Rule 40 CGST Rules 2017 : Manner of claiming credit in special circumstances

By | July 13, 2017
(Last Updated On: July 5, 2018)

 Rule 40 CGST Rules 2017

Summary of Rule 40 CGST Rules 2017

( Rule 40 CGST Rules 2017 explains Manner of claiming credit in special circumstances and is covered in Chapter V : Input Tax Credit  : Inserted by the Central Goods and Services Tax (Second Amendment) Rules, 2017, w.e.f. 1-7-2017  Amended by Central Goods and Services Tax (Fifth Amendment) Rules, 2017)

Rule 40 CGST Rules 2017

Manner of claiming credit in special circumstances

40. (1) The input tax credit claimed in accordance with the provisions of sub-section (1) of section 18 on the inputs held in stock or inputs contained in semi-finished or finished goods held in stock, or the credit claimed on capital goods in accordance with the provisions of clauses (c) and (d) of the said sub-section, shall be subject to the following conditions, namely,—

(a)the input tax credit on capital goods, in terms of clauses (c) and (d) of sub-section (1) of section 18, shall be claimed after reducing the tax paid on such capital goods by five percentage points per quarter of a year or part thereof from the date of the invoice or such other documents on which the capital goods were received by the taxable person;
3[(b)the registered person shall within a period of thirty days from the date of becoming eligible to avail the input tax credit under sub-section (1) of section 18, or within such further period as may be extended by the Commissioner by a notification in this behalf, shall make a declaration, electronically, on the common portal in FORM GST ITC-01 to the effect that he is eligible to avail the input tax credit as aforesaid:

Provided that any extension of the time limit notified by the Commissioner of State tax or the Commissioner of Union territory tax shall be deemed to be notified by the Commissioner. [ Note -1 and 2]

(c)the declaration under clause (b) shall clearly specify the details relating to the inputs held in stock or inputs contained in semi-finished or finished goods held in stock, or as the case may be, capital goods—
(i)on the day immediately preceding the date from which he becomes liable to pay tax under the provisions of the Act, in the case of a claim under clause (a) of sub-section (1) of section 18 ;
(ii)on the day immediately preceding the date of the grant of registration, in the case of a claim under clause (b) of sub-section (1) of section 18;
(iii)on the day immediately preceding the date from which he becomes liable to pay tax under section 9, in the case of a claim under clause (c) of sub-section (1) of section 18;
(iv)on the day immediately preceding the date from which the supplies made by the registered person becomes taxable, in the case of a claim under clause (d) of sub-section (1) of section 18;
(d)the details furnished in the declaration under clause (b) shall be duly certified by a practicing chartered accountant or a cost accountant if the aggregate value of the claim on account of Central tax, State tax, Union territory tax and integrated tax exceeds two lakh rupees;
(e)the input tax credit claimed in accordance with the provisions of clauses (c) and (d) of sub-section (1) of section 18 shall be verified with the corresponding details furnished by the corresponding supplier in FORM GSTR-1 or as the case may be, in FORM GSTR- 4, on the common portal.

(2) The amount of credit in the case of supply of capital goods or plant and machinery, for the purposes of sub-section (6) of section 18, shall be calculated by reducing the input tax on the said goods at the rate of five percentage points for every quarter or part thereof from the date of the issue of the invoice for such goods.


Notes on Amendments in Rule 40 CGST Rules 2017

3 Substituted by the Central Goods and Services Tax (Fifth Amendment) Rules, 2017, w.r.e.f. 1-7-2017. Prior to its substitution, clause (b) read as under :

“(b)the registered person shall within a period of thirty days from the date of his becoming eligible to avail the input tax credit under sub-section (1) of section 18 shall make a declaration, electronically, on the common portal in FORM GST ITC-01 to the effect that he is eligible to avail the input tax credit as aforesaid;”
2. Seeks to extend the time limit for filing FORM GST ITC-01 vide Notification No 67/2017 Central Tax dated 21st December, 2017
1  Seeks to extend the time limit for submission of FORM GST ITC-01 by the registered persons who have become eligible during the months of July, 2017, August, 2017 and September, 2017, vide Notification No 44/2017 Central Tax dated 13th October, 2017

 Rule 40 CGST Rules 2017

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2 thoughts on “ Rule 40 CGST Rules 2017 : Manner of claiming credit in special circumstances

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