CBIC Issues Guidelines For Verification Of Transitional Credit: EY Analysis

The Legal Library section collates quality and in-depth reports on regulatory developments, court rulings and policy changes authored by India’s top law firms and consultants. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of law and policy..EY Update.This alert summarises a recent circular issued by the Central Board of Indirect Taxes and Customs. Vide said circular, CBIC has issued guidelines for verification of transitional creditavailed by the taxpayers pursuant to Supreme Court ruling . Earlier, CBIC had clarified on claiming transitional credit through filing/revising TRAN1/TRAN-2 . The guidelines cover the following: Verification of transitional credit shall be conducted by the jurisdictional tax officer.Since the transitional credit claims could contain both central tax and state/union territory tax, jurisdictional central tax officer may refer the claim for verification to his counterpart state/union territory tax officer for verification of such credits and vice versa.Procedure prescribed for verification of transitional credit of central tax by JTO.Post verification, JTO shall pass an order specifying the amount of transitional credit allowed to be transferred to the electronic credit ledger. Verification of transitional credit is to be carried out within 90 days after completion of the two months window, i.e., up to February 28, 2023. Guidelines on verification of transitional credit will bring in consistency and help in avoiding divergent practices being followed at the field formation level. CBIC, in the past, had issued similar internal guidelines for verification of transitional credits vide letter dated March 14, 2018. Both central and state tax authorities were earlier empowered to conduct simultaneous verification of transitional credit which resulted in difficulties for businesses. Present procedure prescribed for such verification is a taxpayer friendly measure and a welcome move..Click on the attachment to read the full report:.DISCLAIMERThis alert does not constitute legal advice and is for information purpose only. This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

CBIC Issues Guidelines For Verification Of Transitional Credit: EY Analysis

Guidelines on verification of transitional credit will bring in consistency, help in avoiding divergent practices being followed

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