THE UNION TERRITORY GOODS AND SERVICES TAX ACT, 2017 

ARRANGEMENT OF SECTIONS 

CHAPTER I 
PRELIMINARY 

SECTIONS 

1. Short title, extent and commencement. 

2. Definitions. 

CHAPTER II 
ADMINISTRATION 

3. Officers under this Act. 

4. Authorisation of officers. 

5. Powers of officers. 

6. Authorisation of officers of central tax as proper officer in certain circumstances. 

CHAPTER III 
LEVY AND COLLECTION OF TAX 

7. Levy and collection. 

8. Power to grant exemption from tax. 

CHAPTER IV 
PAYMENT OF TAX 

9. Payment of tax. 

9A. Utilisation of input tax credit. 

9B. Order of utilisation of input tax credit. 

10. Transfer of input tax credit. 

CHAPTER V 
INSPECTION, SEARCH, SEIZURE AND ARREST 

11. Officers required to assist proper officers. 

CHAPTER VI 
DEMANDS AND RECOVERY 

12. Tax wrongfully collected and paid to Central Government or Union territory Government. 

13.  Recovery of tax. 

14.  Definitions. 

CHAPTER VII 
ADVANCE RULING 

15. Constitution of Authority for Advance Ruling. 

16. Constitution of Appellate Authority for Advance Ruling. 

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SECTIONS 

CHAPTER VIII 
TRANSITIONAL PROVISIONS 

17. Migration of existing tax payers. 

18. Transitional arrangements for input tax credit. 

19. Transitional provisions relating to job work. 

20.  Miscellaneous transitional provisions. 

CHAPTER IX 
MISCELLANEOUS 

21. Application of provisions of Central Goods and Services Tax Act. 

22. Power to make rules. 

23. General power to make regulations. 

24. Laying of rules, regulations and notifications. 

25. Power to issue instructions or directions. 

26. Removal of difficulties. 

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THE UNION TERRITORY GOODS AND SERVICES TAX ACT, 2017 

ACT NO. 14 OF 2017 

An Act to make a provision for levy and collection of tax on intra-State supply of goods or services or 

both by the Union territories and for matters connected therewith or incidental thereto. 

BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as follows:— 

[12th April, 2017.] 

CHAPTER I 

PRELIMINARY 

1. Short title, extent and commencement.—(1) This Act may be called the Union Territory Goods and 

Services Tax Act, 2017. 

(2) It extends to the Union territories of the Andaman and Nicobar Islands, Lakshadweep, 1[Dadra 

and Nagar Haveli, Daman and Diu, Ladakh], Chandigarh and other territory. 

(3)  It shall come into force on such date2 as the Central Government may, by notification in the 

Official Gazette, appoint: 

Provided that different dates may be appointed for different provisions of this Act and any reference 
in any such provision to the commencement of this Act shall be construed as a reference to the coming 
into force of that provision. 

2. Definitions.—In this Act, unless the context otherwise requires,— 

(1) “appointed day” means the date on which the provisions of this Act shall come into force; 

(2) “Commissioner” means the Commissioner of Union territory tax appointed under section 3; 

(3) “designated authority” means such authority as may be notified by the Commissioner; 

(4) “exempt supply” means supply of any goods or services or both which attracts nil rate of tax 
or  which  may  be  exempt  from  tax  under  section  8,  or  under section  6 of the  Integrated  Goods  and 
Services Tax Act, and includes non-taxable supply; 

(5)  “existing  law”  means  any  law,  notification,  order,  rule  or  regulation  relating  to  levy  and 
collection of duty or tax on goods or services or both passed or made before the commencement of 
this Act by Parliament or any Authority or person having the power to make such law, notification, 
order, rule or regulation; 

(6)  “Government”  means  the  Administrator  or  any  Authority  or  officer  authorised  to  act  as 

Administrator by the Central Government; 

(7) “output tax” in relation to a taxable person, means the Union territory tax chargeable under 
this Act on taxable supply of goods or services or both made by him or by his agent but excludes tax 
payable by him on reverse charge basis; 

(8) “Union territory” means the territory of,— 

(i) the Andaman and Nicobar Islands; 

(ii) Lakshadweep; 
3[(iii) Dadra and Nagar Haveli and Daman and Diu; 
(iv) Ladakh;] 

(v) Chandigarh; or 

(vi) other territory. 

 1. Subs. by Act 12 of 2020, s. 136, for “Dadra and Nagar Haveli, Daman and Diu” (w.e.f. 27-3-2020). 
2. 22nd, June, 2017  for  sections 1, 2, 3,4,5, 17, 21 and 22  vide notification  No.  G.S.R. 616(E) dated  the 21st June,  2017,  see 
Gazette of India, Extraordinary, Part II, sec. 3(i). 
1st July, 2017 for sections 6 to 16, 18 to 20 and 23 to 26 vide notification No. G.S.R. 701(E) dated the 28th June, 2017, see 
Gazette of India, Extraordinary, Part II, sec. 3(i) 
3. Subs. by Act 12 of 2020, s. 137, for sub-clauses (iii) and (iv) (w.e.f. 27-3-2020). 

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Explanation.—For the purposes of this Act, each of the territories specified in sub-clauses (i) to (vi) 

shall be considered to be a separate Union territory; 

(9) “Union territory tax” means the tax levied under this Act; 

(10) words and expressions used and not defined in this Act but defined in the Central Goods and 
Services Tax Act, the Integrated Goods and Services Tax Act, the State Goods and Services Tax Act, and 
the Goods and Services Tax (Compensation to States) Act, shall have the same meaning as assigned to 
them in those Acts. 

