A company paid CST, in current regime, based commercial invoice, which is as per the agreement between the parties, but the goods are kept in the supplier's premises at the request of the buyer. Hence Excise Duty is not yet paid. Now, if the goods are actually removed
in GST regime, what will be the tax liability? Under what provisions?
9 Replies
Kothandaraman R
(DGM)
(41 Points)
Replied 20 May 2017
You mean whether consideration for the commercial invoice received?
If you mean this, the answer is yes.
If you mean this, the answer is yes.
CA Altamush Zafar
(GST Consultant)
(15976 Points)
Replied 20 May 2017
The best course of action in this case would be to pay excise before appointed day and receive goods after appointed day. Then you will be able to get credits provided you enter it in your books within 30 days. Additional details have to be furnished as per rules.
If however goods remain in factory till appointed date and then transferred GST will be applicable and of course credits will also be available.
If however goods remain in factory till appointed date and then transferred GST will be applicable and of course credits will also be available.
Kothandaraman R
(DGM)
(41 Points)
Replied 20 May 2017
In CGST Sec.141(11)(c) provides that the VAT paid on the invoice is eligible as credit. The real problem is there is no such provision for credit of CST paid. Further confusion is the wording used. It talks about VAT AND See.Tax paid. Note it is AND not OR. Appears to be a drafting error. But can't assume so if you recall the controversy in Rule 14 (interest) of CCR 2004.
CA Altamush Zafar
(GST Consultant)
(15976 Points)
Replied 20 May 2017
Are credits available for CST under current Laws??
Regarding IGST your electronic credit ledger will remain nil. No credits from current taxation regime will be transferred to IGST.
Regarding IGST your electronic credit ledger will remain nil. No credits from current taxation regime will be transferred to IGST.
Kothandaraman R
(DGM)
(41 Points)
Replied 20 May 2017
I was not talking about input tax credit. In my understanding Sec.143(11)(a) of CGST also does not talk about input VAT credit. It is a mechanism to avoid double taxation since sales tax is already paid on the basis of invoice and since GST is dual tax,. i.e., SGST & CGST.
CA Altamush Zafar
(GST Consultant)
(15976 Points)
Replied 20 May 2017
Yes it is and clause c is for supplies like that of restaurant and works contract, however the transition rules are still not final
Kothandaraman R
(DGM)
(41 Points)
Replied 20 May 2017
But Act doesn't provide for such a situation. So Rules cannot be framed beyond what the Act provides for
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