Standardised PPT on GST

INDIRECT TAXES COMMITTEE

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
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This presentation has been prepared to provide a standard ‘user presentation’. The views expressed
in this presentation are those of Speaker(s). The Institute of Chartered Accountants of India may
not necessarily subscribe to the views expressed by the speaker(s).

The information cited in this presentation has been drawn from various sources. While every
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crept in while compiling the information provided in this presentation. Further, the information
provided in this presentation are subject to the provisions contained under different acts and
members are advised to refer to those relevant provision also. For clarifications write to us at
idtc@icai.in
© The Institute of Chartered Accountants of India
This standardised PPT may be used by any person with due
acknowledgement to the Indirect Taxes Committee of ICAI.

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 3

Transitional Provisions

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 Content 4

CGST Act: Sections 139 - Migration of existing

taxpayers

GST Transition Rules

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 Migration of Existing Taxpayers to GST – Sec 139 5

Every person registered under any of the existing laws and having a valid PAN will be issued a
provisional registration certificate (PRC)

Final RC will be granted by Central / State Government on furnishing of the prescribed

information

The PRC shall be liable to be cancelled if the conditions so prescribed are not complied with

Such PRC issued to a person not liable for registration under GST shall be deemed to have not
been issued if the registration is cancelled upon filing an application by such person

Person who is eligible to pay tax under composition scheme and who has been issued a PRC,
may opt to pay composition tax in the time and manner prescribed. In case he does not pay tax
under composition, he shall be liable to pay tax at normal rates

© Indirect Taxes Committee, ICAI

 Migration of Existing Taxpayers to GST – Sec 139 6

Every person, other than a TDS deductor or an ISD, registered under an existing law, having a
valid PAN shall enroll on the Common Portal by validating his e-mail address and mobile
number

Such persons shall be issued a PRC in FORM GST REG-25

A taxable person who was having multiple registrations under the existing law on the basis of a
single PAN, shall be granted only one provisional registration under the Act

Every person who has been issued a PRC, shall submit an application in FORM GST REG-26,
along with the specified information and documents, on the Common Portal, within 3 months

If the particulars furnished are found correct and complete, the proper officer shall issue the
certificate of registration in FORM GST REG-06
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 Migration of Existing Taxpayers to GST – Sec 139 7

In case of non-furnishing or incorrect submission of the information, the proper officer shall
cancel the provisional registration by issuing an order in FORM GST REG-28, after serving a
notice to show cause in FORM GST REG-27 and giving an opportunity of being heard

The show cause notice issued as above can be vacated by issuing an order in FORM GST REG-
20, if it is found, upon personal hearing, that no such cause exists for which the notice was issued

Every person registered under any of the existing laws, who is not liable to be registered under
the Act may, submit an application within 30 days of the appointed day, in FORM GST REG-
29, for cancellation of the registration granted to him and the proper officer shall, cancel the said
registration
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 8

CGST Act: Sections 140 – Transitional Arrangement for

Input Tax Credit

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 Carry forward of CENVAT Credit – Sec 140(1) 9

He should
credit should
have furnished Excess
not relate to Credit can
Allowed all the returns credit
Registered goods be taken in
carry forward Such credit required under taken will
taxable manufactured the
of Input tax/ must be the existing be
person and cleared electronic
CENVAT eligible law for the recovered
other than under such credit
credit – under GST period of six as arrears
compositio exemption ledger
through a law months of tax
n dealer notifications as
return immediately (CGST) under GST
are notified by
preceding the law
the Government
appointed day

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 Unavailed CENVAT Credit on Capital goods –
Sec 140(2) 10

A registered taxable Unavailed Credit on

person, other than Capital Goods (as per
In the electronic credit
composition dealer, shall Rule 2(a) CENVAT Credit
ledger
be eligible to take the Rule, 2004) not carried
credit forward in a return

Unavailed Credit = (Total Such credits must be

eligible credit – credit
availed) under the earlier
law
Excess claim shall be
eligible under the
recovered as arrears of
existing law AND under
tax under GST law
GST law

