model gst law transitional provisions

MODEL GST LAW TRANSITIONAL PROVISIONS

MODEL GST LAW TRANSITIONAL PROVISIONS

Presented byCA. VINAY KAUSHIK

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PreambleWith the enactment of GST, various issues which a business unit/service provider shall face in this change over from earlier law to GST would be:Registration under GST when already registered under any of the earlier laws; CENVAT Credit;Goods return/Movement of Goods and Services;Revision of prices;Refunds pending in the earlier law;Issues relating to continuous supply of goods and servicesIssues of tax in case of goods lying with the agent.Credit Distribution of service tax by Input Service Distributor.Treatment of long term construction/works contracts.Deduction of Tax Source.

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2How presentation will benefit audience: Adult learners are more interested in a subject if they know how or why it is important to them.Presenters level of expertise in the subject: Briefly state your credentials in this area, or explain why participants should listen to you.

Preamble

Model GST Law takes care of Transitional Provisions under Chapter XXV of the Goods and Service Tax Act, 2016 comprising section 141 to section 162E and under Chapter X of the Integrated Goods and Service Tax Act, 2016 comprising section 31.

The object of this presentation is to impart understanding on various issues which a business unit/service provider shall face in this change over from earlier law to GST.

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3Example objectivesAt the end of this lesson, you will be able to:Save files to the team Web server.Move files to different locations on the team Web server.Share files on the team Web server.

RegistrationAs per Section 142 every person registered under any of the earlier laws be it Central Excise, VAT, Service Tax etc.SHALLbe mandatorily given registration on provisional basis. This provisional registration is only for six months.

Further on furnishing of such information and required documents and subject to the provisions of section 19, the provisional registration shall be confirmed by the government and shall be granted on a final basis by the Central/State Government. 01/08/2016 10:48 AM4

Input Tax Credit CENVAT credit carried forward Under Section 143. A registered taxable person shall be entitled to take, in his electronic credit ledger, credit of the amount of CENVAT credit (under CGST Law) or Value Added Tax (under SGST Law), as the case may be, carried forward in a return furnished under the earlier law in respect of the period ending with the day immediately preceding the appointed day in such manner as may be prescribed.

Provided that the taxable person shall not be allowed to take credit unless the said amount was admissible as CENVAT credit or Input Tax Credit, as the case may be, under the earlier law and is also admissible as input tax credit under this Act.

The amount taken as credit shall be recovered as an arrear of tax under this Act from the taxable person if the said amount is found to be recoverable as a result of any proceeding instituted, whether before or after the appointed day, against such person under the earlier law.01/08/2016 10:48 AM5

Input Tax Credit CENVAT credit on capital goodsAs per section 144. A registered taxable person shall be entitled to take, in his electronic credit ledger, credit of the un-availed CENVAT credit (under CGST Law) or un-availed input tax credit (under SGST Law) on capital goods, not carried forward in a return furnished under the earlier law by him.

The only condition where such carry forward shall not be allowed is when the CENVAT credit permissible under the earlier law is not admissible under the GST Law for the particular capital goods. As per Explanation 2 to section 144 Capital goods means the goods defined under clause (a) of rule 2 of CENVAT Credit Rules 2004.

The amount taken as credit shall be recovered as an arrear of tax under this Act from the taxable person if the said amount is found to be recoverable as a result of any proceeding instituted, whether before or after the appointed day, against such person under the earlier law. 01/08/2016 10:48 AM6

Input Tax Credit Credit of eligible duties and taxes on inputs held in stock As per Section 145 the registered taxable person shall be entitled to take the credit ofeligible duties and taxes(under CGST law) and Value Added Tax (under SGST Law)in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day subject to fulfilling of ALL the following conditions:such inputs and/or goods are used or intended to be used for making taxable supplies under this Act;the said taxable person was eligible for CENVAT credit / input tax credit on receipt / purchase, as the case may be, of such inputs and/or goods under the earlier law but for his not being liable for registration or the goods remaining exempt under the said law;the said taxable person is eligible for input tax credit under this Act;Contd01/08/2016 10:48 AM7

