stock to be allowed in certain situations This is a new provision added in the act aiming to cover such … Continue reading “TRANSITIONAL PROVISIONS-PART-IV”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-2066","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/2066","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2066"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/2066\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2066"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2066"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2066"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n3. take the credit on common input or input services and reverse the cenvat credit on proportionate basis.
\nThis provision very well covers the first provision i.e. where the manufacturer or service provider has maintained the separate inventory and has taken the credit only inputs used in manufacture of dutiable goods or provision of taxable services . Hence, he will be allowed to take the credit on stock of inputs of exempted final product or exempted service.
\nBut this provision does not hold good for the second alternative. If a manufacturer or service provider has already taken the credit on common input then credit cannot be allowed to him second time. Moreover, the credit is reversed at the time of removal of exempted final product or provison of exempted service. This mean that the credit is already contained in his balance for the stock of inputs lying with him. Then this provision wil<\/p>\n
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\nBut there are many other situations also where the credit is not taken by the assessee. We have come across a situation where the manufacturer has taken the credit only on inputs exclusively used inputs in dutiable final product but has not taken credit on common inputs for dutiable and final product as well as on inputs exclusively used in exempted final product. Hence, the credit should be allowed in such situation also.
\nSimilarly many exporter manufacturer are claiming drawback and forgoing Cenvat credit. But they intend to take the credit on input stock as they intend to avail the credit under GST regime.
\nSimilar is the situation for textile manufacturers who are exempted from payment of ex<\/p>\n
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