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 Credit of eligible duties and taxes on input
held in stock – Sec 140(3) 11
Person eligible for input
Credit available on Conditions
tax credit
• Person not liable to be • Inputs held in • Goods must be used or intended to be used for
registered under the stock and inputs taxable supplies
existing law ; contained in semi-
finished goods or • Reg person eligible to take the credit under GST law
• Person engaged in
manufacture / sale of finished goods
• Such person should be in possession of invoice or
exempted goods, held in stock as
on appointed day other prescribed document evidencing payment of
provision of exempted duty under the existing law in respect of such inputs
services;  Above
• Person providing works benefit not • Invoice or other document should be within 12
contract service and available months from the appointed day
availing abatement for input
services • the supplier of services is not eligible for any
under notification no.
26/2012; • Such credit can be abatement under this Act
• First / Second stage taken in the • Excess claims will be recovered as arrears of tax
dealer, importer, or electronic credit
under GST law
depot of a ledger
manufacturer.
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 Credit of eligible duties and taxes on input held in
stock - no documentary evidence– Sec 140(3) 12
Person eligible for input
Credit available on Amount of Credit that can be availed
tax credit
• a registered person, • Inputs held in • 60% of the CGST paid if Rate under CGST is 9% or more
other than a stock and inputs
manufacturer or a contained in semi- • 30% of the IGST paid if Rate under IGST is 18% or more
supplier of services. finished goods or
• 40% of CGST paid if in rate under CGST is less than 9%
• not in possession of an finished goods
invoice or any other held in stock as • 20% of IGST paid if in rate under IGST is less than 18%
documents evidencing on appointed day
 Above (Ref Rule 117(4) of CGST Rules, 2017)
payment of duty in
respect of inputs benefit not
available
for input • Similar provisions have been notified under SGST Act(s)
services for the credit of VAT to be allowed to trader in case of
• Such credit can be MRP based valuation where tax is paid at first point only.
taken in the
electronic credit • Statement in Form GST TRANS 2 to be submitted at
ledger end of each of 6 tax periods during which such scheme
is in operation.

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 Credit of eligible duties and taxes on input
held in stock – Sec 140(4) 13
A registered person who was engaged in the manufacture/ provision of exempted and taxable
goods/ services under Central Excise/ Service tax will be entitled to take the following amounts of
CENVAT credit in his electronic credit ledger:-
 Amount carried forward in the return furnished under earlier law;
 Amount of eligible duties contained in inputs held in stock and inputs contained in semi-
finished goods/ finished goods held in stock on the appointed day relating to exempted
goods/ services.

Subject to following conditions:

 The person must be a registered person under the GST Laws.
 In terms of the Rule 117 of CGST Rules, 2017 the application in Form GST TRANS -01 shall
specify separately the details of stock held on the appointed day upto 6 tax periods indicating
the details of supplies effected during each tax period
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 Credit of eligible duties and taxes on inputs /
input services during transit – Sec 140(5) 14

CGST
 A registered person is entitled to take credit in electronic credit ledger of eligible
duties and taxes on inputs / input services received on / after the appointed day but
the duty / tax has been paid by the supplier under the existing law
• Condition: Invoice / any other duty / tax paying document recorded in the books
of accounts within 30 days from the appointed day
SGST
 A registered taxable person shall be entitled to take credit in his electronic credit
ledger of VAT and Entry tax on inputs received on / after the appointed day but tax
has been paid by the supplier under the existing law
• Condition: Invoice / other tax paying document recorded in the books of accounts
within 30 days from the appointed day

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 Credit of duties on inputs held in stock on switching
over from composition scheme - Sec 140 (6) 15
Person eligible for
Credit available on
input tax credit
• A registered person • Inputs held in stock and
who was paying tax inputs contained in semi-
under composition finished goods or finished
scheme. goods held in stock as on
appointed day
 Above benefit not
available for input
services
• Such credit can be taken in
the electronic credit ledger
Conditions
• Person not paying taxes under
composition scheme under GST law
• Goods must be used for taxable supply
• Otherwise eligible to take the credit
under GST law
• Such person should be in possession of
invoice / other prescribed document
• Invoices / other prescribed document
was not issued earlier than 12 months
preceding appointed day

 In terms of the Rule 117 of CGST Rules, 2017 the application in FORM TRAN-1 shall be filed within 90
days (further extendable to 90 days) of the appointed day specifying eligible ITC amount.
 Scheme is available upto 6 tax periods

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 Credit distribution of service tax by ISD
(CGST) – Sec 140(7) 16

Input service distributor

shall be eligible for
distribution of credit

Invoices for such services

Services are received
are received on or after
prior to appointed day
the appointed day

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 Credit distribution of service tax by ISD
(CGST) – Sec 140(7) 17

SGST
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 Transfer of unutilised CENVAT credit by a person
having centralised registration – Sec 140(8) 18
Allowed to take
Taxable person has credit of CENVAT c/f
centralised Obtained registration in return furnished
registration under under GST Act under existing law in
existing law electronic credit
ledger
For the period ending with the day immediately preceding the appointed day
 If the taxable person files an original / revised return within 3 months of the appointed day
 Credit will be allowed if credit amount is reduced from that claimed earlier

