Section 18 of IGST Act 2017: Transfer of Input Tax Credit (ITC)

Provisions under Section 18 of the Integrated Goods and Services Tax (IGST) Act, 2017 relating to “Transfer of Input Tax Credit (ITC)”, are as under:

Section 18 of IGST Act 2017: Transfer of Input Tax Credit (CHAPTER VIII – APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS)

On utilisation of credit of integrated tax availed under this Act for payment of,–

(a) central tax in accordance with the provisions of sub-section (5) of section 49 of the Central Goods and Services Tax Act, the amount collected as integrated tax shall stand reduced by an amount equal to the credit so utilised and the Central Government shall transfer an amount equal to the amount so reduced from the integrated tax account to the central tax account in such manner and within such time as may be prescribed;

(b) Union territory tax in accordance with the provisions of section 9 of the Union Territory Goods and Services Tax Act, the amount collected as integrated tax shall stand reduced by an amount equal to the credit so utilised and the Central Government shall transfer an amount equal to the amount so reduced from the integrated tax account to the Union territory tax account in such manner and within such time as may be prescribed;

(c) State tax in accordance with the provisions of the respective State Goods and Services Tax Act, the amount collected as integrated tax shall stand reduced by an amount equal to the credit so utilised and shall be apportioned to the appropriate State Government and the Central Government shall transfer the amount so apportioned to the account of the appropriate State Government in such manner and within such time as may be prescribed.

Explanation: For the purposes of this Chapter, “appropriate State” in relation to a taxable person, means the State or Union territory where he is registered or is liable to be registered under the provisions of the Central Goods and Services Tax Act.

Amendments History:

1. CBEC notifies 1st July 2017 as the Commencement date for Section 18 of the IGST Act 2017, vide Notification 3/2017 Integrated Tax.

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Govt. has notified the Integrated Goods and Services Tax (IGST) Act, 2017 on 12 April, 2017, followed with Integrated Goods and Services Tax (IGST) (Amendment) Act, 2018 on 30 Aug. 2018. CBEC/ CBIC has subsequently issued various Notifications on commencement date of various Sections/ Provisions of the IGST/ Amendment Acts from time to time, except where specifically mentioned in the respective IGST/ Amendment Acts.

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