Input Tax Credit Credit of eligible duties and taxes on inputs held in stock the said taxable person is in possession of invoice and/or other prescribed documents evidencing payment of duty/tax under the earlier law in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day; andsuch invoices and/or other prescribed documents were issued not earlier than 12 months immediately preceding the appointed day.The amount of credit shall be calculated in accordance with generally accepted accounting principles in such manner as may be prescribed. The amount taken as credit shall be recovered as an arrear of tax under this Act from the taxable person if the said amount is found to be recoverable as a result of any proceeding instituted, whether before or after the appointed day, against such person under the earlier law.

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Excise Duty

Additional Excise Duty

National Calamity Contingent DutyDuties and taxes eligible for taking credit

Additional Custom DutyService Tax01/08/2016 10:48 AM9

Tax payer opting out composition scheme under GST LawTax payer opting in composition scheme under GST LawInput tax credit In relation to taxpayers covered under the composition scheme01/08/2016 10:48 AM10

Taxpayers opting OUT of Composition schemeA registered taxable person who was paying taxes under the composition scheme of earlier law shall be entitled to take the credit of eligible duties provided he fulfilsALL the following conditions:

such inputs and / or goods are used or intended to be used for making taxable supplies under this Act;the said person is not paying tax under section 8 i.e. composition scheme under GST;the said taxable person was eligible for CENVAT credit on receipt of such inputs and/or goods under the earlier law but for his being a composition taxpayer under the said law;Contd..01/08/2016 10:48 AM11

Taxpayers opting OUT of Composition schemethe said taxable person is eligible for input tax credit under this Act;the said taxable person is in possession of invoice and/or other prescribed documents evidencing payment of duty / tax under the earlier law in respect of inputs held in stock and inputs contained in semi- finished or finished goods held in stock on the appointed day; andsuch invoices and /or other prescribed documents were issued not earlier thantwelve months immediately preceding the appointed day. 01/08/2016 10:48 AM12

Taxpayers opting in the Composition scheme of GSTFor opting the composition scheme as prescribed by section 8 of Model GST Law the registered taxpayer shall pay the amount equivalent to the credit of the input tax in respect of inputs held in stocks and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date of such switch over. After payment of such amount the balance of input tax credit if any lying in the account of the tax payer shall lapse.01/08/2016 10:48 AM13

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Exempted Goods returned to place of business after theenactment of GST.Goods are identifiable to the satisfaction of the proper officer - Covered under Section 148

No Taxif the goods were removed 6 months prior to date of enactment.AND the goods are returned within 6 months of enactment Tax have to be paid if the goods are returned after 6 monthsMovement of goods after the enactment of GST01/08/2016 10:49 AM14

Duty Paid Goods Returned to a place of business on or after the date of enactment.Goods are identifiable to the satisfaction of the proper officer - Covered under Section 149

No Taxif the goods were removed 6 months prior to date of enactment.AND the goods are returned within 6 months of enactment Tax have to be paid if the goods are returned after 6 monthsMovement of goods after the enactment of GST01/08/2016 10:50 AM15

Goods sent on approval basis returned on or after the date of enactment - Covered under Section 162D

No Taxif the goods were removed 6 months prior to date of enactment.AND the goods are returned within 6 months of enactment Tax have to be paid if the goods are returned after 6 months. Competent Authority can extend this period bymaximum for 2 mothsMovement of goods after the enactment of GST01/08/2016 10:48 AM16

Inputs removed for Job Work and returned on or after the date of enactment - Covered under Section 150

No Taxif the goods were removed 6 months prior to date of enactment.AND the goods are returned within 6 months of enactment Tax have to be paid if the goods are returned after 6 months. Competent Authority can extend this period bymaximum for 2 moths

Taxability in case of Job Work01/08/2016 10:48 AM17

Semi-finished Goods removed for Job work and returned on or after the appointed day.- Covered under Section 151



Finished goods removed for carrying out certain processes and returned - Covered under Section 152




The prior condition to the scenario is that the person dispatching the goods andthe job worker declare the details of the goods held in stock by the job worker on behalfof the said person on the appointed day in such form and manner and within such time as may be prescribed.

