Input tax credit entitlement for transitional stock and capital goods, with prescribed reductions and transfer and reversal rules. Section 18 permits claiming input tax credit for inputs and inputs contained in semi finished or finished goods held in stock immediately before registration, change from composition to regular taxation, or conversion of exempt supplies into taxable supplies, with prescribed percentage reductions for capital goods; credit is barred for invoices older than one year. It allows transfer of unutilised electronic credit ledger balances on business reorganisation and requires payment from electronic ledgers when a person opts into composition or becomes exempt, after which any remaining credit lapses. Disposal of capital goods triggers payment equal to the higher of adjusted credit or tax on transaction value, with narrow exceptions for scrap.