Section 142 of the Central Goods and Services Tax Act, 2017 deals with miscellaneous transitional provisions that govern transactions, refunds, appeals, recoveries, price revisions and other matters connected with the transition from the pre-GST tax regime to GST.
GST came into effect on 1 July 2017, replacing or subsuming several indirect taxes and tax laws. Because businesses had transactions, contracts, tax payments, refunds, credit balances, disputes and goods movements that existed before GST but continued after its introduction, the CGST Act needed provisions to determine how such matters would be treated. Section 142 provides several of these transitional rules.
Section 142 is particularly important because it does not deal with just one type of transaction. Instead, it contains thirteen major sub-sections, covering matters such as return of goods, upward and downward price revisions, old-law refund claims, CENVAT credit proceedings, output tax disputes, assessment and adjudication proceedings, revised returns, contracts entered into before GST, goods supplied on approval basis and pre-GST VAT TDS situations.
The basic objective is to ensure that the introduction of GST did not leave pre-GST transactions and proceedings without a legal mechanism for their completion.
What Is Section 142 of the CGST Act?
Section 142 is titled “Miscellaneous transitional provisions.”
It forms part of Chapter XX – Transitional Provisions of the CGST Act.
The section provides rules for situations in which the transaction, tax liability, refund claim, credit issue or legal proceeding is connected with the period before the GST regime began but has consequences on or after the appointed day.
The expression “appointed day” is defined in Section 2(10) as the date on which the provisions of the CGST Act come into force. GST implementation began from 1 July 2017.
Section 142 should therefore be understood as a bridge between the existing tax laws and the GST regime.
Why Was Section 142 Required?
GST replaced several indirect tax systems, including central excise, service tax and State VAT-related taxation.
However, the change to GST did not mean that every pre-GST transaction automatically disappeared.
For example, before 1 July 2017:
- goods could already have been sold;
- services could already have been provided;
- taxes could already have been paid;
- CENVAT credit could already have existed;
- refund claims could already have been filed;
- appeals could already have been pending;
- assessments could already have been initiated;
- contracts could already have been signed; and
- goods could have been sent on approval basis.
Some of these matters continued after GST came into force.
Section 142 establishes how these situations are to be handled. The GST Council’s transition guidance explains that Chapter XX, including Section 142, was designed to deal with pending and future claims connected with the existing law, including refund and recovery matters.
Structure of Section 142
Section 142 contains provisions dealing with the following broad areas:
| Sub-section | Main subject |
|---|---|
| Section 142(1) | Return of goods removed before GST |
| Section 142(2) | Upward or downward price revision |
| Section 142(3) | Refund claims under existing law |
| Section 142(4) | Refund relating to exported goods or services |
| Section 142(5) | Refund of tax paid for services not provided |
| Section 142(6) | CENVAT credit appeal, review or reference |
| Section 142(7) | Output duty or tax liability proceedings |
| Section 142(8) | Assessment or adjudication proceedings |
| Section 142(9) | Revision of returns under existing law |
| Section 142(10) | Supplies made after GST under pre-GST contracts |
| Section 142(11) | Treatment of goods and services taxed under earlier laws |
| Section 142(12) | Goods sent on approval basis |
| Section 142(13) | Pre-GST VAT TDS and invoices |
Each provision addresses a different transitional situation.
Section 142(1) – Return of Goods Removed Before GST
Section 142(1) deals with goods that were removed under the existing law before the appointed day and are returned after GST comes into force.
The provision applies where:
- duty, if any, had been paid under the existing law;
- the goods had been removed not earlier than six months before the appointed day;
- the goods are returned on or after the appointed day; and
- the goods are identifiable to the satisfaction of the proper officer.
Where such goods are returned by a person other than a registered person to the place of business within six months from the appointed day, the registered person is eligible for refund of the duty paid under the existing law.
However, if the goods are returned by a registered person, the return is treated as a supply.
Example of Section 142(1)
Suppose goods were removed by a manufacturer in June 2017 after payment of applicable excise duty.
After GST came into force on 1 July 2017, the buyer returns the goods within the specified transitional period.
If the person returning the goods is unregistered and the statutory conditions are satisfied, the manufacturer may claim the applicable refund of the duty paid under the existing law.
If the goods are returned by a registered person, the transaction is treated as a supply under the transitional mechanism.
Why Identification of Goods Matters
The provision requires the goods to be identifiable to the satisfaction of the proper officer.
This is important because the refund relates to duty that was actually paid on the goods under the earlier tax regime.
Businesses therefore needed to maintain records capable of establishing:
- what goods were removed;
- when they were removed;
- the applicable duty;
- the identity of the goods; and
- when and by whom the goods were returned.
Section 142(2) – Upward and Downward Price Revision
Section 142(2) deals with situations where a contract was entered into before the appointed day, but the price of the goods or services is revised after GST comes into force.
