CBIC clarifies the meaning of expression “eligible duties” for the purpose of transitional credit
Central Board of Indirect Taxes and Customs (CBIC) has issued Circular No. 87/06/2019- GST dated 2nd January, 2019 to clarify doubts on whether the expression “eligible duties” would include CENVAT credit of Service Tax for the purpose of transitional credit since CGST (Amendment) Act, 2018 allows transition of CENVAT credit under the existing law viz. Central Excise and Service Tax law, only in respect of “eligible duties” with retrospective effect.
CBIC has clarified that the CENVAT credit of service tax paid under section 66B of the Finance Act, 1994 was available as transitional credit under section 140(1) of the CGST Act and that legal position has not changed due to amendment of section 140(1).
It’s been further clarified that no transition of credit of cesses, including cess which is collected as additional duty of customs under sub-section (1) of section 3 of the Customs Tariff Act, 1975, would be allowed in terms of CGST Amendment Act, 2018 which shall become effective from the date the same is notified giving it retrospective effect.
For further information please refer the attached document.
Source: Central Board of Indirect Taxes & Customs