Note:
1. Only those credits which are admissible under GST laws will be allowed
2. Credit may be transferred to any registered person having the same PAN for which centralised
registration was obtained under earlier law
3. Application in Form TRAN-1 within 90 days from appointed date
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 Availing credit in certain cases – Sec 140(9) 19

Credit can be
Cenvat credit
reclaimed if
Input services reversed due to
consideration is
provided under non-payment of
paid within 3
earlier law consideration
months from the
within 3 months
appointed day

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 20

CGST Act : Sections 141 – Transitional Provisions relating

to Job Work

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 Inputs removed for Job work and returned on
or after the appointed day – Sec 141(1)
Tax not payable when
Goods were removed/
dispatched as such or after
partial processing for job work
under the existing law prior to
appointed day;
Such goods are returned within
six months or within the
extended period (2 months)
from the appointed day to the
said place of business
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21
Tax payable when and by Applicability of
whom the exemption
Goods are liable for payment of
Manufacturer
taxes under GST; and
(under CGST Act ) /
person dispatching
Such goods are returned after 6 the goods (under
months or within the extended UTGST Act) and
period from the appointed day job worker should
declare details of
inputs held in stock
If goods are not returned within 6 by the job worker
months or extended period, input on behalf of the
tax credit availed in respect of sender on the
inputs removed will be recovered appointed day
from the sender
 Semi-finished goods removed for Job work and
returned on or after the appointed day – Sec 141(2) 22

Tax payable when and Applicability of the

Tax not payable when
by whom exemption

Semi finished goods were Goods are liable for

removed / dispatched for payment of taxes under
GST Manufacturer (under
processing under the
CGST Act )/ person
earlier law prior to Such goods are returned dispatching the goods
appointed day and; after six month or extended (under UTGST Act) and
period from the appointed job worker should declare
Such goods are returned day details of inputs held in
within six months or If goods are not returned within 6 stock by the job-worker on
within the extended period months or extended period, input behalf of the sender on the
(2 month) from the tax credit availed in respect of appointed day
appointed day to the said inputs removed will be recovered
place of business from the sender

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 Finished goods removed for carrying out certain processes
and retuned on or after the appointed day – Sec 141(3) 23

Tax payable when and Dispatches of goods

Tax not payable when
by whom from other premises

Goods are liable for payment of

Finished goods were removed
without payment of duty /
dispatched for processing under
the existing law prior to
appointed day; and
Such goods are returned within
six months or within the
extended period from the
appointed day to the said place
of business
taxes under GST;
Such Goods are returned after Sender may transfer goods
six month or extended period from such other place
from the appointed day; and; within six months on
payment of tax in India or
If goods are not returned within export without payment of
tax.
6 months or extended period,
input tax credit availed in
respect of inputs removed will
be recovered from the sender

© Indirect Taxes Committee, ICAI

 24

CGST Act: Sections 142 – Miscellaneous Transitional

Provisions

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 Goods returned to the place of business on or
after the appointed day – Sec 142(1) 25

• Goods on which duty had been paid were removed under the existing law (not
prior to six months from appointed day);
• Such goods are returned by an unregistered to the said place of business
Refund of duty
within six months from the appointed day; and
paid under
existing law • Such goods are identifiable to the satisfaction of proper officer

• If goods are returned by registered person

Deemed to be • Return shall be deemed to be supply
supply

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 Goods returned to the place of business on or
after the appointed day – Sec 142(1) 26

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 Issue of supplementary invoice, etc. where price
is revised in pursuance of a contract – Sec 142(2) 27

Issue of supplementary
Upward revision in the invoice or debit note
Contract entered prior price within 30 days from
to the appointed day such revision
and price of goods and
/ or services is revised
on or after the Issue of supplementary
appointed day Downward revision in invoice or credit note
the price within 30 days from
such revision

Note - Taxable person shall be allowed to reduce his tax liability, if the recipient of invoice or credit note has
reduced his input tax credit corresponding to such reduction of tax liability.

