Transitional provision under GST-Section 140

Whenever a new law is implemented there is also a parallel phase which talks, that how & what will be the treatment of carry forward of input credit benefits prevailing in existing regime. This issues under GST will be taken care by Transitional provision.

These provisions are covered u/s 140 of CGST Act.

The provision describe, how the input credit benefit of existing regime can be claimed under GST by all the businesses.

1. Sec 140(1) is for manufacturers only: All the manufacturers who were allowed credit in existing regime & such credit is admissible in GST Act too shall avail the credit under this section.

However the manufacturer should have filed the return for last 6 months from the appointment date to avail the benefit.

2.  Sec 140(2) is for Capital goods CENVAT credit: That proportion of CENVAT credit for capital goods, which was not availed & not carried forward in return.

3. Sec 140(3) is for credit of eligible taxes held in stock: This section is for all the businesses but essentially for traders who were not eligible to claim credit of excise duty, CVD, SAD & Service tax. This is on the fulfillment of following conditions:

Conditions to be fulfilled

  1.  Such Inputs or Goods are used or intended to be used for making taxable supplies;
  2.  Eligibility of credit on such inputs under this Act;
  3.  Possession of invoice/ documentary evidence of duty paid under existing law;
  4.  Such invoice/ documentary evidence was issued not earlier than 12 months immediately preceding the    appointed day;
  5. The supplier of services is not eligible for any abatement under the GST law.

4. Sec 140(4) is for credit of inputs held in stock in certain situations :

A registered person who was engaged in manufacture of taxable/ exempted goods or providing taxable/ exempted services, but which are liable to tax under current Act shall be entitled to take credit-

  1. Cenvat credit c/f in his return [as per sec 140(1)]; and
  2. Cenvat credit of eligible duty in respect of inputs-relating to exempted goods or services [as per Sec 140(3)]

5. Sec 140(5) is about credit of input taxes in respect of goods & services which are in transit

A registered person-

  1.  Shall be entitled to take credit of eligible duties and taxes
  2.  In respect of inputs/ input services received on or after the appointed day
  3.  The duty or tax is paid before the appointed day
  4.  Provided the invoice is recorded within 30 days from the appointed day, and
  5.  A statement is also required be furnished in respect of such credit.

6. Sec 140(6) is for dealers who want to switch from composition scheme to GST. Such dealers shall also be allowed the credit on fulfillment of following condition for all the category of goods held in stock on the appointed day:

Conditions to be fulfilled

  1.  Inputs/Goods used for making taxable supplies under GST Act;
  2.  Registered Person is not paying tax under composition scheme of GST Act;
  3.  Registered Person is Eligible for ITC under GST Act;
  4.  Possession of invoices;
  5.  Invoices were issued not earlier than 12 months immediately preceding the appointed day

7. Sec 140(7) is for Input Service Distributor where it has received the services before the appointed date, even if invoices are received later on.

8. Sec 140(8) is for registered person having centralized registration under existing laws is allowed to take credit of CENVAT.

Conditions to be fulfilled

  1. Amt. of Cenvat credit shall be amount carried forward in a return furnished for the period ending with day immediately preceding the appointed day.
  2. If such return is furnished within 3 months of the appointed day, then credit shall be allowed only if such return is an original or revised return where the credit has been reduced from that claimed earlier.
  3. Credit allowed only if admissible under GST Act.
  4. Such credit may be transferred to other registered persons having same PAN.

There are formats for Transitional Provisions called as Transition Formats used to carry forward & avail the credit of existing regime.

The formats are captured in the link below

References for Transitional Provision

Link for Credit Transfer Document




Step by Step Guide for GST migration from existing taxation

Step by Step Guide to GST Migration from existing Service Tax, VAT and Central Excise Assessee:

  1. Logon to Aces/VAT portal using the existing ACES/VAT User ID and Password.
  2. Follow the link there to view your Provisional ID & Password to access GSTN common portal. If you have not received any provisional ID & pwd. then please click on the registration tab & further click on GST login credentials.
  3. Make a note of provisional id & password that is provided & proceed further to the GST common portal for final registration.
  4. During final registration, be ready with following info. else you have to face the pain of repeating the process by login as the window login activation time is very short. The info is as follows:-
    • Valid E mail Id
    • Valid mobile no.
    • Bank Account no.
    • Bank IFSC
    • Proof of Constitution of Business (Partnership Deed, Company  RC for Pvt. / Public Ltd. Company)- Mind size of file should be maximum 1 MB (only PDF & JPEG only).
    • Photograph of Proprietor, Promoter etc. – Size Maximum 100 KB (Only PDF & JPEG only).
    • Proof of Appointment of Authorized  Signatory ( Extracts of Minutes in case of  Company , Partnership Deed & RC in case of proprietorship).- Size Maximum 1 MB (Only PDF & JPEG only).
    • Opening page of Bank Statement of company which should capture address.- Size Maximum 1 MB (Only PDF & JPEG only).
  5. Once these details are satisfactory an ARN No. (Application Reference No.) will be issued and the status of Provisional Id will be changed to Migrated till appointed date
  6. On the implementation date of GST (i.e. appointed date), the provisional id status will be changed to “Active” and a provisional RC will be issued.

We are happy to share our services in GST Migration process.

Here are few of the latest challenges during GST Migration process & there solutions:-

1. I am an existing PAN-based Service Tax , Central Excise and State VAT assessee. I received the Provisional ID and password from the State VAT. While migrating to GST through VAT on the GST Common Portal, I did not add my ST and CE details in the Enrolment Application.

Solution: In this scenario the assessee who has missed registering during time of seeking original migration & have submitted the final registration by digitally signing, can now add or remove other registrations in the enrollment application only after the appointed date (i.e. date of implementation of GST) through the process of amendment.

2. I am an existing PAN- based Service Tax assessee, & wish to enroll in GST, having multiple registered business premises in different states from where services are provided. I have not received the provisional IDs & Passwords for all the different states.

Solution: In case of such assessee centralized registration captures address details of the assesses registered business premises in a state, as well as captures the branches details in different states from where services are provided. As a policy these assessee are issued one provisional ID and Password for each State.

3. I am an existing tax payer and wish to enroll in GST. For migrating to GST, I created a new username and password on the GST common portal. However I have forgotten the username/ password, created. When I tried to create a new username / password, I received the message “Provisional ID entered is already mapped to a user. Kindly map it with a valid username.

Solution: In this scenario please seek assistance of GST helpdesk at or call at  0124-4688999.

4. I am an existing taxpayer and wish to enroll in GST. For enrolment under GST, I want to create a new username and password. However, I have not received the OTP which is required to proceed further for seeking final registration. The problem  continued even   during resend buttons.

Solutions: There can be scenario of your mobile number registered for DND. Kindly de-activate the DND & then try again. Else please contact the GST Helpdesk at 0124-4688999.

GST Migration Conclusion

Therefore we believe that those who are already registered in current tax regime, its an easy process to GST Migration by following above simple steps. On completion, a provisional GST No. will be allocated which can be shared with clients.

Reference for GST Migration