Goods and Services Tax

Transitional Provisions

GST – GST FAQ 2nd Edition – June 2017 as Updated as on 1.1.2018 – 24 – Q 1. Will CENVAT credit (or VAT credit) carried forward in the last return prior to GST under existing law be available as ITC under GST? Ans. A registered person, other than a person opting to pay tax under composition scheme, shall be entitled to take credit in his electronic credit ledger the amount of CENVAT (or VAT credit) credit carried forward in the return of the last period before the appointed day, subject to the conditions stated therein. (Section 140(1) of the CGST/SGST Act) Q 2. What are those conditions? Ans. The conditions are that: – (i) the said amount of credit is admissible as input tax credit under this Act; (ii) the registered person has furnished all the returns required under the existing law (i.e. Central Excise and VAT) for the period of six months immediately preceding the appointed date; (iii) the said amount of credit does not relate to goods manufactured and cleared under such notificat

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July, 2017 (i.e. in GST regime). Will such a person get full credit of CENVAT in GST regime? Ans. Yes, he will be entitled to credit in 2017-18 provided such a credit was admissible as CENVAT credit in the existing law and is also admissible as credit in CGST – section 140(2) of the CGST Act. Q 4. VAT credit was not available on items 'X' & 'Y' as capital goods in the existing law (Central Excise). Since they are covered in GST, can the registered taxable person claim it now? Ans. He will be entitled to credit only when ITC on such goods are admissible under the existing law and is also admissible in GST. Since credit is not available under the existing law on such goods, the said person cannot claim it in GST – proviso to section 140(2) of the SGST Act. Q 5. Assuming the registered person has wrongly enjoyed the credit (Refer to Q4) under the existing law, will the recovery be done under the GST Law or the existing law? Ans. The recovery relating to ITC wrongfully

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0/- in his last VAT return for the period immediately preceding the appointed day. Under GST he opts for composition scheme. Can he carry forward the aforesaid excess ITC to GST? Ans. The registered person will not be able to carry forward the excess ITC of VAT to GST if he opts for composition scheme – Section 140(1). Q 9. Sales return under CST (i.e. Central Sales Tax Act) is allowable as deduction from the turnover within six months? If, say, goods are returned in GST regime by a buyer within six months from appointed day, will it become taxable in GST? Ans. Where tax has been paid under the existing law [CST, in this case] on any goods at the time of sale, not being earlier than six months prior to the appointed day, and such goods are returned by the buyer after the appointed day, the sales return will be considered as a supply of the said buyer in GST and tax has to be paid on such supply, if, – (i) the goods are taxable under the GST Law; and (ii) the buyer is registered under t

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ls of inputs held in stock by the job worker on the appointed day in the prescribed form. The relevant sections are 141(1), 141(2) & 141 (4). However, if the said inputs/semi- finished goods are not returned within six months (or within the extended period of maximum two months), the input tax credit availed is liable to be recovered. Q 11. What happens if the job worker does not return the goods within the specified time? Ans. Input tax credit availed by manufacturer will be payable by said manufacturer on the said goods if they are not returned to the place of business of the manufacturer within six months (or within the extended period of maximum two months) from the appointed day – Q 12. Can a manufacturer transfer have finished goods sent for testing purpose to the premises of any other taxable person? Ans. Yes, a manufacturer can transfer finished goods sent for testing purpose to the premise of any other registered person on payment of tax in India or without payment of tax

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e not returned to the manufacturer within six months (or within the extended period of maximum two months) from the appointed day, the input tax credit availed by the manufacturer will liable to be recovered if the aforesaid goods are not returned within six months from the appointed day. – Section 141(3) Q 15. Is extension of two months as discussed in section 141 automatic? Ans. No, it is not automatic. It may be extended by the Commissioner on sufficient cause being shown. Q 16. What is the time limit for issue of debit/credit note(s) for revision of prices? Ans. The taxable person may issue the debit/credit note(s) or a supplementary invoice within 30 days of the price revision. In case where the price is revised downwards the taxable person will be allowed to reduce his tax liability only if the recipient of the invoice or credit note has reduced his ITC corresponding to such reduction of tax liability-section 142(2). Q 17. What will be the fate of pending refund of tax/interest u

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ision goes against the assessee? Ans. The refund will be made in accordance with the provisions of the existing law only. In case any recovery is to be made then, unless recovered under existing law, it will be recovered as an arrear of tax under GST – sections 142(6) & 142(7) Q 20. How shall the refund arising from revision of return(s) furnished under the existing law be dealt in GST? Ans. Any amount found to be refundable as a consequence of revision of any return under the existing law after the appointed day will be refunded in cash in accordance with the provisions of the existing law – section 142(9)(b). Q 21. If any goods or services are supplied in GST, in pursuance of contract entered under existing law, which tax will be payable? Ans. GST will be payable on such supplies- section 142(10) of the CGST Act. Q 22. Tax on a particular supply of goods/services is leviable under the existing law. Will GST be also payable if the actual supply is made in GST regime? Ans. No tax w

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