Under Model GST Law, specific provisions have been given to avail input credit. In this video we are going to talk about the provisions of section 167 of Model GST Law. The provisions can be divided into two categories
Input Credit Admissible under CGST Law
Input Credit Admissible under SGST Law
Input Credit Admissible Under CGST Law
A registered taxable person, other than a person opting to pay tax under composition scheme ,shall be entitled to take, in his electronic credit ledger, the amount of cenvat credit carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished, by him under the earlier law in such manner as may be prescribed
To Illustrate this, let’s say GST is effective from 1st of April 2017. In this case, Cenvat Credit carried forward in ST-3 return and ER returns as on 31.03.2017 can be claimed as input tax credit under Model GST Law.
Point to be Noted: The input tax credit so claimed shall fall within the definition of Input Tax credit defined in GST Law
Input Credit Admissible Under SGST Law
Under SGST Law, A registered taxable person, other than a person opting to pay tax under composition scheme, shall be entitled to take, in his electronic credit ledger, credit of the amount of Value Added Tax [and Entry Tax] carried forward in the a return relating to the period ending with the day immediately preceding the appointed day, furnished, by him under the earlier law, not later than ninety days after the said day, in such manner as may be prescribed
To Illustrate this, let’s say GST is effective from 1st of April 2017. In this case, VAT Input carried forward in VAT return as on 31.03.2017 can be claimed as input tax credit under Model GST Law.
Point to be Noted: The input tax credit so claimed shall fall within the definition of Input Tax credit defined in GST Law
The input credit as carried forward in VAT return, comprising of credit which relates to section3, sub-section (3) of section 5, section 6 or section 6A of the Central Sales Tax Act, 1956 should be substantiated and refunded back else the credit is not admissible under Model GST Law