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CMA Anil Sharma

Scheme of budgetary support under Goods and Service Tax Regime to the units located in States of Jammu & Kashmir, Uttarakhand, Himachal Pradesh and North East including Sikkim

♠ The new scheme is offered, as a measure of goodwill, only to the units which were eligible for drawing benefits under the earlier excise duty exemption/refund schemes

♠ All such notifications have ceased to apply w.e.f. 01.07.2017 and stands rescinded on 18.07.2017 vide Notification No. 21/2017-Central Excise dated 18.07.2017.

♠ The scheme shall be limited to the tax which accrues to the Central Government under Central Goods and Service Act, 2017 and Integrated Goods and Services Act, 2017, after devolution of the Central tax or the Integrated tax to the States, in terms of Article 270 of the Constitution.

♠ The erstwhile Schemes which were in operation on 18.07.2017 were as follows:

Jammu & KashmirNotification nos. 56/2002-CE dated 14.11.2002, 57/2002-CE dated  14.11.2002 and 01/2010-CE dated 06.02.2010 as amended from time to time

Himachal Pradesh & UttarakhandNotification nos. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 10.06.2003 as amended from time to time;

North East States including Sikkim- Notification no 20/2007-CE dated 25.04.2007 as amended from time to time

♠ ‘Eligible unit’ means a unit which was eligible before 1st day of July, 2017 to avail the benefit of ab-initio exemption or exemption by way of refund from payment of central excise duty under notifications, as the case may be

♠ The eligibility of the unit shall be on the basis of application filed for budgetary support under this scheme with reference to:

♠ Central Excise registration number, for the premises of the eligible manufacturing unit, as it existed prior to migration to GST; or

♠ GST registration for the premises as a place of business, where manufacturing activity under exemption Notification nos. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 10.06.2003 were being carried prior to 01.07.2017 and the unit was not registered under Central Excise

♠ Specified goods’ means the goods specified under exemption notifications, listed above, which were eligible for exemption under the said notifications, and which were being manufactured and cleared by the eligible unit by availing the benefit of excise duty exemption, from:

♠ The premises under Central Excise with a registration number, as it existed prior to migration to GST; or

The manufacturing premises registered in GST as a place of business from where the said goods under exemption Notification nos. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 10.06.2003 were being cleared

♠ ‘Residual period’ means the remaining period out of the total period not exceeding ten years, from the date of commencement of commercial production, as specified under the relevant notification


The amount of budgetary support under the scheme for specified goods manufactured by the eligible unit shall be sum total of –

58% of the Central tax paid through debit in the cash ledger account maintained by the unit under CGST Act, 2017 after utilization of the Input tax credit of the Central Tax and Integrated Tax.

29% of the integrated tax paid through debit in the cash ledger account maintained by the unit under Integrated Goods and Services Act, 2017 after utilization of the Input tax credit Tax of the Central Tax and Integrated Tax.

Provided where inputs are procured from a registered person operating under the Composition Scheme under Section 10 of the Central Goods and Services Act, 2017 the amount i.e. sum total of (i) & (ii) above shall be reduced by the same percentage as is the percentage value of inputs procured under Composition scheme out of total value of inputs procured

♠ Budgetary support under this scheme shall be worked out on quarterly basis for which claims shall be filed on a quarterly basis namely for January to March, April to June, July to September & October to December

♠ The manufacturer applying for benefit under this scheme for the first time shall also file the following documents:

  • the copy of the option filed by the manufacturer with the jurisdictional Deputy Commissioner/ Assistant Commissioner of Central Excise officer at the relevant point of time, for availing the exemption notification issued by the Department of Revenue;
  • document issued by the concerned Director of Industries evidencing the commencement of commercial production
  • the copy of last monthly/quarterly return for production and removal of goods under exemption notification of the Department of Revenue.
  • An Affidavit-cum-indemnity bond to be submitted on one time basis, binding itself to pay the amount repayable.
  • Any other document evidencing the details required in clause (a) to (c) may be accepted with the approval of the Commissioner.

♠ The Budgetary Support under the Scheme shall be allowed to an eligible unit subject to an inspection by a team constituted by DIPP for every State to scrutinize in detail the implementation of the previous schemes

♠ The manufacturer shall file an application for payment of budgetary support for the Tax paid in cash, by the 15th day of the succeeding month after end of quarter after payment of tax relating to the quarter to which the claim relates

♠ The eligible units shall obtain one time registration on the ACES-GST portal and obtain a unique ID which is to be used for all processing of claims under the scheme. The application by the eligible unit for reimbursement of budgetary support shall be filed on the ACES-GST portal with reference to unique ID obtained.

♠ Also ref Circular No. 1060/9/2017-CX  dated 27.11.2017Circular No. 1061/10/2017-CX dated 30.11.2017.

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Practicing Cost Accountant since 2003 at Chandigarh View Full Profile

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April 2024