GST transitional credit: imposing a 12 month invoice limit on first stage dealers disrupts pass through and risks double taxation.
Section 140(3)(iv) imposes a 12 month invoice age restriction on transitional ITC; applying this manufacturer style time bar to first stage dealers is new and retrospective, disrupts the pass through of duty embedded in pre GST stock, risks double taxation, and lacks a rational nexus to transition objectives. The restriction improperly imports Rule 4(7)'s one year limit (meant for manufacturers/service providers) onto dealers, and accrued credit that has satisfied statutory conditions should be treated as a vested right not arbitrarily extinguishable. (AI Summary)