Skip to main content

GST Transitional Claims of Over Rs 1 Cr to be Scrutinised

GST Transitional Claims of Over Rs 1 Cr to be Scrutinised
While tax collections in July were Rs 95,000 cr, transitional credit claims are Rs 65,000 cr

As much as Rs 65,000 crore out of the nearly Rs 95,000 crore tax collections in July -the first month of GST -have been claimed as transitional credit by taxpayers, prompting the apex indirect taxes body the Central Board of Excise and Customs to order a scrutiny of all cases above Rs 1 crore.
 
The Goods and Services Tax (GST) regime, which kicked in from July 1, allows tax credit on stock purchased during the previous tax regime. This facility is available only up to six months from the date of GST rollout.

The Central Board of Excise and Customs (CBEC), the body which deals with formulation and implementation of policy concerning the levy and collection of indirect taxes, in a letter dated September 11 has asked tax officials to verify GST transitional credit claims of over `1 crore. In the transitional credit form TRAN-1 filed by taxpayers along with their maiden returns for July, businesses have claimed a credit of over Rs 65,000 crore for excise, service tax or VAT paid before the GST was implemented from July 1.

In light of such huge claims, CBEC Member Mahender Singh in a letter to chief commissioners said that as per the GST law, carry forward of transitional credit is permitted only when such credit is permissible under the law.

“The possibility of claiming ineligible credit due to mistake or confusion cannot be ruled out... It is de sired that the claims of ITC (input tax credit) of more than Rs 1 crore may be verified in a time-bound manner,“ the CBEC emphasised. It asked the chief commissioners to send a report to the CBEC by September 20 on the claims made by these companies.

To ensure only eligible credit is carried forward in the GST regime, the CBEC has asked field offices to match the credit claimed with closing balance in returns filed under the earlier law. They are also required to check if the credit is eligible under the GST laws.

Till last week, as many as 70 % of 59.57 lakh taxpayers had filed returns for July, amounting to maiden revenue of Rs 95,000 crore under the GST regime.

However, out of this, the input tax credit (ITC) data for Central GST (CGST) claimed in TRAN-1 has shown that registered businesses have claimed over Rs 65,000 crore as transitional credit.

The government, in late August, had come out with form TRAN-1for businesses to claim credit for taxes paid on transition stock.

The Economic Times, New Delhi, 16th September 2017

Comments

Popular posts from this blog

Credit card spending growth declines on RBI gaze, stress build-up

  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the...

SFBs should be vigilant, proactive to mitigate risks: RBI deputy guv

  The Reserve Bank of India’s Deputy Governor Swaminathan J on Friday instructed the directors of small finance banks (SFBs) to be vigilant and proactive in identifying emerging risks in the sector.Speaking at a conference for directors on the boards of SFBs, Swaminathan highlighted the role of governance in guiding SFBs towards sustainable growth with stability. He also emphasised the importance of sustainable business models.Additionally, he highlighted the need for strengthening cybersecurity to protect the entities against digital threats and urged for a stronger focus on financial inclusion, customer service, and grievance redressal to ensure a broader reach of banking services.Executive Directors S C Murmu, Rohit Jain, and R L K Rao, along with other senior officials representing the Supervision, Regulation, and Enforcement Departments of the RBI, also participated in the conference.   -  Business Standard  30 th  September, 2024

Brigade Hotel Ventures files draft papers with Sebi for Rs 900 crore IPO

  Brigade Hotel Ventures Ltd, owner and developer of hotels in South India, has filed draft papers with capital markets regulator Sebi to raise Rs 900 crore through an initial public offering (IPO).The proposed IPO is entirely a fresh issue of equity shares with no Offer-for-Sale (OFS) component, according to the draft red herring prospectus (DRHP).Proceeds from the issue to the tune of Rs 481 crore will go towards payment of debt, Rs 412 crore will be allocated to the company and Rs 69 crore to its material subsidiary, SRP Prosperita Hotel Ventures Ltd.Additionally, Rs 107.52 crore will be used to purchase an undivided share of land from the Promoter, BEL, and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.The company may raise up to Rs 180 crore through a Pre-IPO Placement.   If the placement is undertaken, the issue size will be reduced.Brigade Hotel Ventures Ltd is a wholly-owned subsidiary of Brigade Enterprises ...