Where the Prices of the goods / services supplied before enactment has increased - Covered under Section 153

The taxable person shall issue to the recipient a supplementary invoice or debit note containing the particulars within 30 days of such price revision. The tax shall have to be paid on the same as it will be classified as Deemed Sales.

Revision of Prices after the enactment of GST Law01/08/2016 10:48 AM21

Where the Prices of the goods / services supplied before enactment has decreased - Covered under Section 154.The taxable person shall issue to the recipient a supplementary invoice or credit note containing the particulars within 30 days of such price revision. The taxable person shall be allowed to reduce his tax liability on account of issue of the said credit note only if the recipient has reduced his Input Tax Credit Corresponding to such reduction of tax liability.

Revision of Prices after the enactment of GST Law01/08/2016 10:48 AM22

Pending refund claimsEvery claim for refund of any duty/tax and interest, if any, paid on such duty/tax or any other amount, filed by any person before the appointed day, shall be disposed of in accordance with the provisions of earlier law and any amount eventually accruing to him shall be paid in cash, notwithstanding anything to the contrary contained under the provisions of earlier law other than the provisions of sub section (2) of section 11B of the Central excise Act, 1944.

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Where the consideration for the supply of the goods/services have been received prior to the appointed day and the tax payable thereon has already been paid under the earlier law - Covered under Section 160

No Tax shall be payable on the supply of goods/services madeon or afterthe enactment of the law.

Continuous supply of goods and services01/08/2016 10:48 AM24

Where the part consideration for the supply of goods/services is received on or after the date of enactment but the full duty /tax payable on such supply has already been paid under the earlier law- Covered under Section 161

No tax shall be payable on the supply of goods and/or services madebeforethe date of enactment of law.

Continuous supply of goods and services01/08/2016 10:48 AM25

Where any goods belonging to the principal are lying at the premises of the agent on the day of enactment - Covered under Section 162A

Agent shall take credit of the tax paid only upon fulfilling the following conditions:Agent must be registered.Declaration by both of principal and agent regarding the stocks prior to the enactment of law.The invoices for such goods have been issued 12 months immediately preceding the date of enactment.The principal has either reversed or not availed the input tax credit in respect of such goods.

Tax relating to goods lying with the agent.01/08/2016 10:48 AM26

Where any capital goods belonging to the principal are lying at the premises of the agent on the day of enactment - Covered under Section 162B

Agent shall take credit of the tax paid only upon fulfilling the following conditions:Agent must be registered.Declaration by both of principal and agent regarding the stock of capital goods prior to the enactment of law.The invoices for such goods have been issued 12 months immediately preceding the date of enactment.The principal has either reversed or not availed the input tax credit in respect of such capital goods.

Tax relating to goods lying with the agent.01/08/2016 10:48 AM27

Service Tax Credit Distribution by Input Service DistributorThe input tax credit on account of any services received prior to the date of enactment by an Input service Distributor (ISD) shall be eligible for distribution as credit under this Act even if the invoice(s) relating to such services is received on or after the date of enactment.