CHAPTER II 
ADMINISTRATION 

3. Officers under this Act.—The Administrator may, by notification, appoint Commissioners and such 
other class of officers as may be required for carrying out the purposes of this Act and such officers shall be 
deemed to be proper officers for such purposes as may be specified therein: 

Provided  that  the  officers  appointed  under  the  existing  law  shall  be  deemed  to  be  the  officers 

appointed under the provisions of this Act. 

4.  Authorisation  of  officers.—The  Administrator  may,  by  order,  authorise  any  officer  to  appoint 
officers  of  Union  territory tax  below the rank  of  Assistant  Commissioner of  Union  territory  tax for  the 
administration of this Act. 

5.  Powers  of  officers.—(1)  Subject  to  such  conditions  and  limitations  as  the  Commissioner  may 
impose, an officer of the Union territory tax may exercise the powers and discharge the duties conferred 
or imposed on him under this Act. 

(2) An officer of a Union territory tax may exercise the powers and discharge the duties conferred or 

imposed under this Act on any other officer of a Union territory tax who is subordinate to him. 

(3) The Commissioner may, subject to such conditions and limitations as may be specified in this behalf 

by him, delegate his powers to any other officer subordinate to him. 

(4) Notwithstanding anything contained in this section, an Appellate Authority shall not exercise the 

powers and discharge the duties conferred or imposed on any other officer of Union territory tax. 

6. Authorisation of officers of central tax as proper officer in certain circumstances.—(1) Without 
prejudice to the provisions of this Act, the officers appointed under the Central Goods and Services Tax Act 
are  authorised  to  be  the  proper  officers  for  the  purposes  of  this  Act,  subject  to  such  conditions  as  the 
Government shall, on the recommendations of the Council, by notification, specify. 

(2) Subject to the conditions specified in the notification issued under sub-section (1),— 

(a) where any proper officer issues an order under this Act, he shall also issue an order under the 
Central  Goods  and  Services  Tax  Act,  as  authorised  by  the  said  Act  under  intimation  to  the 
jurisdictional officer of central tax; 

(b)  where  a  proper  officer  under  the  Central  Goods  and  Services  Tax  Act  has  initiated  any 
proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act 
on the same subject matter. 

(3) Any proceedings for rectification, appeal and revision, wherever applicable, of any order passed 
by an officer appointed under this Act, shall not lie before an officer appointed under the Central Goods 
and Services Tax Act. 

CHAPTER III 
LEVY AND COLLECTION OF TAX 

7.  Levy  and  collection.—(1)  Subject  to  the  provisions  of  sub-section  (2),  there  shall  be  levied  a  tax 
called the Union territory tax on all intra-State supplies of goods or services or both, except on the supply of 
alcoholic liquor for human consumption, on the value determined under section 15 of the Central Goods and 
Services Tax Act and at such rates, not exceeding twenty per cent., as may be notified by the Central 

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Government on the recommendations of the Council and collected in such manner as may be prescribed and 
shall be paid by the taxable person. 

(2) The Union territory tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly 
known as petrol), natural gas and aviation turbine fuel shall be levied with effect from such date as may be 
notified by the Central Government on the recommendations of the Council. 

(3)  The  Central  Government  may,  on  the  recommendations  of  the  Council,  by  notification,  specify 
categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis 
by the recipient of such goods or services or both and all the provisions of this Act shall apply to such 
recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services 
or both. 

1[(4) The Government may, on the recommendations of the Council, by notification, specify a class of 
registered  persons  who  shall,  in  respect  of  supply  of  specified  categories  of  goods  or  services  or  both 
received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply 
of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the 
person liable for paying the tax in relation to such supply of goods or services or both.] 

(5)  The  Central  Government  may,  on  the  recommendations  of  the  Council,  by  notification,  specify 
categories of services the tax  on intra-State supplies of which shall be paid by the electronic commerce 
operator  if  such  services  are  supplied  through  it,  and  all  the  provisions  of  this  Act  shall  apply  to  such 
electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of 
such services: 

Provided  that  where  an  electronic  commerce  operator  does  not  have  a  physical  presence  in  the 
taxable  territory,  any  person  representing  such  electronic  commerce  operator  for  any  purpose  in  the 
taxable territory shall be liable to pay tax: 

Provided further that where an electronic commerce operator does not have a physical presence in 
the  taxable  territory  and  also  he  does  not  have  a  representative  in  the  said  territory,  such  electronic 
commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such 
person shall be liable to pay tax. 

8.  Power  to  grant  exemption  from  tax.—(1) Where the Central Government is satisfied that it is 
necessary in the public interest so to do, it may, on the recommendations of the Council, by notification, 
exempt  generally  either  absolutely  or  subject  to  such  conditions  as  may  be  specified  therein,  goods  or 
services or both of any specified description from the whole or any part of the tax leviable thereon with 
effect from such date as may be specified in such notification. 

(2) Where the  Central  Government  is satisfied that  it is necessary  in the public  interest so to  do,  it 
may, on the recommendations of the Council, by special order in each case, under circumstances of an 
exceptional nature to be stated in such order, exempt from payment of tax any goods or services or both 
on which tax is leviable. 

