Credit Transfer Document

[SUSHILKUMAR GOYAL]

What is Credit Transfer Document, as an amendment in Cenvat Credit Rules is proposed by GST Council at its meeting held on 3.6.2017.

[Rajagopalan Ranganathan]

Sir,

The balance of cenvat credit as per your return filed under existing law prior to the appointed date for implementation of GST Law will be the document on the basis of which you will be allowed to transfer the balance of credit available with you to electronic credit ledger. The procedure for such transfer is given in rule 1 of GST - TRANSITIONAL PROVISIONS - Final Rules 04-06-2017.

[Himansu Sekhar]

As per sec 140 of cgst act, the credit as appearing in the return will be transferred. Certain conditions have been imposedf

Credit transfer document (CTD) is an arrangement by government to give ITC to trader/dealer on high value stock/ Inventory (> 25000 per piece ) lying on appointed date (1st july) so that duty paid goods which has already suffered central excise should not be taxed again in full. It will be issued by manufacturers within 30 days of appointed date so that dealers/traders having stock of unsold items (like CAR/AC/ Washing Machines etc.) gets ITC of CGST in their electronic credit ledger. Otherwise they will end up paying the CGST from their own pocket when that item is sold after 1 july or will starts returning the same to manufactures.

[Himansu Sekhar]

I was not aware of ctd.

AI Summary

Credit Transfer Document enables transfer of pre-GST cenvat credit to electronic ledger, preserving input tax credit on unsold stock.
Credit Transfer Document (CTD) operates as a transitional mechanism allowing the cenvat credit balance shown in the return filed under the existing law prior to the appointed date to be transferred into the GST electronic credit ledger under prescribed transitional rules; manufacturers must issue CTDs within a short statutory window for high value unsold excise paid inventory so recipients can claim corresponding CGST input tax credit subject to specified conditions.