• Jun 11, 24
• bhushanbjain
• 0 comment

TAX OR DUTY CREDIT CARRIED FORWARD UNDER ANY EXISTING LAW OR ON GOODS HELD IN STOCK ON THE APPOINTED DAY

The concept of “tax or duty credit carried forward under any existing law or on goods held in stock on the appointed day” under the GST Act, 2017 pertains to the transitional provisions implemented during the shift from the previous indirect tax regime to the Goods and Services Tax (GST).

Here’s a breakdown under GST Act, 2017:

Existing Law under GST Act, 2017: Refers to the various indirect tax laws that were in place before the implementation of GST in India, such as Central Excise Act, 1944, State Value Added Tax (VAT) Acts, etc.

 Appointed  Day under GST Act, 2017: Refers to July 1, 2017, the date on which the GST Act came into effect.

Tax or Duty Credit under GST Act, 2017: This refers to the amount of tax or duty paid under the previous laws that could be claimed as a deduction against future tax liability.

 Carrying Forward the Credit under GST Act, 2017: Businesses were allowed to carry forward the unutilized tax or duty credit accumulated under the previous laws to the GST regime, subject to certain conditions and limitations. This was done to ensure a smooth transition and avoid businesses losing the benefit of the previously paid taxes.

Credit on Goods Held in Stock under GST Act, 2017: Businesses holding taxable goods in their stock on the appointed day (July 1, 2017) were allowed to claim a transitional input tax credit (ITC) on those goods, even if they couldn’t provide proof of tax payment under the previous laws. However, the ITC available on such goods was restricted to a specific percentage of the value.

EXAMPLE

Scenario under GST Act, 2017:

• A registered business in Tamil Nadu was entitled to claim credit for excise duty paid on raw materials (eligible duties under the previous regime) before the implementation of GST on July 1st, 2017 (the appointed day).
• The business had a stock of raw materials on the appointed day, and these materials were used for making finished goods after July 1st, 2017.

Action under GST Act, 2017:

• The business could claim input tax credit (ITC) under Section 140 of the GST Act, 2017, for the excise duty paid on the raw materials held in stock as of July 1st, 2017.
• To claim this credit, the business had to submit a declaration electronically in Form GST TRAN-1 within 90 days of the appointed day, specifying the amount of eligible duty credit they were entitled to claim.

FAQ QUESTIONS

The Goods and Services Tax (GST) Act, 2017, introduced a new tax regime in India, replacing various existing indirect taxes. This transition involved provisions for claiming credit for taxes paid under the previous regime, known as tax or duty credit carried forward.

Here’s a breakdown of the relevant provisions:

1. Credit for Existing Tax Credits under GST Act, 2017:

• Registered persons entitled to claim input tax credit (ITC) under Section 140 of the GST Act can avail credit for eligible duties and taxes paid under the existing laws (pre-GST regime).
• This credit needs to be claimed within 90 days of the appointed day (July 1, 2017) by electronically submitting a declaration in Form GST TRAN-1 on the GST portal.
• The eligible duties and taxes are defined in Explanation 2 to Section 140.

2. Credit for Goods Held in Stock under GST Act, 2017:

• Registered persons holding stock of goods on the appointed day, on which central excise duty or additional customs duties were paid under the previous regime, can claim ITC under certain conditions:
  • Not registered under the existing law under GST Act, 2017: If the person wasn’t registered under the previous regime, they can claim ITC at a rate of 60% of the central tax applicable on the supply of such goods after the appointed day.
  • Documents not available under GST Act, 2017: Even registered persons can claim ITC if they don’t possess documents evidencing payment of the duty, subject to conditions and limitations prescribed by the government.

Key Points under GST Act, 2017:

• Claiming credit requires following specific procedures and timelines mentioned in the Act and Rules.
• The rate of credit and eligibility criteria may vary depending on the specific situation.
• It’s advisable to consult a tax professional for guidance on claiming these credits in your specific case.

CASE LAWS

The Central Goods and Services Tax (CGST) Act, 2017, along with the corresponding CGST Rules, 2017, deals with the carry-forward of tax or duty credit under existing laws and on goods held in stock on the appointed day (July 1, 2017) for GST implementation.