(3) The Central Government may, if it considers necessary or expedient so to do for the purpose of 
clarifying the scope or applicability of any notification issued under sub-section (1) or order issued under 
sub-section (2), insert an explanation in such notification or order, as the case may be, by notification at 
any time within one year of issue of the notification under sub-section (1) or order under sub-section (2), 
and every such explanation shall have effect as if it had always been the part of the first such notification 
or order, as the case may be. 

(4) Any notification issued by the Central Government under sub-section (1) of section 11 or order 
issued  under  sub-section  (2)  of  the  said  section  of  the  Central  Goods  and  Services  Tax  Act  shall  be 
deemed to be a notification or, as the case may be, an order issued under this Act. 

1. Subs. by Act 33 of 2018, s. 2 for sub-section (4) (w.e.f. 1-2-2019) 

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Explanation.—For the purposes of this section, where an exemption in respect of any goods or services 
or both from the whole or part of the tax leviable thereon has been granted absolutely, the registered person 
supplying such goods or services or both shall not collect the tax, in excess of the effective rate, on such 
supply of goods or services or both. 

CHAPTER IV 
PAYMENT OF TAX 

9.  Payment  of  tax.—The  amount  of  input  tax  credit  available  in  the  electronic  credit  ledger  of  the 

registered person on account of,— 

(a)  integrated  tax  shall  first  be  utilised  towards  payment  of  integrated  tax  and  the  amount 
remaining, if any, may be utilised towards the payment of central tax and State tax, or as the case may 
be, Union territory tax, in that order; 

(b) the Union territory tax shall first be utilised towards payment of Union territory tax and the 

amount remaining, if any, may be utilised towards payment of integrated tax: 

1[Provided  that  the  input  tax  credit  on  account  of  Union  territory  tax  shall  be  utilised  towards 
payment of integrated tax only where the balance of the input tax credit on account of central tax is 
not available for payment of integrated tax.]; 

(c) the Union territory tax shall not be utilised towards payment of central tax. 

2[9A.  Utilisation  of  input tax    credit.—Notwithstanding anything contained in section 9, the input 
tax credit on account of Union territory tax shall be utilised towards payment of integrated tax or Union 
territory tax, as the case may be, only after the input tax credit available on account of integrated tax has 
first been utilised towards such payment. 

9B. Order of utilisation of input tax credit.—Notwithstanding anything contained in this Chapter 
and subject to the provisions of clause (c) of section 9, the Government may, on the recommendations of 
the Council, prescribe the order and manner of utilisation of the input tax credit on account of integrated 
tax, Central tax, State tax or Union territory tax, as the case may be, towards payment of any such tax.] 

10. Transfer of input tax credit.—On utilisation of input tax credit of Union territory tax for payment 
of  tax  dues  under  the  Integrated  Goods  and  Services  Tax  Act  in  accordance  with  the  provisions  of  sub- 
section  (5)  of  section  49  of  the  Central  Goods  and  Services  Tax  Act,  as  reflected  in  the  valid  return  
furnished  under  sub-section  (1)  of  section  39  of  the  Central  Goods  and  Services  Tax  Act,  the  amount 
collected as Union territory  tax  shall stand  reduced by  an  amount equal to  such  credit so  utilised and the 
Central Government shall transfer an amount equal to the amount so reduced from the Union territory tax 
account to the integrated tax account in such manner and within such time as may be prescribed. 

CHAPTER V 

INSPECTION, SEARCH, SEIZURE AND ARREST 

11. Officers required to assist proper officers.—(1) All officers of Police, Railways, Customs, and 
those officers engaged in the collection of land revenue, including village officers, and officers of central 
tax and officers of the State tax shall assist the proper officers in the implementation of this Act. 

(2) The Government may, by notification, empower and require any other class of officers to assist 

the proper officers in the implementation of this Act when called upon to do so by the Commissioner. 

1. The proviso ins. by Act 33 of 2018, s. 3 (w.e.f. 1-2-2019) 
2. Ins. by s. 4, ibid., (w.e.f. 1-2-2019) 

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CHAPTER VI 
DEMANDS AND RECOVERY 

12.  Tax  wrongfully  collected  and  paid  to  Central  Government  or  Union  territory 
Government.—(1)  A  registered  person  who  has  paid  the  central  tax  and  the  Union  territory  tax  on  a 
transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter- 
State supply, shall be refunded the amount of taxes so paid in such manner and subject to such conditions 
as may be prescribed. 

(2) A registered person who has paid integrated tax on a transaction considered by him to be an inter- 
State supply, but which is subsequently held to be an intra-State supply, shall not be required to pay any 
interest on the amount of the central tax and the Union territory tax payable. 

13.  Recovery of tax.—(1) Where any amount of tax, interest or penalty is payable by a person to the 
Government  under  any  of  the  provisions  of  this  Act  or  the  rules  made  thereunder  and  which  remains 
unpaid, the proper officer of central tax, during the course of recovery of said tax arrears, may recover the 
amount from the said person as if it were an arrear of central tax and credit the amount so recovered to the 
account of the Government under the appropriate head of Union territory tax. 

(2) Where the amount recovered under sub-section (1) is less than the amount due to the Government 
under this Act and the Central Goods and Services Tax Act, the amount to be credited to the account of 
the Government shall be in proportion to the amount due as Union territory tax and central tax. 

