Transitional itc
This query is : Resolved
22 September 2017
Sir,a registered person having no excise duty paid invoices with him but wants to take cgst credit on the excisable stock as on 1.7.2017,is he liable to file tran1,tran2 and tran3? Or he will file tran 1&2 only?as per law,in absence of excise duty paid invoices the manufacturer has to issue credit transfer document to the dealer enable him to avail transitional credit under cgst act.
23 September 2017
pl.resolve the issue.
24 September 2017
pl.give a reply.
02 August 2025
Thanks for your question! Here's a detailed explanation regarding transitional ITC under CGST for excisable stock when you don't have excise duty-paid invoices as of 1.7.2017:
---
### 1. Can a registered person claim CGST credit on excisable stock without excise duty-paid invoices?
* **No excise duty-paid invoice = no direct documentary proof** of duty paid on stock.
* Under the GST transition provisions, **to claim transitional credit on excisable stock held as on 01.07.2017, the manufacturer (or supplier) must issue a Credit Transfer Document (CTD)** to the registered recipient (dealer).
* This CTD allows the dealer to **avail transitional credit on the stock** even if he does not have excise duty-paid invoices.
---
### 2. Which forms need to be filed?
* **TRAN-1**: To claim credit on inputs, input services, and capital goods including stock of excisable goods on 1.7.2017.
* **TRAN-2**: To claim credit on inputs held in stock for **input service distributors**.
* **TRAN-3**: For claiming credit on inputs lying in the factory of the manufacturer or principal manufacturer (where excise was paid) and to be distributed to registered recipients.
---
### 3. What applies in this case?
* Since you **do not have excise duty-paid invoices**, you cannot claim credit directly in **TRAN-1** for excisable stock.
* You **cannot claim excise duty credit in TRAN-1 or TRAN-2 without excise duty invoice or CTD**.
* If the manufacturer issues a **Credit Transfer Document (CTD)** to you (the registered dealer), you become eligible to claim credit under GST on the excisable stock.
* Therefore, you **may not need to file TRAN-3** yourself as it is generally filed by the manufacturer (principal manufacturer) who issues CTD.
* You as the dealer will file **TRAN-1 and TRAN-2** (if applicable), but **you can claim credit only after CTD is issued by the manufacturer**.
---
### Summary:
| Situation | Forms to File | Comments |
| --------------------------------------- | --------------------------------- | --------------------------------------------------- |
| Dealer has no excise duty-paid invoices | TRAN-1 and TRAN-2 (if applicable) | Cannot claim credit on excisable stock without CTD. |
| Manufacturer issues CTD | Manufacturer files TRAN-3 | Dealer can claim credit based on CTD under GST. |
| Dealer claims credit without CTD | Not allowed | Claim likely to be rejected by GST authorities. |
---
### Practical Advice:
* **Get the manufacturer to issue a Credit Transfer Document (CTD)** for the stock held on 1.7.2017.
* Only then can you claim transitional credit on excisable stock under GST.
* Ensure proper coordination with the supplier/manufacturer for smooth credit transfer.
* File **TRAN-1** (and **TRAN-2**, if applicable) to claim ITC under GST after you have CTD.
---
If you want, I can also help you with a sample format of CTD or guide you through filing TRAN-1 with proper entries. Would you like that?
---
### 1. Can a registered person claim CGST credit on excisable stock without excise duty-paid invoices?
* **No excise duty-paid invoice = no direct documentary proof** of duty paid on stock.
* Under the GST transition provisions, **to claim transitional credit on excisable stock held as on 01.07.2017, the manufacturer (or supplier) must issue a Credit Transfer Document (CTD)** to the registered recipient (dealer).
* This CTD allows the dealer to **avail transitional credit on the stock** even if he does not have excise duty-paid invoices.
---
### 2. Which forms need to be filed?
* **TRAN-1**: To claim credit on inputs, input services, and capital goods including stock of excisable goods on 1.7.2017.
* **TRAN-2**: To claim credit on inputs held in stock for **input service distributors**.
* **TRAN-3**: For claiming credit on inputs lying in the factory of the manufacturer or principal manufacturer (where excise was paid) and to be distributed to registered recipients.
---
### 3. What applies in this case?
* Since you **do not have excise duty-paid invoices**, you cannot claim credit directly in **TRAN-1** for excisable stock.
* You **cannot claim excise duty credit in TRAN-1 or TRAN-2 without excise duty invoice or CTD**.
* If the manufacturer issues a **Credit Transfer Document (CTD)** to you (the registered dealer), you become eligible to claim credit under GST on the excisable stock.
* Therefore, you **may not need to file TRAN-3** yourself as it is generally filed by the manufacturer (principal manufacturer) who issues CTD.
* You as the dealer will file **TRAN-1 and TRAN-2** (if applicable), but **you can claim credit only after CTD is issued by the manufacturer**.
---
### Summary:
| Situation | Forms to File | Comments |
| --------------------------------------- | --------------------------------- | --------------------------------------------------- |
| Dealer has no excise duty-paid invoices | TRAN-1 and TRAN-2 (if applicable) | Cannot claim credit on excisable stock without CTD. |
| Manufacturer issues CTD | Manufacturer files TRAN-3 | Dealer can claim credit based on CTD under GST. |
| Dealer claims credit without CTD | Not allowed | Claim likely to be rejected by GST authorities. |
---
### Practical Advice:
* **Get the manufacturer to issue a Credit Transfer Document (CTD)** for the stock held on 1.7.2017.
* Only then can you claim transitional credit on excisable stock under GST.
* Ensure proper coordination with the supplier/manufacturer for smooth credit transfer.
* File **TRAN-1** (and **TRAN-2**, if applicable) to claim ITC under GST after you have CTD.
---
If you want, I can also help you with a sample format of CTD or guide you through filing TRAN-1 with proper entries. Would you like that?
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