TRANS-1 IF CAPITAL GOODS 100% CLAIMED

[ABHILASH PANICKER]

Dear Sir/Madam,

GST Notice # towards availing of 100% credit on capital goods in Trans-1 is irregular., whereas the provision and explanations allows only "Unclaimed Balance Amount ".

My Query is that I Forget to take cenvat credit on Capital goods (Import ) (B/E related to May & June 2017 )., and also Not shown in ER-1,

Wether I Claimed I00% in Trans-1.

Regards

[KASTURI SETHI]

You could claim only 50% in the first year. If any one forgets to avail 50% credit in the first year, that person can take 100 % next year but not 100% in the very first year.. It is a procedural lapse. You must have utilised that credit. Interest is payable. .

[Shilpi Jain]

From the transitional provisions, the credit of capital goods which remained unclaimed can be claimed in TRAN-1 provided it was eligible under cenvat rules

[Ganeshan Kalyani]

Extract from transition provision u/s 140

(2) A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, credit of the unavailed CENVAT credit in respect of capital goods, not carried forward in a return, furnished under the existing law by him, for the period ending with the day immediately preceding the appointed day 8[within such time and] in such manner as may be prescribed:

Provided that the registered person shall not be allowed to take credit unless the said credit was admissible as CENVAT credit under the existing law and is also admissible as input tax credit under this Act.

Explanation.––For the purposes of this sub-section, the expression “unavailed CENVAT credit” means the amount that remains after subtracting the amount of CENVAT credit already availed in respect of capital goods by the taxable person under the existing law from the aggregate amount of CENVAT credit to which the said person was entitled in respect of the said capital goods under the existing law.

AI Summary

Unavailed CENVAT credit may be claimed in transitional form if admissible under prior law and current input tax credit rules.
Entitlement exists to claim the unavailed CENVAT credit for capital goods in the transitional form into the electronic credit ledger, only if that credit was admissible under the former CENVAT regime and is also admissible as input tax credit under the current law; "unavailed CENVAT credit" is the balance after deducting CENVAT credit already availed from the aggregate CENVAT credit to which the person was entitled for those capital goods.