CGST Act · Chapter XX
Transitional Provisions
s. 139Migration of taxpayers
Section 139 moved existing taxpayers into GST without fresh applications: anyone registered under the old laws with a valid PAN received a provisional registration on 1 July 2017.
- Under section 139(1) of the CGST Act, 2017 every person registered under an existing law with a valid PAN was issued a provisional registration certificate from the appointed day (01.07.2017).
- The final certificate followed on furnishing prescribed information (section 139(2), Rule 24); a provisional registration cancelled on the person's application is deemed never issued (section 139(3)).
s. 140Transitional ITC
Section 140 carried the credit of the old regime into GST: closing CENVAT balances, credit on capital goods not fully availed, and credit on stock held on 30 June 2017. The deadline for claiming it, and a defective portal, produced extensive litigation, which the Supreme Court resolved in 2022 by ordering the portal reopened for all taxpayers.
- Under section 140(1) of the CGST Act, 2017 a registered person (other than a composition taxpayer) could carry forward the CENVAT credit of eligible duties in its last return under the existing law, if admissible under both laws.
- Sub-sections (2) to (4) allowed credit of unavailed CENVAT on capital goods and of duties on inputs held in stock (including in semi-finished and finished goods) by persons not previously entitled to full credit; sub-section (5) covered goods and services in transit.
- The Finance Act, 2020 inserted "within such time and in such manner as may be prescribed" retrospectively from 01.07.2017, validating the time limit for Form TRAN-1 (Rule 117).
- In Union of India v Filco Trade Centre (2022) the Supreme Court directed the portal to be reopened from 01.09.2022 to 31.10.2022 for all aggrieved registered persons to file or revise TRAN-1 and TRAN-2, with claims to be verified on merits.
- Cesses not listed in Explanations 1 and 2 — such as Krishi Kalyan Cess and education cesses — are not "eligible duties" (Explanation 3).
s. 141Job work transition
Section 141 handled goods that were with job workers when GST began. If they came back within six months, no GST was payable on their return.
- Under section 141 of the CGST Act, 2017 no tax is payable on inputs, semi-finished goods or excisable goods sent to a job worker or other premises under the existing law before the appointed day, if they are returned within six months (extendable by up to two months).
- If not returned in time, credit is recoverable, or tax is payable, as the section provides.
- The exemption applies only if the details of goods held by the job worker were declared (section 141(4); Form TRAN-1).
s. 142Miscellaneous transitional
Section 142 deals with the loose ends of the change to GST: what happens to refunds, appeals, assessments and price revisions under the old laws, and how contracts that straddle 1 July 2017 are taxed.
- Under section 142 of the CGST Act, 2017 refunds, appeals, revisions and assessments under the existing laws continue to be decided under those laws; amounts found refundable are paid in cash, and amounts recoverable are recovered as arrears under GST (section 142(3)–(9)).
- Supplementary invoices and credit notes for price revisions of pre-GST contracts are issued under GST within thirty days (section 142(2)).
- Supplies made on or after 01.07.2017 under earlier contracts are taxable under GST (section 142(10)); tax paid under VAT or service tax on supplies made after 01.07.2017 is creditable or excluded to avoid double taxation (section 142(11)).
- Rejected CENVAT refund claims lapse and cannot be carried forward as credit (provisos to section 142(3) and (6)).