TRANSITIONAL PROVISIONS IN GST

1. TRANSITIONAL PROVISIONS IN GST

2. SECTIONS MIGRATION OF EXISTING TAX PAYERS [s. 139] CENVAT/VAT CREDIT CENVAT/VAT Credit c/f in a return to be allowed as ITC [s.140(1)] Un-availed CENVAT/VAT Credit on capital goods, not c/f in a return, to be allowed in certain situations [s.140(2)] INPUT CREDIT ON STOCK Of Inputs used for manufacture of goods exempted earlier but taxable now [ s.140(3)] manufacture of goods exempted and non exempted both [s. 140(4)] Inputs received on & after the appointed day [s. 140(5)] Of inputs held by a person switching over from composition scheme [s. 140(6)]

3. SECTIONS • JOB WORK • Inputs/semi – finished/Finished removed earlier for job work returned after the appointed day [ s. 141] • RECOVERY/REFUND [PENDING CLAIMS, CLAIM OF CENVAT/INPUT TAX, PROCEEDINGS RELATING TO OUTPUT DUTY LIABILITY, UPON ASSESSMENT/REVISION OF RETURNS] [s. 142] • MISCELLANEOUS [ s142]

4. General Concept if there is a output tax liability in GST. Credit on stock will available. Admissible in both Acts. Recovery according to GST. Refund according to existing Law.

5. MIGRATION OF EXISTING TAX PAYERS’ TO GST Taxable Person furnishes required information within 6 months FINAL REGISTRATION CERTIFICATE IS GRANTED Issue of Provisional Certificate with validity of 6 months Taxable Person does not furnish required information within 6 months Provisional Certificate may be Cancelled Provisional Certificate is cancelled upon dealer’s application [Not Liable under GST] Provisional Certificate is DEEMED NOT TO HAVE BEEN ISSUED

6. CENVAT/VAT CREDIT [S.140] C/F IN THE LAST RETURN PRE GST CENVAT/ VAT CREDIT UNAVAILED CREDIT ON CAPITAL GOODS MANUFACTURED GOODS EXEMPT EARLIER - TAXABLE NOW ENJOYED COMPOSITION PRE GST, NOW UNDER NORMAL SCHEME

7. CENVAT/VAT CREDIT [S.140] CENVAT/VAT CREDIT CARRIED FORWARD CREDIT WILL BE AVAILABLE IN GST UNAVAILED CENVAT/VAT CREDIT ON CAPITAL GOODS NOT CARRIED FORWARD Subject to the following Conditions : The amount has to be admissible as CENVAT/VAT credit under the earlier law & as ITC under the GST Law furnished all the returns for six months not claimed vat refund not manufactured under exemption notification other than paying tax under section 10

8. CENVAT/VAT CREDIT on stock of good held [S.140] • CENVAT Credit • Not Registered • Earlier Exempted • works contractor • availing benefit of notification • first stage dealer • second stage dealer • register importer • depot of manufacturer • but Taxable under GST

9. CENVAT/VAT CREDIT on stock of good held [S.140] • VAT Credit • not registered earlier • Earlier selling exempted goods • first point tax paid goods • Taxable under GST PROVIDED 9

10. CENVAT/VAT CREDIT on stock of good held [S.140] • Inputs are used for making taxable supplies • Inputs were otherwise available for CENVAT/VAT Credit if credit is available on it in GST • Is in possession of valid invoice, etc which were issued not earlier than 12 months from the appointed day, evidencing payment of duty • The supplier of services not taken any abatement 10

11. Not having invoice (other than a manufacturer of supply of service) Credit on Stock 40% Credit After payment of Tax Under GST Goods are not wholly exempted Benefit transfer to Recipient Scheme is available for Six Tax Periods Document of procurement is required. CENVAT/VAT CREDIT on stock of good held [S.140]

12. CENVAT/VAT CREDIT on stock of good held [S.140] • VAT/CENVET Credit • Manufactured & sold goods exempted & • non exempted both • Taxable under GST according sub sec 1 & sub sec 3 12

13. Goods Received on or after Goods and services received after appointed day. duty/Tax has been paid under existing Law. Recorded in books of accounts within 30 days. extended period 60 days. statement has to furnished. invoice detail description quantity and value.

14. CENVAT/VAT CREDIT on stock of good held [S.140] • in Composition but under Normal scheme in GST PROVIDED 14

15. CENVAT/VAT CREDIT on stock of good held [S.140] • Inputs are used for making taxable supplies • Inputs were otherwise available for CENVAT/VAT Credit if credit is available on it in GST • Is in possession of valid invoice, etc which were issued not earlier than 12 months from the appointed day, evidencing payment of duty • The Registered person not paying tax under section 10. 15

16. MISCELLANEOUS CREDIT DISTRIBUTION OF SERVICE TAX BY INPUT SERVICE DISTRIBUTORS [s.140] It is AN OFFICE of the supplier of goods/services which receives tax invoices for the purpose of distribution of credit to a SUPPLIERof taxablegoods/services having same PAN • RECEIVED - PRE GST • will be available for distribution as credit in GST • even if the invoices are received on or after the appointed day 16

17. ITC availability for centralized Registration ITR Carry forward in return. return for 3 months. Original Return / Revised return which claim less. ITC is admissible under this act. may be transfered to any registered person having same PAN.