Here’s a breakdown of the relevant provisions and case laws:

Provisions under GST Act, 2017:

• Section 140 of the CGST Act under GST Act, 2017 in Madurai: This section grants the right to claim input tax credit (ITC) on eligible duties and taxes paid under pre-GST laws like Central Excise Duty (CENVAT), Value Added Tax (VAT), etc.
• Rule 117 of the CGST Rules underGST Act, 2017 in salem: This rule specifies the procedure for claiming credit carry-forward. It states that a registered person can claim credit for:
  • Eligible duties and taxes paid under pre-GST laws for inputs used in the manufacture, processing, or service provision of goods or services.
  • Input tax involved in the remaining useful life of capital goods held in stock on the appointed day, calculated pro-rata based on a 5-year lifespan.

Declaration to be made under clause (c) of sub-section (11) of section142

The declaration you’re referring to is mandated under the Indian Goods and Services Tax (GST) regime. Here’s a breakdown of what it is:

Section under GST Act, 2017: 142 (11) (c) of the CGST/SGST Act

Purpose under GST Act, 2017: This provision requires certain taxpayers to electronically submit a declaration specifying the proportion of their supplies that were subject to Value Added Tax (VAT) before the implementation of GST.

Who needs to file under GST Act, 2017: This declaration applies to taxpayers who:

• Were registered under any VAT law before the introduction of GST.
• Have opted for the composition scheme under GST.

Form and Deadline under GST Act, 2017:

• The declaration needs to be filed electronically in Form GST TRAN-1.
• The deadline for filing is usually within the period specified in Rule 117 of the CGST/SGST Rules. This period can be extended by the Commissioner if needed.

Examples

• Purpose under GST Act, 2017: This declaration is likely required for availing Input Tax Credit (ITC) on purchases made from unregistered suppliers.
• Content under GST Act, 2017: The declaration would typically include details like supplier’s name, nature of supply, tax invoice number, and the amount involved.
• Authority under GST Act, 2017: You can find the exact format and requirements for the declaration on the official website of the Central Board of Indirect Taxes and Customs (CBIC) or the Goods and Services Tax Network (GSTN) 

Recommendation under GST Act, 2017:

For an accurate and compliant declaration, it’s advisable to consult a tax advisor or refer to official resources from the CBIC or GSTN

Case laws

• Search legal databases under GST Act, 2017 in Madurai: Legal databases like SCC Online or LexisNexis might have cases related to this provision. These databases are often subscription-based, but some courts might offer free public access to their judgments.
• Government websites under GST Act, 2017 in Salem: The website of the Central Board of Indirect Taxes and Customs (CBIC) or the Goods and Services Tax Network (GSTN) might have notifications or circulars clarifying the requirements of the declaration.
• Consult a tax professional under GST Act, 2017 in Vellore: A chartered accountant or tax lawyer specializing in GST can provide insights on relevant case laws or interpretations related to this specific provision.

Additional information under GST Act, 2017:

The relevant section seems to be related to the transition provisions under the GST law. Clause (c) of sub-section (11) of section 142 might deal with carrying forward tax credit on pre-GST supplies.

For further information on the declaration itself, you can refer to resources like the Maharashtra Goods and Sales Tax Department). This might provide details on the purpose and procedure for submitting the declaration.

Faq question

• Search legal databases under GST Act, 2017: Legal databases like SCC Online or LexisNexis might have cases related to this provision. These databases are often subscription-based, but some courts might offer free public access to their judgments.
• Government websites under GST Act, 2017: The website of the Central Board of Indirect Taxes and Customs (CBIC) or the Goods and Services Tax Network (GSTN) might have notifications or circulars clarifying the requirements of the declaration.
• Consult a tax professional under GST Act, 2017: A chartered accountant or tax lawyer specializing in GST can provide insights on relevant case laws or interpretations related to this specific provision.

Additional information under GST Act, 2017:

The relevant section seems to be related to the transition provisions under the GST law. Clause (c) of sub-section (11) of section 142 might deal with carrying forward tax credit on pre-GST supplies.

For further information on the declaration itself, you can refer to resources like the Maharashtra Goods and Sales Tax Department.This might provide details on the purpose and procedure for submitting the declaration.