CHAPTER VII 
ADVANCE RULING 

14. Definitions.—In this Chapter, unless the context otherwise requires,— 

(a)  “advance  ruling”  means  a  decision  provided  by  the  Authority  or  the  Appellate  Authority  to  an 
applicant  on  matters  or  on  questions  specified  in  sub-section  (2)  of  section  97  or  sub-section    (1)    of  
section 100 of the Central Goods and Services Tax Act, in relation to the supply of goods or services or 
both being undertaken or proposed to be undertaken by the applicant; 

(b)  “Appellate Authority” means the Appellate Authority for Advance Ruling constituted under 

section 16; 

(c) “applicant” means any person registered or desirous of obtaining registration under this Act; 

(d) “application” means an application made to the Authority under sub-section (1) of section 97 

of the Central Goods and Services Tax Act; 

(e) “Authority” means the Authority for Advance Ruling, constituted under section 15. 

15.  Constitution  of  Authority  for  Advance  Ruling.—(1)  The  Central  Government  shall,  by 
notification,  constitute  an  Authority  to  be  known  as  the  (name  of  the  Union  territory)  Authority  for 
Advance Ruling: 

Provided  that  the  Central  Government  may,  on  the  recommendations  of  the  Council,  notify  any 
Authority located in any State or any other Union territory to act as the Authority for the purposes of this 
Act. 

(2) The Authority shall consist of— 

(i) one member from amongst the officers of central tax; and 

(ii) one member from amongst the officers of Union territory tax, 

to be appointed by the Central Government. 

(3) The qualifications, the  method  of  appointment  of the  members  and  the terms  and  conditions  of 

their service shall be such as may be prescribed. 

16. Constitution of Appellate Authority for Advance Ruling. — (1) The Central Government shall, 
by notification, constitute an Appellate Authority to be known as the (name of the Union territory) Appellate 

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Authority for Advance Ruling for Goods and Services Tax for hearing appeals against the advance ruling 
pronounced by the Advance Ruling Authority: 

Provided  that  the  Central  Government  may,  on  the  recommendations  of  the  Council,  notify  any 
Appellate Authority located in any State or any other Union territory to act as the Appellate Authority for 
the purposes of this Act. 

(2) The Appellate Authority shall consist of— 

(i) the Chief Commissioner of central tax as designated by the Board; and 

(ii) the Commissioner of Union territory tax having jurisdiction over the applicant. 

CHAPTER VIII 

TRANSITIONAL PROVISIONS 

17. Migration of existing tax payers.—(1) On and from the appointed day, every person registered 
under any of the existing laws and having a valid Permanent Account Number shall be issued a certificate 
of registration on provisional basis, subject to such conditions and in such form and manner as may be 
prescribed, which unless replaced by a final certificate of registration under sub-section (2), shall be liable 
to be cancelled if the conditions so prescribed are not complied with. 

(2) The final certificate of registration shall be granted in such form and manner and subject to such 

conditions as may be prescribed. 

(3) The certificate of registration issued to a person under sub-section (1) shall be deemed to have not 
been issued if the said registration is cancelled in pursuance of an application filed by such person that he 
was not liable to registration under section 22 or section 24 of the Central Goods and Services Tax Act. 

18. Transitional  arrangements  for  input  tax  credit.—(1) A registered person, other than a person 
opting to pay tax under section 10 of the Central Goods and Services Tax Act, shall be entitled to take, in 
his  electronic  credit  ledger,  credit  of  the  amount  of  Value  Added  Tax  and  Entry  Tax,  if  any,  carried 
forward in the return relating to the period ending with the day immediately preceding the appointed day, 
furnished by him under the existing law, not later than ninety days after the said day, in such manner as 
may be prescribed: 

Provided that the registered person shall not be allowed to take credit in the following circumstances, 

namely:— 

(i) where the said amount of credit is not admissible as input tax credit under this Act; or 

(ii) where he has not furnished all the returns required under the existing law for the period of six 

months immediately preceding the appointed day; or 

(iii) where the said amount of credit relates to goods sold under such exemption notifications as 

are notified by the Government: 

Provided further that so much of the said credit as is attributable to any claim related to section 3, 
sub-section (3) of section 5, section 6 or section 6A or sub-section (8) of section 8 of the Central Sales Tax 
Act, 1956 (74 of 1956) that is not substantiated in the manner, and within the period, prescribed in rule 12 of 
the  Central  Sales Tax  (Registration  and Turnover)  Rules,  1957  shall  not  be  eligible  to  be  credited  to the 
electronic credit ledger: 

Provided also that an  amount equivalent to  the  credit specified  in  the  second proviso shall  be refunded 
under the existing law when the said claims are substantiated in the manner prescribed in rule 12 of the Central 
Sales Tax (Registration and Turnover) Rules, 1957. 

(2) A registered person, other than a person opting to pay tax under section 10 of the Central Goods 
and Services Tax Act, shall be entitled to take, in his electronic credit ledger, credit of the unavailed input 
tax credit in respect of capital goods, not carried forward in a return, furnished under the existing law by 
him, for the period ending with the day immediately preceding the appointed day in such manner as may 
be prescribed: 

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Provided  that  the  registered  person  shall  not  be  allowed  to  take  credit  unless  the  said  credit  was 
admissible as input tax credit under the existing law and is also admissible as input tax credit under this 
Act. 

Explanation.—For the purposes of this section, the expression “unavailed input tax credit” means the 
amount that remains after subtracting the amount of input tax credit already availed in respect of capital 
goods by the taxable person under the existing law from the aggregate amount of input tax credit to which 
the said person was entitled in respect of the said capital goods under the existing law. 

