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CESS ON CIGARETTES, Goods and Services Tax - GST

Issue Id: - 116086
Dated: 2-3-2020
By:- deepak gulati

  • Contents

A dealer who deals in sale of cigarettes has duly taken Input Tax Credit of



3) Compensation Cess (based on ad-valorem)

And he was under impression that he need not show output liability on Additional Cess (based on quantity of cigarettes) as it is same in both cases of sale and purchase. Further he has not shown input / output w.r.t such additional cess in GSTR-3B.

Now in this case assuming FY 2018-19:-

1) Should he report this additional cess output liability now in February 2020?

2) Will he be eligible to claim ITC of such additional cess now?

It is mentioned here that both input / output cess amount is same.

For example:- additional cess on cigrattes is ₹ 4,170 per 1,000 pcs on both purchase and sales transactions.

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Showing Replies 1 to 4 of 4 Records

1 Dated: 2-3-2020
By:- Atul Rathod

He cant claim the credit but output tax needs to be paid. He should not report instead the same should be paid through DRC-03.

2 Dated: 2-3-2020

Hit by Section 16(4) of CGST Act. I agree with Sh.Atul Rathod Ji.

3 Dated: 4-3-2020
By:- deepak gulati


With due respect, we would like to draw your attention towards below mentioned illustration:-

Lets suppose against an invoice dealer has availed input tax credit of CGST but inadvertently missed availing credit of SGST. In such case sec. 16(4) restriction still applies.

P.S.- Sec. 16(4) talks about ITC in respect of any invoice.......... but in above case dealer has taken input of one component and missed input of other component within the same invoice.

4 Dated: 4-3-2020

In this scenario too, ITC will be hit by the time bar limit under Section 16 (4) of CGST.


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