TRANSITIONAL PROVISIONS UNDER GST

Transcription

1 TRANSITIONAL PROVISIONS UNDER GST By: CA. KARAN SINGAL Partner SINGAL & COMPANY TRANSITIONAL PROVISIONS Pending Cenvat Credits (S. 167, 168) Eligible duties & taxes on input Stock (S. 169, 170,171,172) Goods Returned after appointed date (S. 173,174) Material removed for Job work/ other process (S. 175,176,177) Issue of supplementary invoices, debit/credit notes (S. 178) Miscellaneous Situations 1

2 Pending Cenvat Credits Amount of Cenvat Credit carried forward in a return to be allowed as input tax credit (S. 167) Input tax credit must be c/f in return, relating to the period ending with the day immediately preceding the appointed day, furnished, by him under the earlier law. Subject to claims under s. 3, 5(3), 6, 6A of CST Act, 1956 and rule 12 of CST (Registration and turnover) rules, Unavailed cenvat credit on capital goods, not c/f in a return, to be allowed in certain situations (S. 168) Unavailed tax credit means amount that remains after subtracting the amount of tax credit already availed from the aggregate amount of tax credit. Capital goods means the goods as defined under rule 2(a) of Cenvat Credit Rules, Such credit should not be c/f in a return furnished in earlier law. All Cenvat Credits, VAT and Entry taxes will be allowed as input tax credit PROVIDED -Person should not opt to pay tax under section 9 i.e. composition levy. -Said credit should be admissible as input tax credit under GST Act. Eligible duties & taxes on input Stock Section 169 A Registered Taxable Person Who, As per earlier laws Not liable to be registered (i.e. Retail Traders, SSI) Manufacturers of Exempted goods Provider of Exempted services Provider of Works Contract Services and availing benefit of Notification No. 26/2012 FSD / SSD Registered Importers shall entitled to take credit of eligible duties and & taxes in respect of inputs held on appointed date in Stock Semi Finished Goods Finished Goods 2

3 Eligible duties & taxes on input Stock Section 170 A Registered Taxable Person Who, As per earlier laws Manufacturer of Exempted as well as non exempted goods as per Central Excise Act, 1944 Provider of Exempted as well as Non Exempted Services shall entitled to take credit of eligible duties and & taxes in respect of inputs held on appointed date in For Non Exempted goods/services as per section 167 For exempted goods/services as per section 169 Eligible duties & taxes on input Stock Section 171 Inputs and Input services during in-transit A Registered Taxable Person Who, As per earlier laws Received some Inputs or Input services after the appointed day But duties and taxes in respect of which has been paid before the appointed day shall entitled to take credit of eligible duties and & taxes in respect of inputs held on appointed date in PROVIDED Invoice or any other document evidencing the payment of duties /taxes booked in the books of accounts Within 30 days from the appointed date 3

4 Eligible duties & taxes on input Stock Section 172 A Registered Taxable Person Who, As per earlier laws was paying tax At fixed rate As fixed amount i.e. composition tax payer shall entitled to take credit of eligible duties and & taxes in respect of inputs held on appointed date in, ONLY IF He opt to switch over from composition scheme under GST Law. Goods Returned after appointed date Section 173 EXEMPTED GOODS Returned No tax shall be payable by person returning the goods, if any one condition fulfilled:- such goods are returned to such place of business within period of six months. PROVIDED the same has not been removed not being earlier than six months prior to appointed date. Such goods are not taxable in GST Act. Person returning the goods not registered under GST Act. Section 174 DUTY PAID GOODS Returned If returned to such place of business within period of six months by non taxable person:- Duty paid at the time of removal can be claimed as refund PROVIDED the same has not been removed not being earlier than six months prior to appointed date. Such goods are not taxable in GST Act. Person returning the goods not registered under GST Act. 4