(3)  A  registered  person,  who  was  not  liable  to  be  registered  under  the  existing  law  or  who  was 
engaged in the sale of exempted goods or tax free goods or goods which have suffered tax at first point of 
their  sale  in  the  Union  territory  and  the  subsequent  sales  of  which  are  not  subject  to  tax  in  the  Union 
territory under the existing law but which are liable to tax under this Act or where the person was entitled 
to  the  credit  of  input  tax  at  the  time  of  sale  of  goods,  shall  be  entitled  to  take,  in  his  electronic  credit 
ledger, credit of the value added tax and entry tax, if any, in respect of inputs held in stock and inputs 
contained in semi-finished or finished goods held in stock on the appointed day subject to the following 
conditions, namely:— 

(i) such inputs or goods are used or intended to be used for making taxable supplies under this 

Act; 

(ii) the said registered person is eligible for input tax credit on such inputs under this Act; 

(iii)  the said registered person is in possession of invoice or other prescribed documents 

evidencing payment of tax under the existing law in respect of such inputs; and 

(iv)  such invoices or other prescribed documents were issued not earlier than twelve months 

immediately preceding the appointed day: 

Provided  that  where  a  registered  person,  other  than  a  manufacturer  or  a  supplier  of  services,  is  not  in 
possession of an invoice or any other documents evidencing payment of tax in respect of inputs, then, such 
registered  person  shall,  subject  to  such  conditions,  limitations  and  safeguards  as  may  be  prescribed, 
including that the said taxable person shall pass on the benefit of such credit by way of reduced prices to 
the recipient, be allowed to take credit at such rate and in such manner as may be prescribed. 

(4) A registered person, who was engaged in the sale of taxable goods as well as exempted goods or 
tax free goods under the existing law but which are liable to tax under this Act, shall be entitled to take, in 
his electronic credit ledger,— 

(a)  the amount of credit of the value added tax and entry tax, if any, carried forward in a return 

furnished under the existing law by him in accordance with the provisions of sub-section (1); and 

(b) the amount of credit of the value added tax and entry tax, if any, in respect of inputs held in 
stock  and  inputs  contained  in  semi-finished  or  finished  goods  held  in  stock  on  the  appointed  day, 
relating  to  such  exempted  goods  or  tax  free  goods  in    accordance    with    the    provisions    of    sub-
section (3). 

(5) A registered person shall be entitled to take, in his electronic credit ledger, credit of value added 
tax and entry tax, if any, in respect of inputs received on or after the appointed day but the tax in respect 
of which has been paid by the supplier under the existing law, subject to the condition that the invoice or 
any other tax paying document of the same was recorded in the books of account of such person within a 
period of thirty days from the appointed day: 

Provided  that  the  period  of  thirty  days  may,  on  sufficient  cause  being  shown,  be  extended  by  the 

Commissioner for a further period not exceeding thirty days: 

Provided further that the said registered person shall furnish a statement, in such manner as may be 

prescribed, in respect of credit that has been taken under this sub-section. 

(6) A registered person, who was either paying tax at a fixed rate or paying a fixed amount in lieu of 
the tax payable under the existing law shall be entitled to take, in his electronic credit ledger, credit of 

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value added tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods 
held in stock on the appointed day subject to the following conditions, namely:— 

(i) such inputs or goods are used or intended to be used for making taxable supplies under this 

Act; 

(ii)  the said registered person is not paying tax under section 10 of the Central Goods and 

Services Tax Act; 

(iii) the said registered person is eligible for input tax credit on such inputs under this Act; 

(iv) the said registered person is in possession of invoice or other prescribed documents evidencing 

payment of tax under the existing law in respect of inputs; and 

(v)  such invoices or other prescribed documents were issued not earlier than twelve months 

immediately preceding the appointed day. 

(7) The amount of credit under sub-sections (3), (4) and (6) shall be calculated in such manner as may 

be prescribed. 

19.  Transitional  provisions  relating  to  job  work.—(1)  Where  any  inputs  received  at  a  place  of 
business  had  been  dispatched  as  such  or  dispatched  after  being  partially  processed  to  a  job  worker  for 
further processing, testing, repair, reconditioning or any other purpose in accordance with the provisions of 
existing  law  prior  to  the  appointed  day  and  such  inputs  are  returned  to  the  said  place  on  or  after  the 
appointed  day,  no  tax  shall  be  payable  if  such  inputs,  after  completion  of the  job  work  or  otherwise,  are 
returned to the said place within six months from the appointed day: 

Provided  that  the  period  of  six  months  may,  on  sufficient  cause  being  shown,  be  extended  by  the 

Commissioner for a further period not exceeding two months: 

Provided further that if such inputs are not returned within a period of six months or the extended 
period from the appointed day, the input tax credit shall be liable to be recovered in accordance with the 
provisions of clause (a) of sub-section (8) of section 142 of the Central Goods and Services Tax Act. 

