Transitional provisions-Credit of tax paid in relation to unsold stock [Section 140(3)] – Actual Credit as well as Notional Credit – Part-II
By: – CASanjay Kumawat
Goods and Services Tax – GST
Dated:- 30-5-2017<\/p>\n
Trader's eligibility to claim credits on unsold stock on stock- Transitional Provision – Section 140(3)
\nState Levies
\nTaxpaying document available
\nQ. Whether a person can claim the credit for taxes paid in relation to goods lying in the stock where such person is having taxpaying documents?
\nAns. As per section 140(3) of SGST Act, 2017, a registered person under GST who was-
\n * not liable to be registered under the existing law, or
\n * sale of exempted goods or tax-free goods, or
\n * goods which have suffered tax at the first point of their sale in the State and the subsequent sales of which are not subject to tax in the State under the existing law but which are liable to tax under this Act, or
\n * where the person was entitled to the credit of input tax at t<\/p>\n
= = = = = = = =<\/p>\n
Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e credit under GST in relation to unsold stock: = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of capital goods cannot be claimed. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n can avail credit under this scheme. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" Transitional provisions-Credit of tax paid in relation to unsold stock [Section 140(3)] – Actual Credit as well as Notional Credit – Part-IIBy: – CASanjay KumawatGoods and Services Tax – GSTDated:- 30-5-2017 Trader's eligibility to claim credits on unsold stock on stock- Transitional Provision – Section 140(3) State Levies Taxpaying document available Q. Whether a person … Continue reading “Transitional provisions-Credit of tax paid in relation to unsold stock [Section 140(3)] – Actual Credit as well as Notional Credit – Part-II”<\/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-3526","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/3526","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=3526"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/3526\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3526"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3526"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3526"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n * such inputs and\/or goods are used or intended to be used for making taxable supplies under this Act,
\n * the said registered person is eligible for input tax credit on such inputs under this Act,
\n * the said registered person is in possession of invoice and\/or other prescribed documents evidencing payment of duty under the existing law in respect of such inputs, and
\n * such invoices and \/or other prescribed documents were issued not earlier than twelve months immediately preceding the appointed day.
\nNotional Credit @40%
\nTaxpaying document not available
\nQ. Whether a person can claim the credit for taxes paid in relation to goods lying in the stock where such person is not having taxpaying documents?
\nAns. As per proviso to section 140(3) of SGST Act, 2017 read with Rule 1 (3) of the Transition Rules, 2017, a registered person under GST can claim credit in relation to goods which have suffered tax at the first point of their sale i<\/p>\n
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\nQ. What will be the eligible credit amount that a person can claim in the case where the person is not having taxpaying documents?
\nAns. 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 SGST paid on the supply of such unsold stock.
\nFor example, a person is having the stock worth of Rs. 50,000\/- as on appointed date. Such person has supplied goods for Rs. 60,000\/- and on which he has paid SGST @28% i.e., Rs. 16,800\/-(Rs. 60,000@28%). Now, in accordance with the provisions of Transition Rules, he can claim credit to the extent of 40% of SGST paid, i.e., Rs. 6,720\/- (Rs. 16,800@40%).
\nQ. Is there any time period to avail this scheme?
\nAns. Yes, to claim benefit under this scheme, a person has to claim credit within 6 tax periods.
\nQ. What are the conditions to avail credit of tax\/duty paid in relation to unsold stocks as on appointed date?
\nAns.<\/p>\n
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\n Reply By Ganeshan Kalyani as =
\nPlease check “credit is eligible on 40% of SGST payable “. In my 40% of central GST payable would be available as credit.
\n Dated: 31-5-2017
\n Reply By CASanjay Kumawat as =
\nFor the credit of excise duty – 40 percent of CGST
\n[Legal reference : proviso to section 140(3) of the CGST Act, 2017 read with Rule 1(3) of the Transitional Rules, 2017 (For CGST only)]
\nFor the credit of VAT -40 percent of of SGST
\n[Legal reference : proviso to section 140(3) of the SGST Act, 2017 read with Rule 1(3) of the Transitional Rules, 2017 (For SGST Only) ]
\nIn the present case, I have discussed about credit in relation to VAT , accordingly , 40 percent of SGST payable shall be allowed as credit.
\n Dated: 31-5-2017
\n Reply By Krishna Murthy as =
\nPurchases made from outside the state (CST purchases) and tax paid to the seller and issued 'C' form to the seller. Such purchase is lying as stock as on appointed date. Can IT<\/p>\n
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