Declaration of stock held by a principal and jab –workers

The term “jab-worker” likely has a typo and should be “job-worker.” In the context of GST (Goods and Services Tax) in India, the declaration of stock held by a principal and a job-worker refers to a specific filing requirement.

Here’s a breakdown:

• Principal under GST Act, 2017: This is the business that owns the raw materials or unfinished goods and outsources work on them to a job worker.
• Job Worker: This is a business that processes or works on the materials or goods provided by the principal to create a finished product. They are essentially hired for a specific task.

The declaration serves as a record of the inventory (inputs, semi-finished goods, or finished goods) held by the job worker on behalf of the principal. This is important for claiming Input Tax Credit (ITC) on the materials used in the processing.

Here’s some additional information under GST Act, 2017:

• The declaration needs to be filed electronically in Form GST TRAN-1.
• The specific rule mandating this declaration is Rule 119 of the CGST Rules (Central Goods and Service Tax Rules).
• You can find more details on this topic through resources like the Maharashtra’s website (be aware of not mentioning specific URLs in the response).

Case laws

there wouldn’t necessarily be a single, direct case law applicable to every situation involving “Declaration of stock held by a principal and job workers.” This is because judgements often hinge on the specific details and interpretations of contracts and statutes involved.

However, there might be relevant case laws that can inform your situation. Here’s how you can approach finding them:

• Keywords under GST Act, 2017 in Tirupur: Start by identifying relevant keywords to search for legal databases. Some options include “stock declaration,” “principal-job worker relationship,” “GST on stock transfers,” or “consignment stock.”
• Legal Research Resources under GST Act, 2017 in Chennai: Utilize online legal databases or academic resources that allow for case law searches. Examples include:
  • India Kanoon under GST Act, 2017 in Salem: [Indian Kanoon] (Indian Case Law repository)
  • Westlaw/LexisNexis (subscription-based legal research platforms)
• Focus on Recent Judgments under GST Act, 2017: Look for judgments from High Courts or the Supreme Court of India, ideally from the past decade to ensure they consider the latest legal interpretations.

Additional Tips under GST Act, 2017:

• Consult a lawyer: A legal professional can provide a more specific analysis based on the details of your situation and identify relevant case laws that apply.
• Consider the Specific Jurisdiction: Case laws from other countries might not be directly applicable in India. Focus on Indian legal precedents.

Remember, case law research can be complex. If you’re unsure where to begin, consulting a tax advisor or lawyer specializing in commercial transactions is recommended.

Faq questions

What is a declaration of stock held by a principal and job worker under GST Act, 2017?

This declaration is a requirement under the Goods and Services Tax (GST) in India. It involves a principal (who owns the raw materials) and a job worker (who processes those materials) filing a report about the stock of goods (inputs, semi-finished, or finished) held by the job worker.

Why is this declaration required under GST Act, 2017?

The declaration helps track the movement of goods between the principal and the job worker and ensures proper accounting of the Input Tax Credit (ITC) under GST.

Who needs to file this declaration under GST Act, 2017?

• Principals: Any business that supplies raw materials to a job worker for processing needs to file this declaration.
• Job Workers: Any business that receives raw materials from a principal for processing needs to be involved in filing this declaration (though the principal usually takes the lead).

What information is included in the declaration under GST Act, 2017?

The declaration typically includes details like:

• Description of the goods (inputs, semi-finished, or finished)
• Quantity of each type of good held by the job worker
• Value of the goods

When is the declaration filed under GST Act, 2017?

The declaration needs to be submitted electronically within a specified period (usually 90 days) from the “appointed day” for GST implementation. The Commissioner might extend this deadline.

How is the declaration filed under GST Act, 2017?

The declaration is filed electronically in Form GST TRAN-1 through the GST portal.

Where can I find more information under GST Act, 2017?

These resources can provide further details under GST Act, 2017:

• Maharashtra GST: [Declaration of stock held by a principal and job-worker or agent]
• [Search online for relevant CGST rules on stock declaration] (Avoid mentioning specific URLs)

Declaration of goods sent on approval basis

A “Declaration of Goods Sent on Approval Basis” isn’t a common term itself, but it likely refers to the process of reporting goods sent to a customer with the option to return them. This falls under the concept of “Sale on Approval Basis” within the GST framework.