(2) Where any semi-finished goods had been despatched from any place of business to any other premises 
for carrying out certain manufacturing processes in accordance with the provisions of existing law prior to the 
appointed day and such goods (hereinafter in this section referred to as “the said goods”) are returned to the 
said  place  on  or  after  the  appointed  day,  no  tax  shall  be  payable  if  the  said  goods,  after  undergoing 
manufacturing processes or otherwise, are returned to the said place within six months from the appointed day: 

Provided  that  the  period  of  six  months  may,  on  sufficient  cause  being  shown,  be  extended  by  the 

Commissioner for a further period not exceeding two months: 

Provided further that if the said goods are not returned within a period specified in this sub-section, 
the input tax credit shall be liable to be recovered in accordance with the provisions of clause (a) of sub-
section (8) of section 142 of the Central Goods and Services Tax Act: 

Provided  also  that  the  person  despatching  the  goods  may,  in  accordance  with  the  provisions  of  the 
existing law, transfer the said goods to the premises of any registered person for the purpose of supplying 
therefrom  on  payment  of  tax  in  India  or  without  payment  of  tax  for  exports  within  six  months  or  the 
extended period, as the case may be, from the appointed day. 

(3)  Where  any  goods  had  been  despatched  from  the  place  of  business  without  payment  of  tax  for 
carrying  out  tests  or  any  other  process  to  any  other  premises,  whether  registered  or  not,  in  accordance 
with  the  provisions  of  existing  law  prior  to  the  appointed  day  and  such  goods  are  returned  to  the  said 
place of business on or after the appointed day, no tax shall be payable if the said goods, after undergoing 
tests or any other process, are returned to such place within six months from the appointed day: 

Provided  that  the  period  of  six  months  may,  on  sufficient  cause  being  shown,  be  extended  by  the 

Commissioner for a further period not exceeding two months: 

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Provided further that if the said goods are not returned within the period specified in this sub-section, 
the input tax credit shall be liable to be recovered in accordance with the provisions of clause (a) of sub-
section (8) of section 142 of the Central Goods and Services Tax Act: 

Provided  also  that  the  person  despatching  the  goods  may,  in  accordance  with  the  provisions  of  the 
existing law, transfer the said goods from the said other premises on payment of tax in India or without 
payment  of  tax  for  exports  within  six  months  or  the  extended  period,  as  the  case  may  be,  from  the 
appointed day. 

(4) The tax under sub-sections (1), (2) and (3) shall not be payable only if the person despatching the 
goods and the job worker declare the details of the inputs or goods  held in stock by the job worker on 
behalf of the said person on the appointed day in such form and manner and within such time as may be 
prescribed. 

20.  Miscellaneous  transitional  provisions.—(1)  Where  any  goods  on  which  tax,  if  any,  had  been 
paid  under  the  existing  law  at  the  time  of  sale  thereof,  not  being  earlier  than  six  months  prior  to  the 
appointed day, are returned to any place of business on or after the appointed day, the registered person shall 
be  eligible  for  refund  of   the   tax   paid   under   the  existing  law  where   such   goods   are   returned 
by a person, other than a registered person, to the said place of business within a period of six months 
from the appointed day and such goods are identifiable to the satisfaction of the proper officer: 

Provided that if the said goods are returned by a registered person, the return of such goods shall be 

deemed to be a supply. 

(2) (a) Where, in pursuance of a contract entered into prior to the appointed day, the price of any goods 
is revised upwards on or after the appointed day, the registered person who had sold such goods shall issue 
to the recipient a supplementary invoice or debit note, containing such particulars as may be prescribed, 
within thirty days of such price revision and for the purposes of this Act, such supplementary invoice or 
debit note shall be deemed to have been issued in respect of an outward supply made under this Act. 

(b) Where, in pursuance of a contract entered into prior to the appointed day, the price of any goods is 
revised  downwards  on  or  after  the  appointed  day,  the  registered  person  who  had  sold  such  goods  may 
issue to the recipient a credit note, containing such particulars as may be prescribed, within thirty days of 
such price revision and for the purposes of this Act such credit note shall be deemed to have been issued 
in respect of an outward supply made under this Act: 

Provided that the registered person shall be allowed to reduce his tax liability on account of issue of 
the  credit  note only  if  the recipient  of  the  credit  note  has  reduced  his  input tax credit corresponding  to 
such reduction of tax liability. 

(3) Every claim for refund filed by any person before, on or after the appointed day, for refund of any 
amount of input tax credit, tax, interest or any other amount paid under the existing law, shall be disposed 
of in accordance with the provisions of existing law and any amount eventually accruing to him shall be 
refunded to him in cash in accordance with the provisions of the said law: 

Provided  that  where  any  claim  for  refund  of  the  amount  of  input  tax  credit  is  fully  or  partially 

rejected, the amount so rejected shall lapse: 

Provided further that no refund shall be allowed of any amount of input tax credit where the balance 

of the said amount as on the appointed day has been carried forward under this Act. 

(4) Every claim for refund filed after the appointed day for refund of any tax paid under the existing 
law in respect of the goods exported before or after the appointed day shall be disposed of in accordance 
with the provisions of the existing law: 

Provided  that  where  any  for  refund  of  input  tax  credit  is  fully  or  partially  rejected,  the  amount  so 

rejected shall lapse: 

Provided further that no refund shall be allowed of any amount of input tax credit where the balance 

of the said amount as on the appointed day has been carried forward under this Act. 

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(5)  (a)  Every  proceeding  of  appeal,  revision,  review  or  reference  relating  to  a  claim  for  input  tax 
credit initiated whether before, on or after the appointed day, under the existing law shall be disposed of 
in accordance with the provisions of the existing law, and any amount of credit found to be admissible to 
the claimant shall be refunded to him in cash in accordance with the provisions of the existing law and the 
amount rejected, if any, shall not be admissible as input tax credit under this Act: 

Provided that no refund shall be allowed of any amount of input tax credit where the balance of the said 

amount as on the appointed day has been carried forward under this Act. 

