CA Final · Indirect Tax Laws

Miscellaneous Provisions (GST): formula sheet

Full chapter guide

Key formulas

Appointed day: Appointed day = 1 July 2017; Every transition question is solved by comparing dates with this date.
Goods sent on approval, returned in time: Removed not earlier than 6 months before the appointed day, and returned within 6 months from the appointed day → no tax payable; The goods must have been rejected or not approved by the buyer. The Commissioner may extend the period by up to 2 more months for sufficient cause, on request.
Goods on approval, not returned in time: Not returned within 6 months (or the extended period) → tax payable by the person who removed the goods; The removal is treated as a supply. The removing person bears the liability.
Goods sold earlier, returned after the appointed day: (c) Returned within 6 months from the appointed day by a person who is not registered → the seller is not liable to GST on the return, and the old-law tax is refunded on proof of the return. (d) Returned within 6 months by a registered person → treated as a supply by that returning person under GST.; First check who returns the goods. The refund in (c) is conditional: the return must be proved. In (d), the law treats the return as a supply by the returning registered person. Check the conditions given in the question.
Upward price revision under a pre-GST contract: Price revised upward on or after the appointed day under a contract entered into before it → supplementary invoice or debit note within 30 days of the date of price revision, treated as issued in respect of an outward supply under GST; The rule applies only where the revision is made in terms of a contract entered into before the appointed day and happens on or after it. The 30 days run from the date of price revision.
Downward price revision under a pre-GST contract: Price revised downward on or after the appointed day under a contract entered into before it → credit note within 30 days of the date of price revision; The credit note reduces the supplier's tax liability only if the recipient reduces the ITC taken on that supply to the same extent, as the law provides.
Supply spanning both laws: Section 142(11)(a): no GST is payable on a supply to the extent tax was paid on that supply under the old law. Section 142(11)(b): where tax was paid on a supply under both the old law and GST, the old-law tax is refunded under the old law, and the GST paid stays.; Check what tax was paid on the supply under the old law and under GST. Then apply (a) or (b) to the extent of the tax paid.

Quick revision

The appointed day for GST is 1 July 2017.
Section 142 of the CGST Act, 2017 holds the miscellaneous transitional provisions.
Many pre-GST matters continue to be processed under the existing law.
Refunds allowed under existing law (Section 142(3)) are paid in cash, not as input tax credit.
Refunds arising from proceedings pending under the existing law are paid in cash under the existing law (Section 142(6)(a)). Amounts that become recoverable as a result of those proceedings are recovered as an arrear of tax under GST, unless already recovered under the existing law (Section 142(6)(b)).
In assessment or adjudication proceedings, an amount that becomes recoverable is recovered as an arrear of tax under GST, unless already recovered under the existing law (Section 142(8)(a)). An amount that becomes refundable is paid in cash under the existing law (Section 142(8)(b)). Amounts found recoverable on revision of returns are also recovered as an arrear of tax under GST, unless already recovered under the existing law.
Goods removed before 1 July 2017 and returned within six months of the appointed day by a person other than a registered person: the seller is eligible for a refund of the tax paid under the existing law, subject to conditions such as the goods being identifiable. The Commissioner can extend this period by up to two further months for sufficient cause. If a registered person returns the goods, the return is treated as a supply under GST and tax is payable by the person returning the goods.
Price revision after 1 July 2017 for supplies made before it under a pre-GST contract: for an upward revision, the supplier issues a supplementary invoice or debit note. For a downward revision, the supplier issues a credit note. Each must be issued within 30 days of the price revision. The credit note is effective only if the recipient has also reduced credit or declared the corresponding amount.
Pending assessments, appeals and revisions continue under the existing law. Refunds from them are paid in cash under the existing law.
Always check the date, the party and the stated condition before applying a rule.
Do not apply a general GST rule where Section 142 gives a special one.

Common mistakes

Applying the old Act's terms and rates to a post-appointed-day event. Fix: Decide the law by the date of each event. A price revision or return after 1 July 2017 of a supply made before it is dealt with under Section 142 and GST.
Counting the 6-month window from the date of removal. Fix: Removal must be within 6 months before the appointed day. The return must be within 6 months after the appointed day, that is, by 31 December 2017.

Exam tips

Write the date line first. Placing events on the correct side of 1 July 2017 settles most of the case.
Quote the time limits exactly: 6 months for approval and returned goods (ending 31 December 2017), a 2-month extension on the Commissioner's permission (ending 28 February 2018 at the latest), and 30 days for price revision documents.
In MCQs, check for a return just outside 6 months, an extension that the case never mentions, or a price revision on a supply made after the appointed day.
In written answers, give the rule in words, apply the facts, and end with a clear conclusion on who pays and how much.
For returned goods, always state whether the person returning them is registered, since the result differs.