Here’s a breakdown under GST Act, 2017:

• Sale on Approval Basis under GST Act, 2017: This is a business practice where a seller sends goods to a potential buyer who can decide to keep the items (considered a sale) or return them within a specified timeframe.
• Reporting Requirement under GST Act, 2017: While there isn’t a separate declaration form, businesses registered under GST might need to report these transactions electronically depending on the situation.

Here’s what you might need to know under GST Act, 2017:

• GST Invoice under GST Act, 2017: A tax invoice needs to be issued for the goods sent on approval basis. The timing depends on whether the goods are kept or returned:
  • Before or at the time of supply (when the buyer keeps the goods)
  • Within 6 months from the date the goods leave your premises (if there’s no sale)

It’s important to note that these are general points. For specific details and regulations, it’s advisable to consult a tax advisor or refer to official GST resources.

Examples

There isn’t a universally standardized format for a “Declaration of Goods Sent on Approval Basis.” However, a document outlining such a transaction can be created to ensure clarity between seller and buyer. Here’s an example of what it might include:

Declaration of Goods Sent on Approval under GST Act, 2017

This declaration is made on [Date] by [Seller Name] (hereinafter referred to as “Seller”) and [Buyer Name] (hereinafter referred to as “Buyer”).

Goodsunder GST Act, 2017

• Description of Goods: [Detailed description of the items being sent]
• Quantity: [Number of units]
• Value: [Total value of the goods]

Approval Basisunder GST Act, 2017

• The Seller agrees to send the aforementioned goods to the Buyer on an approval basis.
• The Buyer has [Number] days from the receipt of the goods to decide on their purchase.

Return of Goodsunder GST Act, 2017

• If the Buyer chooses not to purchase the goods, they must be returned to the Seller within the approval period mentioned above in undamaged condition.
• The Buyer is responsible for the return shipping costs.

Paymentunder GST Act, 2017

• If the Buyer decides to keep the goods, they will be invoiced for the full value mentioned above.
• Payment terms (e.g., net 30 days) should be clearly stated.

Other Considerations under GST Act, 2017

• You may want to include a clause about any risk or damage to the goods during the approval period.
• Specify who is responsible for insurance during this time.
• If there are any specific conditions for the Buyer’s approval (e.g., functionality testing), these should be outlined.

Signaturesunder GST Act, 2017

This declaration is signed by both parties below:

• Seller: [Signature] [Printed Name]
• Buyer: [Signature] [Printed Name]

Note: This is a sample format, and you may need to modify it based on your specific needs and applicable regulations. It’s always recommended to consult with a lawyer to ensure your declaration is legally sound.

Case laws

• Declaration of goods sent on approval basis under GST Act, 2017 in chennai: This refers to a specific declaration mandated under the GST rules (possibly Rule 117 to 120) for registered persons dealing with goods sent for approval (customer has the option to return them).
• Case Law under GST Act, 2017 in salem: These are legal precedents established by court decisions in past disputes.

There might be GST rulings or clarifications issued by authorities on the process of handling goods sent on approval basis. However, these wouldn’t be considered case law in the traditional sense.

If you’re interested in learning more about the declaration process for goods sent on approval basis, refer to the official resources of the Department of Goods and Services Tax (DGST) or consult with a tax professional.

Faq questions

• A seller sends goods to a buyer with the understanding that the buyer can keep them if they’re satisfied (approval), or return them if not (return).
• No formal declaration is typically required, but some sellers might include a packing slip or invoice mentioning “Sent on Approval” or “Sale on Return” terms.

Here are some examples of how this might be communicated:

• Packing Slip under GST Act, 2017: “These items are sent on approval. You have 10 days to decide if you’d like to keep them. Please notify us by [date] for a return or consider the purchase finalized.”
• Invoice under GST Act, 2017: “Sale on Approval – [List of Items]. Payment due only if you decide to keep the items.”

Remember, these are informal examples. The specific terms and timeframe for approval/return would be determined by the seller’s policy.

Revision of declaration in form Gst tran-1

• Opportunity under GST Act, 2017: There was a one-time window between October 1st and November 30th, 2022, to revise the initial GST TRAN-1 filing. This window is now closed.
• Purpose under GST Act, 2017: Use revisions to rectify any errors or omissions in the originally submitted claim for pre-GST VAT credit.
• Limitations under GST Act, 2017: Revisions can typically be done only once.