18. ITC credit for services ITC reverse due to non payment Can be claimed if Payment received within 3 months. Eligible Duty for sub sec 3,4,6– Additional Duty of Excise (GSI), CVD, SAD, Additional Duty of Excise (T&T article), Duty of Excise, Additional Duty of Excise (M&T Article), National calamity Contingent duty, Service Tax (sub sec 5)

19. JOB Work (S141) Inputs, Semi Finished goods and Finished Goods • Conditions: • Removal/Dispatch to the job worker prior to the appointed day& • Returned within six months from the appointed day/extended period (not more than 2 months) • Manufacturer & Job Worker both declare the details of Inputs/Semi-finished/Finished Goods held in stock by the Job Worker on the appointed date No Tax is payable If Not Return within prescribed period ITC will be recovered Manufacturer can transfer finished goods to the premises of any regd. Taxable person for Export – without tax 19

20. Goods Return [S142] • When, • Goods were removed/sold within 6 months prior to the appointed day & • Returned within 6 months from the appointed day • Proper Officer can satisfactorily identify the goods, then for Goods on which Duty/Tax paid under the earlier law No Tax is payable by the person returning the Goods, If Unregistered Refund of Duty/ Tax Paid. Tax is payable by the person returning the Goods, If registered

21. Price Revision [S142] Price is REVISED after the appointed day in respect of a previous contract Documents that may be issued by the supplier ITC should be reversed Documents shall be deemed to have been issued in respect of an outward supply made under GST

22. REFUND/RECOVERY[s.142] Assessment/Adjudication Proceeding as per Earlier Laws(any tax/penalty/interest) CENVAT/VAT Credit as per Earlier Law Proceeding of appeal, revision, review or reference initiated before the appointed day to be disposed of as per the earlier law Refund/ Recovery Liability of Output Duty/ Tax as per Earlier Law Revision of return as per Earlier Law PENDING REFUND CLAIMS related for period BEFORE THE APPOINTED DAY to be disposed of as per the provisions of earlier law Any recovery pending after disposal of any proceeding will be recovered as an arrears of Tax under this act.

23. REFUND/RECOVERY[S 142] To be generally paid in Cash & as per the provisions of earlier law REFUND - Pending , on export,or accruing from appeal, etc Rejected Claim of Refund to LAPSE RECOVERY resulting from proceedings under the earlier law To be Recovered as an arrear of GST Amount refundable/recoverable shall not be admissible as ITC under GST

24. Goods Sent for approval (S142) No tax is payable. Returned within 6 months. extended period 2 months. Not Returned within prescribed period tax is payable by supplier. Returned after prescribed period tax is payable by person returning the goods.

25. Goods Sent for approval (S142) Goods Sent on approval basis Rejected Goods returned within six months No Tax is payable on returned goods Not earlier than six months prior to the appointed dated • Rejected Goods returnedafter six months/ extended period(Max. 2 months) • Goods taxable under GST Tax is payable by the person returning the goods Rejected/Not Approved by the buyer • Goods Rejected but not returned within six months/ extended period • Goods taxable under GST Tax is payable by the person who sent the goods on approval basis --- this provision is specific to SGST Law

26. MISCELLANEOUSDEDUCTION OF TAX AT SOURCE [s. 142] Goods sold/invoice issued prior to the appointed day Payment made against such sale, on or after the appointed day Tax was required to be deducted on such sale under earlier law Will not be considered for TDS under GST Law --- this provision is specific to SGST Law 26

27. MISCELLANEOUSTAX PAID ON GOODS/ CAPITAL GOODS LYING WITH AGENTS TO BE ALLOWED AS CREDIT [s142 Goods belonging to Principal lying with the agent on the appointed day • Conditions: • Agent is registered under GST • Principal & Agent both declare the details of stock of Goods lying with the agent immediately preceding the appointed day • Invoices were issued not earlier than 12 months prior to the appointed day • Principal has either reversed or not availed of the ITC in respect of such goods Agent entitled to take credit of tax paid on such goods --- this provision is specific to SGST Law

28. Reversed ITC[s. 142] Input Tax Credit reversed prior to the appointed day not admissible as Input Tax Credit under the GST Law NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THE GST ACT --- this provision is specific to SGST Law

29. ITC reversal Not in Composition Schemeearlier & having C/F eligible credit Moves to Composition Scheme in GST Shall Debit in the electronic credit/cash ledger 29

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