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 Issue of supplementary invoice, etc. where price
is revised in pursuance of a contract – Sec 142(2) 28

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 Pending refund claims to be disposed off under
existing law – Sec 142(3) 29

Refund claim of CENVAT Credit, duty, tax, interest and any other amount due under
existing law

Application to be filed before the appointed day

Refund proceeding will be in terms of existing law other than Section 11B (2) of Central
Excise Act, 1944

Eligible refund to be paid in cash and if fully or partially rejected; balance to lapse

Refund of balance of CENVAT credit carried forward under CGST Act shall not be
allowed

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 Pending refund claims to be disposed off under
existing law – Sec 142(3) 30

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 Refund claims filed in respect of goods / services
exported and services not provided – Sec 142(4) and (5) 31
 Goods / services exported before / after appointed day and claim of refund of
duty/ tax paid under existing law filed after appointed day
 Disposed of in accordance with existing law
 In case claim of refund rejected partly/ fully, amount rejected will lapse
 No refund allowed in cases where the same amount had been c/f as
CENVAT credit under this Act as on the appointed day
 Services not provided, however tax deposited under existing law and claim of
refund filed after appointed day
 Disposed of under existing law
 Any amount that accrues eventually will be paid in cash

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 Claim of CENVAT Credit to be disposed off
under the existing law – Sec 142(6) 32

Proceedings of appeal revision, review or reference relating to claim of CENVAT credit

will be disposed of in accordance with existing law;

Inadmissible Credit to be recovered as arrears of tax under GST law, unless recovered
under existing law

Not eligible for claim of input tax credit under GST law

Admissible CENVAT credit to be refunded in cash

No refund if credit is carried forward under the CGST Act

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 Claim of CENVAT Credit to be disposed off
under the existing law – Sec 142(6) 33

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 Finalization of proceedings relating to output
duty / tax liability – Sec 142(7) 34

Proceeding of appeal revision, review or reference relating to any output duty or tax
liability initiated before appointed date disposed of in accordance with existing law

Any amount payable to be recovered as arrears of tax under GST law, unless recovered
under existing law

Not eligible for claim of input tax credit under GST law

Admissible amount to the claimant to be refunded in cash

Amount rejected, if any, not admissible as input tax credit

© Indirect Taxes Committee, ICAI

 Treatment of the amount recovered or refunded in
pursuance of assessment or adjudication proceedings – Sec 35
142(8)
Assessment or adjudication proceedings instituted under existing law against recovery
of tax, interest or penalty whether before, on or after the appointed day

Amount recoverable to be recovered as arrears of tax under GST law, unless recovered
under existing law

Not eligible for claim of input tax credit under GST law

Amount becoming refundable to be refunded in cash

Amount rejected, if any, not allowed as input tax credit

© Indirect Taxes Committee, ICAI

 Sec 142 (7) & (8) 36

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 Treatment of amount recovered or refunded
pursuant to revision of return – Sec 142(9) 37

Recovered as arrears of tax

under GST and such
Amount recoverable/
amount shall not be eligible
credit inadmissible on
for input tax credit, unless
account of revision
recovered under existing
Revision of return
law
furnished under the
existing law
Amount Refunded in cash.
refundable/credit
admissible on account Amount rejected – not
of revision allowed as credit

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 Treatment of long term contracts - Sec 142(10) 38

Goods and / or services supplied on or after

appointed day

Contract entered prior to the appointed day

Liable for payment of taxes under the GST law

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 Taxability of supply of goods and services in
certain cases – Sec 142(11) 39

Goods - Services -
No tax payable under No tax payable under
CGST Act, to the extent CGST Act, to the extent
tax leviable under VAT tax leviable under
Act of the state Service Tax Law

If tax paid under VAT and Service

tax law – Tax leviable under GST
and taxable person shall be
allowed credit of VAT and Service
tax, in the manner to be prescribed

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 Goods sent on approval basis returned on or
after the appointed day – Sec 142(12) 40
• Goods sent on approval basis under existing law not earlier than six months from the
appointed day;
Tax not to be • Such goods are returned within six months or within the extended period from the
payable when appointed date

• Goods are liable for payment of taxes under GST; and

• Such goods are returned after six month or within the extended period from the
appointed day
• Tax shall be payable by person returning the goods, if the goods are returned after a
Tax to be period of six months or extended period of time from the appointed day
payable when
• Tax shall be payable by person who has sent goods on approval basis, if the goods are
and by whom
not returned within the six months or extended period of time from the appointed
day

Note – The details of goods sent on approval basis to be submitted in FORM GST TRAN 1
within 90 days of appointed day
© Indirect Taxes Committee, ICAI
 Deduction of tax at source – Sec 142(13) 41

TDS shall not be

made when

Payment of such
Invoices are issued Tax was liable to be
invoices is made on
before the appointed deducted under VAT
or after the appointed
day law
day

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 42

Thank You
For any Clarification, Please Contact
Indirect Taxes Committee of ICAI
Email: idtc@icai.in, Website: www.idtc.icai.org
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