It contains two different situations:
- upward revision of price; and
- downward revision of price.
Upward Price Revision
Where the price is revised upwards after GST in pursuance of a contract entered into before the appointed day, the registered person who removed or provided the goods or services must issue a supplementary invoice or debit note within 30 days of the price revision.
For GST purposes, the supplementary invoice or debit note is treated as relating to an outward supply made under the GST Act.
Example
Suppose a contract for supply of goods was entered into before 1 July 2017.
The original price was ₹10 lakh.
After GST came into force, the price is revised upwards by ₹1 lakh under the terms of the original contract.
The supplier may need to issue the prescribed supplementary invoice or debit note within the statutory period, and the additional amount is dealt with under the GST framework.
Downward Price Revision
Where the price is revised downwards after the appointed day pursuant to a pre-GST contract, the registered person may issue a credit note within 30 days of the price revision.
The credit note is treated as relating to an outward supply under the GST Act.
However, the supplier is allowed to reduce the tax liability on account of the credit note only if the recipient has reduced the corresponding input tax credit.
This condition is important because a reduction in the supplier’s tax liability should correspond with the recipient’s reduction in ITC.
Example of Downward Price Revision
Suppose:
- a pre-GST contract exists;
- the supply is completed under the transitional arrangement;
- the price is subsequently reduced;
- the supplier issues a credit note.
If the recipient had claimed corresponding ITC, the recipient must make the corresponding reduction before the supplier can reduce its tax liability in accordance with Section 142(2).
Section 142(3) – Refund Claims Under Existing Law
Section 142(3) deals with refund claims filed under the existing law.
A person may have filed a claim before, on or after the appointed day for refund of:
- CENVAT credit;
- duty;
- tax;
- interest; or
- any other amount paid under the existing law.
Such a refund claim is to be disposed of according to the provisions of the existing law. If an amount ultimately becomes payable to the claimant, it is paid in cash, subject to the statutory conditions.
Rejected CENVAT Credit Refund
Section 142(3) contains an important rule concerning rejected CENVAT credit refund claims.
If a claim for refund of CENVAT credit is fully or partly rejected, the rejected amount lapses.
It cannot simply be converted into GST input tax credit.
The provision also states that no refund is allowed for an amount of CENVAT credit where the balance of that amount on the appointed day had already been carried forward under the GST Act.
Example
Suppose a taxpayer had ₹5 lakh of CENVAT credit under the pre-GST regime.
The taxpayer carries the eligible amount into the GST regime as transitional credit.
The taxpayer cannot subsequently seek a separate cash refund of the same amount under the old-law refund mechanism merely because a refund claim relates to the earlier period.
Section 142 prevents duplication between transitional credit and cash refund.
Section 142(4) – Refund Relating to Exports
Section 142(4) deals with refund claims filed after the appointed day concerning duty or tax paid under the existing law in respect of goods or services exported before or after the appointed day.
Such claims are disposed of according to the provisions of the existing law.
As with Section 142(3), where a CENVAT credit refund is fully or partly rejected, the rejected amount lapses.
The provision also prevents refund of CENVAT credit where the relevant balance had already been carried forward under GST.
Importance for Exporters
Export transactions frequently involve refund or rebate mechanisms.
Because an export transaction may straddle the transition from the old tax regime to GST, Section 142(4) ensures that eligible old-law claims continue to be dealt with under the applicable existing-law provisions.
The transitional rule therefore prevents a complete legal break merely because GST commenced.
Section 142(5) – Refund of Tax Paid for Services Not Provided
Section 142(5) addresses a different refund situation.
It applies where a person files a claim after the appointed day for refund of tax paid under the existing law in respect of services that were not provided.
The claim is disposed of under the existing law, and any amount ultimately payable is refunded in cash, subject to the statutory provisions.
This provision recognises that a taxpayer could have paid service tax under the earlier regime even though the corresponding service was ultimately not provided.
The introduction of GST does not itself extinguish the old-law refund mechanism for such a claim.
Section 142(6) – CENVAT Credit Appeals, Reviews and References
Section 142(6) deals with proceedings relating to CENVAT credit.
It covers proceedings of:
- appeal;
- review; or
- reference
relating to a claim for CENVAT credit initiated before, on or after the appointed day under the existing law.
Such proceedings continue to be disposed of according to the existing law.
If Credit Is Found Admissible
Where an amount of CENVAT credit is found admissible to the claimant, the amount is refunded in cash.
The provision specifically prevents the amount from simply becoming GST input tax credit.
If CENVAT Credit Is Rejected
If an amount is rejected, it is not admissible as input tax credit under GST.
Further, where the relevant CENVAT credit balance had already been carried forward under GST, a refund of that same amount is not permitted.