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long term construction/works contractsThe goods and/or services supplied on or after the date of enactment in pursuance of a contract entered into prior to the date of enactment shall be liable to tax under the provisions of this Act.01/08/2016 10:48 AM29

long term construction/works contractsWhere 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 37 shall be made by the deductor under the said section where payment to the said supplier is made on or after the appointed day. 01/08/2016 10:48 AM30

Thank You

CA. Vinay Kaushik

B Com, FCA, DISA(ICAI), DIRM(ICAI), DEM, CCAB, CFAFP, CIFRS, COBIT (2012-Found)

Cell: +9227907024Email: [email protected] URL: www.vinaykaushik.com

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Thank You(Basic)

To reproduce the video effects on this slide, do the following:

On the Home tab, in the Slides group, click Layout, and then click Blank.On the Insert tab, in the Media group, click Video, and then click Video from File. In the left pane of the Insert Video dialog box, click the drive or library that contains the video. In the right pane of the dialog box, click the video that you want and then click Insert.Under Video Tools, on the Format tab, in the Sizing group, click the arrow to the right of Size launching the Format Video dialog box, select Size from the left pane and under Size in the right pane do the following:Click the Lock Aspect Ratio box.In the Height box, enter 6.03.In the Width box enter 8.03. Also in the Format Video dialog box, click Border Color in the left pane, under Border Color in the right pane select Solid Line, and then click the arrow to the right of Color, and under Theme colors select Black, Text 1, Lighter 25% (fourth row, second option from left).Also in the Format Video dialog box, select Border Style in the left pane, under Border Style in the right pane set the Width to 15 pt.Also in the Format Video dialog box, select Shadow in the left pane, under Shadow in the Right pane, click the arrow to the right of Colors and under Theme Colors, select Black, Text 1 (first row, second option from left), and then do the following:In the Transparency box, enter 60%.In the Size box, enter 100%.In the Blur box, enter 21 pt.In the Angle box, enter 40 degrees.In the Distance box, enter 19 pt.Also in the Format Video dialog box, select 3-D Format in the left pane, under Bevel in the right pane click the arrow to the right of Top and under Bevel, select Relaxed Inset (first row, second option from left), and then do the following:To the right of Top, in the Width box, enter 6 pt.To the right of Top, in the Height box, enter 16.5 pt.On the Home tab, in the Drawing group, click Arrange, point to Align, and then do the following: Click Align Center.Click Align Middle. Under Video Tools, on the Playback tab, in the Video Options group, select Loop until Stopped.On the Animations tab, in the Animation group, select Play.On the Animations tab in the Timing group, click the arrow to the right of Start and select With Previous.

To reproduce the text effects on this slide, do the following:

On the Insert tab, in the Text group, click Text Box, and then on the slide drag to draw a text box.Type text in the text box (Thank You or whatever text suits your message).Select the text, on the Home tab, in the Font group, select Garamond from the Font list, select 88 pt from the Font Size list, and then click on the Bold icon.Also in the Home tab, in the Font group, select the arrow to the right of the Font Color Icon, and then under Theme Colors, select White, Background 1 (first row, first option from left).With the text box selected, under Drawing Tools, on the Format tab, click the arrow in the bottom right corner of the WordArt Styles group, click the arrow opening the Format Text Effects dialog box. In the Format Text Effects dialog box, click 3-D Format on the left pane, under Bevel on the right pane, click the arrow next to Top and under Bevel select Relaxed Inset (first row, second option from left). Set the Width to 5 pt and the Height to 3 pt.Also in the 3-D Format right pane, under Surface, click the arrow next to Material and under Special Effect select Dark Edge (first row, first option from left).Also in the 3-D Format right pane, under Surface, click the arrow next to Lighting and under Neutral select Soft (first row, third option from left).Also in the 3-D Format right pane, under Surface, set the Angle to 290 Degrees.Close the Format Text Effects dialog box.

To reproduce the background effects on this slide, do the following:

On the Design tab, in the bottom right corner of the Background group, click the arrow at the bottom right corner launching the Format Background dialog box.In the Format Background dialog box, select Fill in the left pane, and under Fill in the right pane select Solid fill, then click the arrow to the right of Color and under Theme Colors select White, Background 1, Darker 50% (sixth row, first option from left).Close the Format Background dialog.

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model gst law transitional provisions

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