(b) Every proceeding of appeal, revision, review or reference relating to recovery of input tax credit 
initiated  whether  before,  on  or  after  the  appointed  day,  under  the  existing  law  shall  be  disposed  of  in 
accordance with the provisions of the existing law, and if any amount of credit becomes recoverable as a 
result  of  such  appeal,  revision, review  or  reference,  the  same  shall,  unless recovered  under  the existing 
law, be recovered as an arrear of tax under this Act and the amount so recovered shall not be admissible 
as input tax credit under this Act. 

(6)  (a)  Every  proceeding  of  appeal,  revision,  review  or  reference  relating  to  any  output  tax  liability 
initiated  whether  before,  on  or  after  the  appointed  day  under  the  existing  law,  shall  be  disposed  of  in 
accordance with the provisions of the existing law, and if any amount becomes recoverable as a result of such 
appeal, revision, review or reference, the same shall, unless recovered under the existing law, be recovered as 
an arrear of tax under this Act and amount so recovered shall not be admissible as input tax credit under this 
Act. 

(b) Every proceeding of appeal, revision, review or reference relating to any output tax liability initiated 
whether before, on or after the appointed day under the existing law, shall be disposed of in accordance with 
the provisions of the existing law, and any amount found to be admissible to the claimant shall be refunded to 
him in cash in accordance with the provisions of the existing law and the amount rejected, if any, shall not be 
admissible as input tax credit under this Act. 

(7) (a) Where in pursuance of an assessment or adjudication proceedings instituted, whether before, on 
or after the appointed day, under the existing law, any amount of tax, interest, fine or penalty becomes 
recoverable from the person, the same shall, unless recovered under the existing law, be recovered as an 
arrear of tax under this Act and the amount so recovered shall not be admissible as input tax credit under 
this Act. 

(b) Where in pursuance of an assessment or adjudication proceedings instituted, whether before, on or 
after  the  appointed  day  under  the  existing  law,  any  amount  of  tax,  interest,  fine  or  penalty  becomes 
refundable  to  the taxable  person, the  same  shall  be refunded  to  him  in cash  under the  said  law  and the 
amount rejected, if any, shall not be admissible as input tax credit under this Act. 

(8)  (a)  Where  any  return,  furnished  under  the  existing  law,  is  revised  after  the  appointed  day  and  if, 
pursuant to such revision, any amount is found to be recoverable or any amount of input tax credit is found to 
be inadmissible, the same shall, unless recovered under the existing law, be recovered as an arrear of tax under 
this Act and the amount so recovered shall not be admissible as input tax credit under this Act. 

(b) Where any return, furnished under the existing law, is revised after the appointed day but within 
the  time  limit  specified  for  such  revision  under  the  existing  law  and  if,  pursuant  to  such  revision,  any 
amount is found to be refundable or input tax credit is found to be admissible to any taxable person, the 
same shall be refunded to him in cash under the existing law and the amount rejected, if any, shall not be 
admissible as input tax credit under this Act. 

(9) Save as otherwise provided in this Chapter, the goods or services or both supplied on or after the 
appointed  day  in  pursuance  of  a  contract  entered  into  prior  to  the  appointed  day  shall  be  liable  to  tax 
under the provisions of this Act. 

(10)  (a)  Notwithstanding  anything  contained  in  section  12  of  the  Central  Goods  and  Services  Tax 
Act, no tax shall be payable on goods under this Act to the extent the tax was leviable on the said goods 
under the existing law. 

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(b) Notwithstanding anything contained in section 13 of the Central Goods and Services Tax Act, no 
tax shall be payable on services under this Act to the extent the tax was leviable on the said services under 
Chapter V of the Finance Act, 1994 (32 of 1994). 

(c) Where tax was paid on any supply, both under any existing law relating to sale of goods and under 
Chapter  V  of  the  Finance  Act,  1994  (32  of  1994),  tax  shall  be  leviable  under  this  Act  and  the  taxable 
person shall be entitled to take credit of value added tax or service tax paid under the existing law to the 
extent of supplies made after the appointed day and such credit shall be calculated in such manner as may 
be prescribed. 

(11)  Where any goods sent on approval basis, not earlier than six months before the appointed day, 
are rejected or not approved by the buyer and returned to the seller on or after the appointed day, no tax 
shall be payable thereon if such goods are returned within six months from the appointed day: 

Provided that the said period of six months may, on sufficient cause being shown, be extended by the 

Commissioner for a further period not exceeding two months: 

Provided further that the tax shall be payable by the person returning the goods if such goods are 

liable to tax under this Act and are returned after the period specified in this sub-section: 

Provided also that tax shall be payable by the person who has sent the goods on approval basis if such 
goods are liable to tax under this Act, and are not returned within the period specified in this sub-section. 

(12) Where a supplier has made any sale of goods in respect of which tax was required to be deducted at 
source under any existing law relating to sale of goods and has also issued an invoice for the same before the 
appointed day, no deduction of tax at source under section 51 of the Central Goods and Services Tax Act, as 
made applicable to this Act, shall be made by the deductor under the said section where payment to the said 
supplier is made on or after the appointed day. 

Explanation.—For the purposes of this Chapter, the expression “capital goods” shall have the same 

meaning as assigned to it in any existing law relating to sale of goods. 