Recovery of CENVAT Credit
Section 142(6)(ii) deals with proceedings relating to recovery of CENVAT credit.
If, as a result of an appeal, review or reference, some CENVAT credit becomes recoverable, it is recovered under the existing law where possible.
If it is not recovered under the existing law, it is recovered as an arrear of tax under the CGST Act.
The amount recovered is not admissible as input tax credit under GST.
Section 142(7) – Output Duty or Tax Liability Proceedings
Section 142(7) deals with proceedings relating to output duty or tax liability under the existing law.
These proceedings may be:
- appeals;
- reviews; or
- references.
They may have been initiated before, on or after the appointed day.
The proceedings continue to be disposed of according to the existing law.
If Additional Tax Becomes Recoverable
If an amount becomes recoverable as a result of an appeal, review or reference, the amount is recovered under the existing law where possible.
If it is not recovered under the existing law, it is recovered as an arrear of duty or tax under the CGST Act.
The amount recovered is not available as input tax credit under GST.
If Tax Becomes Refundable
Section 142(7)(b) deals with a situation where an amount is found to be admissible to the claimant.
The amount is refunded in cash under the existing law, subject to the statutory conditions.
As with the other transitional refund provisions, an amount already carried forward as CENVAT credit under GST cannot be refunded again.
Section 142(8) – Assessment and Adjudication Proceedings
Section 142(8) is important for old-law assessment and adjudication proceedings.
It covers proceedings instituted under the existing law before, on or after the appointed day.
If such proceedings result in tax, interest, fine or penalty becoming recoverable, the amount is dealt with under the transitional mechanism.
Recovery of Old Tax Demand
Where an amount becomes recoverable from a person pursuant to assessment or adjudication under the existing law, it is first recoverable under the existing law.
If it is not recovered under the existing law, it is recovered as an arrear of tax under the CGST Act.
The amount so recovered is not admissible as input tax credit under GST.
Example
Suppose an excise assessment relating to the pre-GST period was pending.
After the GST regime begins, the old assessment is completed and results in an additional excise duty liability.
If the amount is not recovered under the existing law, Section 142(8)(a) allows it to be recovered as an arrear of tax under the CGST Act.
Refund Resulting From Assessment
Section 142(8)(b) addresses the opposite situation.
If an assessment or adjudication proceeding under the existing law results in an amount becoming refundable to the taxable person, that amount is refunded in cash under the existing law, subject to the statutory provisions.
The amount rejected, if any, is not available as GST input tax credit.
Section 142(9) – Revision of Returns Under Existing Law
Section 142(9) deals with returns furnished under the existing law that are revised after the appointed day.
If the revision results in:
- an amount becoming recoverable; or
- CENVAT credit becoming inadmissible,
the amount is recovered as an arrear of tax under GST if it is not recovered under the existing law.
The amount recovered is not admissible as input tax credit.
Refund After Revision
Section 142(9)(b) deals with the opposite situation.
If a return under the existing law is revised after the appointed day but within the time allowed under the existing law and the revision results in:
- an amount becoming refundable; or
- CENVAT credit becoming admissible,
the amount is refunded in cash under the existing law.
Again, the rejected amount is not converted into GST ITC.
Section 142(10) – Supplies Under Pre-GST Contracts
Section 142(10) provides an important general transitional rule.
Except where otherwise provided in Chapter XX, goods or services supplied on or after the appointed day pursuant to a contract entered into before the appointed day are liable to tax under the GST Act.
This provision is important because the date on which the contract was signed does not, by itself, determine whether GST applies.
The actual supply occurring after GST commenced can fall under GST, subject to the specific transitional provisions.
Example
Suppose a company entered into a contract in May 2017.
The contract requires delivery of goods in August 2017.
GST had already commenced by the time of delivery.
Unless a specific transitional provision provides otherwise, the supply made after the appointed day is subject to GST under Section 142(10).
Therefore, a pre-GST contract does not automatically mean that the entire transaction remains subject to the old tax regime.
Section 142(11) – Tax Treatment of Transitional Supplies
Section 142(11) is one of the most important provisions in the section because it deals with situations where the same transaction may have connections with both the old tax regime and GST.
It contains three important clauses.
Section 142(11)(a) – Goods
Section 142(11)(a) provides that, notwithstanding Section 12, no GST is payable on goods to the extent that tax was leviable on those goods under the relevant State VAT law.
This provision prevents overlapping taxation in the transition period.
Section 142(11)(b) – Services
Similarly, Section 142(11)(b) provides that, notwithstanding Section 13, no GST is payable on services to the extent that service tax was leviable on those services under Chapter V of the Finance Act, 1994.
The purpose is to avoid taxing the same portion of a service under both the old service tax regime and GST.
Section 142(11)(c) – Tax Paid Under Both VAT and Service Tax
Section 142(11)(c) deals with supplies where tax was paid under both:
- the relevant VAT law; and
- Chapter V of the Finance Act, 1994.
