There has been considerable debate on several matters regarding what to do with Closing Stock, to buy goods today or to decrease the quantity of goods to be bought. There are vague answers floating on the web and through word of mouth. Today, we will discuss these questions and offer simple and straightforward answers.

1. To begin with, create a Stock Register if you haven't made one yet.

2. Verify the Quantity mentioned in the Stock Register with the actual Quantity in the godown. Also, check if the stock mentioned in the Actual Stock and Books of Account match. In case on inconsistency, match the figures within the month of June and seek assistance from your CA or tax advisor regarding what to do with the difference.

3. It is often seen that businessmen do not declare information of all godowns in the Registration Certificate of VAT. And they do the same during migration to GST. If there is stock in godowns, mention that in VAT and GST. One benefit that you will get out of it is that there aren't as many documents requested for migration as you will have to submit during registration. You can submit those during amendment when asked for.

4. In GST, tax will be levied on Supply and not on Sale. If you have registration in separate states, then each of the registrations will be considered a distinct person. For this reason, if Stock Transfer is made from one state to another, GST will be levied on supply.

5. If you are registered in Service Tax, Excise or VAT, then the CENVAT Credit of returned filed on 30/6/2017 will be carried forward and you will get its credit within GST. However, you will not be able to take advantage of the credit unless you have complied with all process you have to mandatorily go follow. It won't matter how much stock for which credit can be availed, is mentioned in books.

6. There must be a genuine reason you are registered in VAT but not in Excise, but GST shall be levied on goods in such a case as well. If you have goods in possession since 30/6/2017 or before, check how old they are. Also, here is what will happen if you are not able to obtain Batchwise details and whether you have Excise Invoice or not:

a) You won't receive any credit if goods are more than a year old

b) if goods are less than a year old and you have Excise Invoice, then you will receive full credit even though CGST would be less. There is no specified time-frame as such for the sale of goods.

c) if goods are less than a year old but Excise Invoice is not available, then you will receive only 40% of the credit. This credit will be given only after sale of the goods. Here, it is mandatory to submit CGST, and the goods have to be necessarily supplied within 6 months.

I understand that there are a lot of things that still need to be answered and that there must be more questions in your mind. Since it is not practically possible to take up all of them in a limited space, I will try to cover other questions in my next article.

It has always been our effort to address your queries. We have started a new scheme keeping in mind your concerns regarding Due Date, penalty on delays in filing return, and almost everything that is related to GST.

Getting answers is real quick. You don't even have to register. Just give us a missed call and we will immediately get back to you.