TRANSITIONAL CREDIT

[THYAGARAJAN KALYANASUNDARAM]

Dear Expert,

We need clarification on the transitional credit.

Mr. A provider of service under pre-gst and he purchased Capital Goods in March' 2017 and he files his monthly returns only as exempted sales as labour charges and also he claims 50% tax on capital goods in the financial year 2016-17 and balance 50% claimed through tran-1 and utilised in GST regime after implementation of GST Act.

further, after implementation of the GST he collects GST on the supply of service w.e.f. 1st July 2017 and discharged to the govt. exchequer promptly.

Query.

1. Whether he eligible to claim the 50% input under VAT regime.

2. Whether it can be carry forward under GST regime.

Please advice me. Thanks in Advance.

AI Summary

Clarification Sought on Carrying Forward 50% Input Tax Credit on Capital Goods Purchased Pre-GST via TRAN-1 An individual sought clarification on transitional credit under the GST regime, specifically regarding the eligibility to claim 50% input tax credit on capital goods purchased before GST implementation. The individual had claimed 50% under the VAT regime and intended to carry forward the remaining 50% using TRAN-1 after GST implementation. Experts advised that the time limit for filing TRAN-1 has expired, and if the amount was reflected in VAT returns, a refund could be applied for if not time-barred. Otherwise, legal recourse through a writ petition in the High Court may be considered.