Input Tax Credit Under Model GST Law-Part2

For following scenarios and circumstances specific provisions have been given

When the person is liable for registration for first time?

In this situation, if the person applies for registration within thirty days then input tax credit can be in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day mmediately preceding the date from which he becomes liable to pay tax under the provisions of this Act.

When the person registers voluntarily?

In this situation input tax credit can be taken on inputs held in stock and inputs contained insemi-finished or finished goods held in stock on the day immediately preceding the date of grant of registration

When person shifts from Composition Scheme to Normal?

In this situation, input tax in respect of inputs held in stock, inputs contained in semi-finished or finished goods held in stock and on capital goods on the day immediately preceding the date from which he becomes liable to pay tax

When Exempt Goods or Supplies becomes Taxable?

In this situation, input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock relatable to such exempt supply and on capital goods exclusively used for such exempt supply on the day immediately preceding the date from which such supply becomes taxable

Point to be noted: A taxable person shall not be entitled to take input tax credit in respect of any supply of goods and / or services to him after the expiry of one year from the date of issue of tax invoice relating to such supply

When there is change in the business?

When there is change in business on account of sale, merger, demerger, amalgamation, lease or transfer of the business with specific provision for transfer of liabilities, the said registered taxable person shall be allowed to transfer the input tax credit that remains unutilized in its books of accounts to such sold, merged, demerged, amalgamated, leased or transferred business

When person shifts from normal scheme to Composition or Taxable goods exempt?

In this situation, an amount by way of debit in the electronic credit or cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date of such switch over or, as the case may be, the date of such exemption has to be remitted