Availability of credit in special circumstances, under . Section 18 of CGST Act,2017

 

Section 18 of CGST Act,2017, Availability of credit in special circumstances

 

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The below post explains about Availability of credit in special circumstances under section 18 of CGST Act,2017.

 

Section 18 of CGST Act, 2017 explains Availability of credit in special circumstances as below: (The amendments if any will also be updated here soon).

 

The extract of Section 18 of CGST Act,2017 quoted below:

 

18.  Availability of credit in special circumstances.

 

18. (1) Subject to such conditions and restrictions as may be prescribed—

(a) a person who has applied for registration under this Act within thirty days

from the date on which he becomes liable to registration and has been granted such

Availability of credit in special circumstances, under . Section 18 of CGST Act,2017registration shall be entitled to take credit of input tax in respect of inputs held in stock

and inputs contained in semi-finished or finished goods held in stock on the day

immediately preceding the date from which he becomes liable to pay tax under the

provisions of this Act;

(b) a person who takes registration under sub-section (3) of section 25 shall be

entitled to take credit of input tax in respect of inputs held in stock and inputs contained

in semi-finished or finished goods held in stock on the day immediately preceding the

date of grant of registration;

(c) where any registered person ceases to pay tax under section 10, he shall be

entitled to take credit of input tax in respect of inputs held in stock, inputs contained in

semi-finished or finished goods held in stock and on capital goods on the day immediately

preceding the date from which he becomes liable to pay tax under section 9:

Provided that the credit on capital goods shall be reduced by such percentage

points as may be prescribed;

(d) where an exempt supply of goods or services or both by a registered person

becomes a taxable supply, such person shall be entitled to take credit of input tax in

respect of inputs held in stock and inputs contained in semi-finished or finished goods

held in stock relatable to such exempt supply and on capital goods exclusively used

for such exempt supply on the day immediately preceding the date from which such

supply becomes taxable:

Provided that the credit on capital goods shall be reduced by such percentage

points as may be prescribed.

 

 

(2) A registered person shall not be entitled to take input tax credit under

sub-section (1) in respect of any supply of goods or services or both to him after the expiry

of one year from the date of issue of tax invoice relating to such supply.

(3) Where there is a change in the constitution of a registered person on account of

sale, merger, demerger, amalgamation, lease or transfer of the business with the specific

provisions for transfer of liabilities, the said registered person shall be allowed to transfer the

input tax credit which remains unutilised in his electronic credit ledger to such sold, merged,

demerged, amalgamated, leased or transferred business in such manner as may be prescribed.

(4) Where any registered person who has availed of input tax credit opts to pay tax

under section 10 or, where the goods or services or both supplied by him become wholly

exempt, he shall pay an amount, by way of debit in the electronic credit ledger or electronic

cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs

contained in semi-finished or finished goods held in stock and on capital goods, reduced by

such percentage points as may be prescribed, on the day immediately preceding the date of

exercising of such option or, as the case may be, the date of such exemption:

Provided that after payment of such amount, the balance of input tax credit, if any,

lying in his electronic credit ledger shall lapse.

(5) The amount of credit under sub-section (1) and the amount payable under

sub-section (4) shall be calculated in such manner as may be prescribed.

(6) In case of supply of capital goods or plant and machinery, on which input tax credit

has been taken, the registered person shall pay an amount equal to the input tax credit taken

on the said capital goods or plant and machinery reduced by such percentage points as may

be prescribed or the tax on the transaction value of such capital goods or plant and machinery

determined under section 15, whichever is higher:

Provided that where refractory bricks, moulds and dies, jigs and fixtures are supplied

as scrap, the taxable person may pay tax on the transaction value of such goods determined

under section 15.

 

 

The above information clarifies about Availability of credit in special circumstances under section 18 of CGST Act,2017.  

 

If you have any comments about Section 18 of CGST Act, 2017 explaining Availability of credit in special circumstances, share below your thoughts:

 

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