CHAPTER IX 
MISCELLANEOUS 

21. Application of provisions of Central Goods and Services Tax Act.—Subject to the provisions 
of  this  Act  and  the  rules  made  thereunder,  the  provisions  of  the  Central  Goods  and  Services  Tax  Act, 
relating to,— 

(i) scope of supply; 

(ii) composition levy; 

(iii) composite supply and mixed supply; 

(iv) time and value of supply; 

(v) input tax credit; 

(vi) registration; 

(vii) tax invoice, credit and debit notes; 

(viii) accounts and records; 

(ix) returns; 

(x) payment of tax; 

(xi) tax deduction at source; 

(xii) collection of tax at source; 

(xiii) assessment; 

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(xiv) refunds; 

(xv) audit; 

(xvi) inspection, search, seizure and arrest; 

(xvii) demands and recovery; 

(xviii) liability to pay in certain cases; 

(xix) advance ruling; 

(xx) appeals and revision; 

(xxi) presumption as to documents; 

(xxii) offences and penalties; 

(xxiii) job work; 

(xxiv) electronic commerce; 

(xxv) settlement of funds; 

(xxvi) transitional provisions; and 

(xxvii) miscellaneous provisions including the provisions relating to the imposition of interest and 

penalty, 

shall, mutatis mutandis, apply,— 

(a) so far as may be, in relation to Union territory tax as they apply in relation to central tax as if 

they were enacted under this Act; 

(b)  subject to the following modifications and alterations which the Central Government 

considers necessary and desirable to adapt those provisions to the circumstances, namely:— 

(i) references to “this Act” shall be deemed to be references to “the Union Territory Goods 

and Services Tax Act, 2017”; 

(ii)  references to “Commissioner” shall be deemed to be references to “Commissioner” of 

Union territory tax as defined in clause (2) of section 2 of this Act; 

(iii)  references to “officers of central tax” shall be deemed to be references to “officers of 

Union territory tax”; 

(iv) references to “central tax” shall be deemed to be references to “Union territory tax” and 

vice versa; 

(v) references to “Commissioner of State tax or Commissioner of Union territory tax” shall be 

deemed to be references to “Commissioner of central tax”; 

(vi) references to “State Goods and Services Tax Act or Union Territory Goods and Services 

Tax Act” shall be deemed to be references to “Central Goods and Services Tax Act”; 

(vii)  references to “State tax or Union territory tax” shall be deemed to be references to 

“central tax”. 

22.  Power  to  make  rules.—(1)  The  Central  Government  may,  on  the  recommendations  of  the 

Council, by notification, make rules for carrying out the provisions of this Act. 

(2) Without prejudice to the generality of the provisions of sub-section (1), the Central Government 
may make rules for all or any of the matters which by this Act are required to be, or may be, prescribed or 
in respect of which provisions are to be or may be made by rules. 

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(3) The power to make rules conferred by this section shall include the power to give retrospective 
effect to the rules or any of them from a date not earlier than the date on which the provisions of this Act 
come into force. 

(4) Any rules made under sub-section (1) may provide that a contravention thereof shall be liable to a 

penalty not exceeding ten thousand rupees. 

23.  General  power  to  make  regulations.—The  Board  may,  by  notification,  make  regulations 

consistent with this Act and the rules made thereunder to carry out the purposes of this Act. 

24.  Laying  of  rules,  regulations  and  notifications.—Every  rule  made  by  the  Central  Government, 
every regulation made by the Board and every notification issued by the Central Government under this Act, 
shall be laid, as soon as may be, after it is made or issued, before each House of Parliament, while it is in 
session,  for  a  total  period  of  thirty  days  which  may  be  comprised  in  one  session  or  in  two  or  more 
successive  sessions,  and  if,  before  the  expiry  of  the  session  immediately  following  the  session  or  the 
successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or in 
the  notification,  as  the  case  may  be,  or  both  Houses  agree  that  the  rule  or  regulation  or  the  notification 
should not be made, the rule or  regulation or notification, as the case  may be, shall thereafter have effect 
only in such modified form or be of no effect, as the case may be; so, however, that any such modification 
or  annulment  shall  be  without  prejudice  to  the  validity  of  anything  previously  done  under  that  rule  or 
regulation or notification, as the case may be. 

25. Power to issue instructions or directions.—The Commissioner may, if he considers it necessary or 
expedient  so  to  do  for  the  purpose  of  uniformity  in  the  implementation  of  this  Act,  issue  such  orders, 
instructions  or  directions  to  the  Union  territory  tax  officers  as  he  may  deem  fit,  and  thereupon  all  such  
officers  and  all  other  persons  employed  in  the  implementation  of  this  Act  shall  observe  and  follow  such 
orders, instructions or directions. 

26. Removal of difficulties.—(1) If any difficulty arises in giving effect to any provision of this Act, the 
Central Government may, on the recommendations of the Council, by a general or a special order published  
in the Official Gazette, make such provisions not inconsistent with the provisions of this Act or the rules or 
regulations  made  thereunder,  as  may  be  necessary  or  expedient  for  the  purpose  of  removing  the  said  
difficulty: 

Provided that no such order shall be made after the expiry of a period of 1[five years] from the date of 

commencement of this Act. 

(2) Every order made under this section shall be laid, as soon as may be, after it is made, before each 

House of Parliament. 

1. Subs. by Act 12 of 2020, s. 138, for “three years” (w.e.f. 27-3-2020). 

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