transitional credit and anti profiteering

[giri gattupalli]

respected sir ,

whether transitional credit claimed and availed on the stock held on july-2017 to be passed to costumers under anti -profiteering rules or not if yes then what is the benefit for taxable person in claiming trasitional credit .please discuss

thanking you

[Ganeshan Kalyani]

Sir, the credit is eligible to offset it against the GST payable on those stocks when supplied. The incidence of tax is passed on thereby.

[KASTURI SETHI]

I concur with the views of Sh.Ganeshan Kalyani Ji.

[giri gattupalli]

thank you for sharing your valuable opinions

[KASTURI SETHI]

For more details, you must see the Order dated 6.7.22 passed by National Anti-Profiteering Authority in the case of Sh.Promod Agarwal & M/s.Arihant Superstructures Ltd.(2022 (7) TMI 698 - NATIONAL ANTI-PROFITEERING AUTHORITY)

[Amit Agrawal]

If you have carried forward tax-credit from old regime to new regime, anti-profiteering provisions will not apply. However, if you got 'additional' tax-credit under transitionary provisions or due to provisions of new regime anti-profiteering provisions will come into picture.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

AI Summary

Transitional credit: offset against tax on supplies may avoid anti profiteering unless additional transitional credit arises. Transitional input tax credit carried forward from the old regime may be used to offset output tax on supplies of pre transition stock and does not automatically engage anti profiteering. However, any additional tax credit arising under transitional provisions or the new regime that produces an incremental tax advantage can attract anti profiteering obligations requiring benefits to be passed to customers.