5 Material removed for Job work/ other process Section 175 : Section 176 : Section 177 : Inputs sent on job work returned i.e. testing, repair, Processing, reconditioning etc. Semi finished goods sent on job work retuned. Finished goods removed for certain process returned. In above cases no tax payable by Person returning the goods, Provided Goods return within six months from the appointed day. Manufacturer and job worker both must declare such goods in form prescribed Else Input tax credit availed by manufacture on such goods liable to be recovered as section 184 i.e. as arrear. Issue of supplementary invoices, debit/credit notes Section 178 In case of Price revision through supplementary invoice or debit/credit note, pursuant of a contract Such document deemed to be issued in respect of outward supply under GST Act. Provided Invoice or debit or credit note issued within 30 days of price revision In case of downward revision of price i.e. credit note, recipient of credit note reduced his input tax credit. 5

6 Section 186 Long term construction/work contracts Supply on or after appointed day liable to be taxed a per GST Act. Section 187 Progressive or Periodic supply If consideration is received in full or part and tax/duty paid for supply made on or after appointed day then no tax to be paid on such supply under GST Act. Section 188 In case of supply of Service & Section 189 In case of supply of Goods Tax shall be payable as per earlier law if point of taxation arose before the appointed day but where portion of supply does not covered under this section, shall be taxable under GST Act. 6

7 Section 190 Input Service Distributer ISD can distribute credit in respect of services received before appointed date even if invoice for the same received after appointed day Section 191 unutilized cenvat credit with taxable person having centralized registration Such cenvat credit can be taken to electronic credit ledger of taxable person and he can transfer such credit to any taxable person having the same PAN i.e. for any of its unit provided He files his return, for the period ending just before the appointed day within 3 months. Said credit must be admissible as ITC under GST law. 7

8 Section 192 & 193 Tax paid Goods or Capital Goods lying with Agent agent shall be entitled to take credit of tax paid on such goods Provided Agent is registered taxable person. Principal and agent both declare the details of such goods. Purchase invoice of such goods is not older then 12 months form appointed day. Principal has either reversed the credit or not availed input tax credit on such goods. Section 195 Goods sent on approval basis returned If goods sent on approval basis, within the period of six months before the appointed day, returned by buyers then no tax payable on return Provided Goods sent returned within period of six months or extended period from the appointed day After six months. If goods returned by buyer then tax shall be payable by buyer. If goods not returned in six months the tax shall be payable by supplier. 8

9 Section 197 in case cenvat credit reversed under earlier law due to non payment of consideration within 3 months, such credit can be claimed again Provided Such person has made payment of consideration within 3 months from the appointed day CA. Karan Singal cakaransingal@gmail.com 9

10 (A) 2(a) "capital goods" means:- the following goods, namely:- (i) all goods falling under Chapter 82, Chapter 84, Chapter 85, Chapter 90, heading No grinding wheels and the like, and parts thereof falling under heading 6804 of the First Schedule to the Excise Tariff Act; (ii) pollution control equipment; (iii) components, spares and accessories of the goods specified at (i) and (ii); (iv) moulds and dies, jigs and fixtures; (v) refractories and refractory materials; (vi) tubes and pipes and fittings thereof; and (vii) storage tank, used- (1) in the factory of the manufacturer of the final products, but does not include any equipment or appliance used in an office; or (2) for providing output service; (B) motor vehicle registered in the name of provider of output service for providing taxable service as specified in sub-clauses (f), (n), (o), (zr), (zzp), (zzt) and (zzw) of clause (105) of section 65 of the Finance Act; Other Administrative sections 179. Pending refund claims to be disposed of under earlier law 180. Refund claims filed after the appointed day for goods cleared or services provided before the appointed day and exported before or after the appointed day to be disposed of under earlier law 181. Refund claims filed after the appointed day for payments received and tax deposited before the appointed day in respect of services not provided 10

11 Other Administrative sections 182. Claim of cenvat credit to be disposed of under the earlier law Finalization of proceedings relating to output duty or tax liability 184. Treatment of the amount recovered or refunded in pursuance of assessment or adjudication proceedings 185. Treatment of the amount recovered or refunded pursuant to revision of returns Other Administrative sections 196. Deduction of tax source Where a supplier has made any sale of goods in respect of which tax was required to be deducted at source under the earlier law and has also issued an invoice for the same before the appointed day, no deduction of tax at source under section 46 shall be made by the deductor under the said section where payment to the said supplier is made on or after the appointed day. 11