Around 72 hours before the deadline earlier prescribed, Government yesterday came up with another circular & notification which was in the air for last couple of days & quite needed. Thankfully at least it came to give some relief to a number of taxpayers. Let’s find out, what exactly the circular or notification is prescribed. So as always, sit back, relax & enjoy the write-up!

Broadly, time limit to file GSTR 3B of July 2017 is extended till 28th August 2017. But there are some important points to be noted before taking the new time limit into consideration. These are as below:-

1. The GST TRAN -1 form is set to be available online from 21st August 2017.

2. Registered persons entitled to avail input tax credit in terms of section 140 of CGST Act may opt to file GST TRAN 1 on or before 28th August 2017, in order to get the transition credit.

3. Those who are opting to file TRAN 1 by August 28, may file GSTR 3B by the said date as well.

4. However this extended date is not available to those, who are not opting out to file GST TRAN 1 by August 28, 2017. For them, due date to file GSTR 3B for July 17 remains same as before, i.e. 20th August 2017.

5. Those who are opting out to file TRAN 1 by August 28, must compute approximate tax payable in cash after adjusting transition credit as per the GST TRAN 1 form & deposit the same by 20th Yes, even if GSTR 3B is getting filed on or before 28th August.

6. After paying the tax in cash, if it is found that, liability for July 17 is more than the credit & cash available in electronic ledger, then registered person must pay the differential amount in cash along with the applicable interest calculated from the 21st August, 2017 till the date of such deposit.

Though a part of the taxpayers may opt for this small window given, but for some tax persons following might be a challenge to opt for this:-

1. There is a huge chance of mistake if GST TRAN 1 data required to be finalised in such a short time, inviting unnecessary litigation in future.

2. Once GST TRAN1 form is filed, revision of the same is not provided till date. In case, pending C form, H form comes afterwards, difficulties may come to accommodate all these forms, as GST TRAN 1 is already filed.

3. GST TRAN 1 is not only deals with credit, but also deals with details of material lying with Job worker. The similar declaration job worker is also required to give in same form in order to avoid future tax liability. Due to very small window, practical issues may come to file those details

4. What about reaming transition credit? It may happen that, after filing GST TRAN 1 some service tax invoices have come to accommodate the transition credit, even credit document may also come for Excise or VAT. May be, the document for these cases were stuck in the hand of different agency in a large scale company. Filling TRAN 1 in august may come as hurdle as one cannot take these credits anymore once TRAN 1 is filed.

5. Large companies may have 5, 10 or even 15 additional places of business registered in a state. If that GSTIN person wanted to file TRAN 1, it is required to ensure data of all the places of business is ready before filling TRAN 1. So chances of loosing credit can’t be ruled out, if in a hurry somebody missed out this small part. Consult with your sister units/shared service units whether they are ready with TRAN 1 data or not

So, while the circular/notification was much needed, the way the author looks it, notification/ circular may not be that much useful to certain taxpayers.  Hence, think twice before you take any decision, because it will be absolutely critical few months down the line, when scrutiny will come for GST TRAN 1 form.

Author Pralay Chakraborty is a GST Professional & can be reached at 9705941371, [email protected] . Feedbacks are welcome!

Disclaimer: The contents of this document are solely for informational purpose. It does not constitute professional advice or a formal recommendation. While due care has been taken in preparing the document, the existence of mistakes & omissions herein are not ruled out. The author does not accept any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon. No part of this document should be distributed or copied without express written permission of the author.  

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One Comment

  1. ramesh says:

    Dear Sir,

    I had read your article regarding extension of due date for those who are having transtitional ITC .

    I had an different situation. Under state VAT law i had won an appeal and consequently a sum of rupees six lakhs is due to me from the department. For the past two months i am not payiing any VAT but reducing the tax from this refund due amount..
    Is there any place in the said TRN 1 for this type of amounts. what should i do? please give clarification

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October 2021