Current Scenario (as of March 30, 2024) under GST Act, 2017:

Since the revision window is closed, you cannot modify your GST TRAN-1 electronically at this time. However, you can still reach out to the tax authorities for guidance if you believe there’s a significant error in your original filing.

Example

The GST portal allows revising a previously filed Form GST TRAN-1 under specific circumstances. Here’s an example to understand the process better:

Scenario under GST Act, 2017:

Let’s say a company, ABC Ltd., initially filed Form GST TRAN-1 in December 2017, claiming a specific amount of input tax credit (ITC) on pre-GST stock. However, upon further review in March 2024, they discover an error in the quantity of stock reported, leading to an incorrect ITC claim.

Revision Process under GST Act, 2017:

1. Access GST Portal under GST Act, 2017: Login to the GST portal using your company’s GST Identification Number (GSTIN).
2. Navigate to TRAN Forms under GST Act, 2017: Locate the section for filing GST TRAN forms.
3. Revise TRAN-1 under GST Act, 2017: Look for the option to revise a previously filed TRAN-1. The portal might provide a downloadable copy of the original declaration for reference.
4. Correct Errors under GST Act, 2017: Update the section with the mistake. In this case, ABC Ltd. would modify the quantity of stock held, leading to a revised ITC claim.
5. Supporting Documents under GST Act, 2017: Include any documents that support the revisions made, such as revised stock records.
6. Submit Revised Form under GST Act, 2017: Submit the revised Form GST TRAN-1 electronically with a digital signature or Electronic Verification Code (EVC).

Important Points under GST Act, 2017:

• There was a limited window in 2022 for revising TRAN-1 forms based on a Supreme Court order. Check with a tax advisor for the current revision timelines.
• Revisions can only be made once. Ensure the revised declaration is accurate to avoid further complications.
• Consult a tax professional for guidance on revising Form GST TRAN-1, especially for complex situations.

Remember, this is a simplified example. The specific revision process and requirements might vary depending on the nature of the error and current GST regulations.

Case laws

• Jakap MetindPvt Ltd vs Union Of India Through The Secretary (on October 4, 2019): This case clarifies that revision of Form GST TRAN-1 is allowed under Rule 120A of the CGST Rules. The revision can be done within the period specified for filing the form or any further extension granted by the Commissioner.

Important Note under GST Act, 2017 in Salem: This case also highlights that the revision period is bound by the filing deadline and any extensions, not the 90 days mentioned in the rules.

• Directions by Supreme Court (October 2022) under GST Act, 2017 in Chennai: While not strictly a case law, this Supreme Court directive allowed a specific window for taxpayers to file or revise their TRAN-1 forms between October 1 and November 30, 2022. This window provided an opportunity for those who missed the initial deadline or had errors in their filings.

These are the key cases related to revision of Form GST TRAN-1. It’s important to remember that GST regulations can change, so consulting with a tax professional for the latest guidance is recommended.

Faq questions

Can I revise the declaration filed in Form GST TRAN-1 underGST Act, 2017?

As of March 30, 2024, the functionality to revise the information submitted in Form GST TRAN-1 is not yet enabled on the GST portal.

Here’s what we know from available information:

• Earlier stance: Initially, there was no provision for revising details in Form GST TRAN-1.
• Current status: While there have been discussions about enabling revision, the system update for allowing revisions hasn’t been implemented yet.

What are my options if I need to make changes to the information filed under GST Act, 2017?

There isn’t a confirmed way to directly revise the form yet. Here are some possibilities:

• Consult a tax advisor: Discuss your situation with a tax professional for guidance on the best course of action. They might suggest waiting for the revision functionality or explore alternative solutions based on your specific situation.
• Contact GST authorities: You can reach out to the GST authorities to inquire about any updates on revision capabilities or seek alternative solutions for handling discrepancies.

Are there any resources for further information under GST Act, 2017?

• While official resources might not explicitly mention revision yet, you can stay updated by following the official GST portal announcements
• You can find discussions about the revision request in some tax professional forums: “[search gst tran 1 revision forum]” (Remember, I cannot provide specific URLs).