Draft Rule for issue of Credit Transfer Document (CENVAT Credit Rules, 2004)
As GST Appointed Date is coming Closer, So it's Important to have a complete knowledge about how can we minimise Transitional Loss in terms of Input Credit on Closing Stock,
Section 140 of CGST Act covers detailed procedure of how one can claim Input Credit even if he have no Excisable Invoice, But still Industry is worried about high value Items present in Closing Stock (As per GST if Invoice is not available than 40% or 60% rebate can only be available, subject to fulfilment of all the conditions of Section 140), So in terms of high Value Items Draft rule for issue of Credit Transfer Document to be inserted in the CENVAT Credit Rules, 2004 for transfer of Cenvat credit paid on specified goods available with a trader as on appointed date.
Below are the Conditions to fulfill so that Manufacturer can issue Credit Transfer Note -
1. Per Piece/ Item value > Rs. 25,000/-, bears Brand of Manufacturer, have distinct Identifiable No. Per Piece/ Item value > Rs. 25,000/-, bears Brand of Manufacturer, have distinct Identifiable No.
2. Verifiable records of clearance and duty payment.
3. CTD should be Serially Numbered & includes Excise Registration No, GSTIN of Trader, Description, Classification & other Details.
4. The manufacturer is satisfied that the dealer to whom CTD is issued is in possession of such manufactured goods.
5. Credit Transfer Document shall be issued within 30 days of the appointed date
6. Complete Chain of Invoices (Copy) relating to buying and selling from manufacturer to the dealer to be maintained by the dealer availing credit (CTDs).
7. If Invoice was issued before Appointed Date, NO CTD to be issued for the same Goods.
8. If Taking credit as per CTD, than not eligible for input under Rule 1(4) of Transitional Rules (40%-60% Input on CGST).
9. Mention corresponding CTD Number on each Supply Invoice (under GST after Appointed Date).
10. Manufacturer is jointly and severally responsible for excess credit availed by the dealer and & recovery of credit, interest and penalty as per the CCR Rules.
11. Manufacturer issuing CTD - submit details thereof in table 1 of TRANS 3 within 60 days of the appointed date.
12. Trader availing Credit on CTD - submit details thereof in table 2 of TRANS 3 within 60 days of the appointed date.
13. Manufacturer issuing CTD - maintain record in Form TRANS 3A (to be made available for verification if Central Excise Officer demands).
14. Dealer availing Credit on CTD - maintain record in Form TRANS 3B (to be made available for verification if Central Excise Officer demands).
PRACTICAL CASE STUDY -