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Whether a manufacturer can avail deemed credit in respect of transitional stocks on the appointed day in respect of the stocks for which duty paying document is not available

  1. In terms of the proviso to Section 140(3) of the CGST Act, 2017, the manufacturer is not eligible to avail deemed credit in respect of transitional stocks, for which duty paying document is not available.
  2. Such credit is not available in case of SGST except where VAT was payable on the basis of MRP.

(FAQ 9: DRUGS AND PHARMACEUTICALS)

Commets: Under SGST credit is available only on first stage taxable goods

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What is the transitional credit that can be availed on the existing stocks held by a registered person under GST, who was not required to be registered under the existing law

  1. In terms of Rule 117(4) of the CGST Rules, 2017 (transitional provisions) read with Section 140(3) of the CGST Act, 2017, a registered person who was not registered under the existing law and who is not in possession of any document evidencing payment of central excise duty in respect of the goods held in stock, shall be allowed credit at the rate of sixty per cent on such goods which attract central tax at the rate of nine per cent or more and forty per cent for the other goods of the central tax applicable on supply of such goods after 01st July 2017 and the said amount shall be credited in the electronic credit ledger after the central tax payable on such supply has been paid.
  2. In case where integrated tax is paid, the amount of ITC would be at the rate of thirty per cent and twenty per cent respectively of integerated tax.
  3. This facility is available for a maximum period of 6 months from the appointed day (i.e. upto 31st December, 2017) or till the goods are sold out, whichever is earlier.

( FAQ 8: DRUGS AND PHARMACEUTICALS)

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How loan and licensee units carry out their operations in GST regime

GST law does not have any special provision for loan and licensee units. Where the contract are in the nature of performance of job-work, these units can opt to follow the procedure laid down in section 143 of the CGST Act, 2017 i.e. the principal can send any inputs etc. to such units without payment of tax and  the principal can clear the goods from the premises of such units if the principal declares these units as his additional place of business or where such units are themselves registered under section 25 of CGST Act, 2017.

[FAQ 4: Drugs and Pharmaceuticals]

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What is the procedure for movement of time expired medicines from the retail outlets to the manufacturer for destruction

  1. In such cases, the manufacturer may issue a credit note within the time specified in sub-section (2) of section 34 of the CGST Act, 2017 subject to
    the condition that the person returning the expired medicines reduces his ITC.
  2. Subsequently, when the time expired goods are destroyed, the manufacturer
    has to reverse his ITC on account of goods being destroyed.
  3. Where the goods are returned after the time limit specified in section 34(2) of the CGST Act, 2017, the registered person returning the goods shall issue a tax invoice, as it is a supply within the meaning of Section 7 of the CGST Act, 2017.

FAQ3: Drugs and Pharmaceuticals

Comments: But a retail outlet can not issue a tax invoice to wholesale under Drugs and Medicines Act.

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Date of filing of Return for July 2017 for OIDAR Service from outside India to a non-taxable online recipient extended to 15-09-2017

Notification 25/2017-CT dated 28-08-2017.

As per Rule 64, Every registered person providing online  information and data base access or retrieval services from a place outside India to a person in India other than a registered person shall file return in FORM GSTR-5A on or before the twentieth day of the month succeeding the calendar month or part thereof.

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Extension of Due date of filing of Return GSTR-6 by ISD for July and Aug 2017

Date for GST return GSTR-6  by ISD for July and August 2017 has been extended to

  • 8th September for July 2017
  • and to 23rd September for August 2017

[Notification 26/2017-CT  dated 28-08-2017]

Comments :

  1.  The above dates have been set just two days before due dates for GSTR-2.
  2. As per Rule 59(5) , The details of invoices furnished by an Input Service Distributor in his return in FORM GSTR-6 under rule 65 shall be made available to the recipient of credit in Part B of FORM GSTR 2A electronically through the common portal and the said recipient may include the same in FORM GSTR-2.
  3. GSTR-6 by ISD is required to be filed under Rule 65 by taking into consideration the information in GSTR-6A.  As per Rule 59(3), information submitted by supplier in GSTR-1 relating to ISD travels to ISD through GSTR-6A