In such cases, tax is leviable under GST, and the taxable person is entitled to take credit of the VAT or service tax paid under the existing law to the extent of supplies made after the appointed day, with the credit calculated in the prescribed manner.
This provision is particularly relevant to transactions that straddle the pre-GST and post-GST periods.
Example of Section 142(11)(c)
Suppose a composite transaction involves elements that were previously subjected to both VAT and service tax.
Part of the transaction relates to the period before GST, while the remaining supply takes place after GST.
Section 142(11)(c) provides a mechanism for dealing with the old-law taxes and the GST liability so that the transition does not result in unintended double taxation.
GST Council-published advance ruling material also shows the practical importance of Section 142(11)(c) in disputes involving transitional supplies and mobilisation advances.
Section 142(12) – Goods Sent on Approval Basis
Section 142(12) deals with goods that were sent on approval basis before GST.
The provision applies where:
- goods were sent on approval basis not earlier than six months before the appointed day;
- the buyer rejects or does not approve the goods; and
- the goods are returned to the seller on or after the appointed day.
No tax is payable on the returned goods if they are returned within six months from the appointed day, subject to the statutory conditions.
The Commissioner may extend the six-month period by a further period not exceeding two months if sufficient cause is shown.
👉 Read More → Section 144 – Presumption as to documents in certain cases
What If Goods Are Returned Late?
Section 142(12) provides consequences where the goods are not returned within the specified period.
Where the goods are liable to GST and are returned after the prescribed period, tax may become payable by the person returning the goods.
The provision also covers the situation where the goods are not returned within the prescribed period, in which case tax may become payable by the person who sent the goods on approval basis.
Example
A manufacturer sends goods to a prospective buyer on approval basis in May 2017.
The buyer does not approve the goods and returns them after GST has commenced.
If the goods are returned within the statutory transitional period, the special protection under Section 142(12) may apply.
If the goods are not returned within the permitted period, the provision creates a GST liability according to the circumstances specified in the section.
Section 142(13) – Pre-GST VAT TDS
Section 142(13) addresses a specific situation involving tax deduction at source under State or Union territory VAT law.
It applies where:
- a supplier made a sale of goods;
- tax was required to be deducted at source under a State or Union territory VAT law;
- the supplier had issued an invoice before the appointed day; and
- payment to the supplier is made on or after the appointed day.
In such circumstances, the deductor is not required to deduct tax under Section 51 of the CGST Act on that payment.
This provision prevents duplication between the old VAT TDS mechanism and GST TDS.
Explanation to Section 142 – Important Definitions
Section 142 contains an Explanation stating that certain expressions used in Chapter XX have the same meaning as assigned under the Central Excise Act, 1944 or the rules made thereunder.
The Explanation specifically refers to expressions such as:
- capital goods;
- CENVAT credit;
- first stage dealer;
- second stage dealer; and
- manufacture.
This was important because many of the transitional provisions depend on concepts that originated in the pre-GST central excise framework.
Section 142 and the Meaning of “Existing Law”
The transitional provisions rely heavily on the concept of existing law.
Section 2(48) defines “existing law” to include any law, notification, order, rule or regulation relating to the levy and collection of duty or tax on goods or services or both that was passed or made before the commencement of the CGST Act by the competent legislative or other authority.
This definition is important because Section 142 repeatedly requires taxpayers and authorities to apply the provisions of the existing law to transitional matters.
Section 142 and Section 140 – Difference
Section 140 primarily deals with transitional input tax credit.
It provides mechanisms for eligible CENVAT credit and other specified pre-GST credits to move into the GST electronic credit ledger, subject to statutory conditions.
Section 142 is broader.
It deals with:
- old-law refunds;
- old-law appeals;
- old-law assessments;
- recoveries;
- price revisions;
- goods returns;
- pre-GST contracts;
- approval-basis goods; and
- other transitional situations.
Therefore:
Section 140 = Transitional ITC
Section 142 = Miscellaneous transitional transactions and proceedings
The GST Council’s transition guidance separately identifies Section 140 as the principal provision for carried-forward credit and Sections 139–142 as the statutory transitional framework.
Section 142 and Section 141 – Difference
Section 141 deals specifically with transitional provisions relating to job work.
For example, goods sent to job workers under the existing law before GST could be returned after GST subject to specified transitional conditions.
Section 142, in contrast, contains the broader miscellaneous transitional provisions.
The two provisions can therefore be distinguished as:
| Section | Main purpose |
|---|---|
| Section 140 | Transitional ITC |
| Section 141 | Transitional job-work provisions |
| Section 142 | Miscellaneous transitional provisions |
Section 141 itself cross-references Section 142(8)(a) for recovery where specified goods are not returned within the permitted period.
Section 142 and Section 73 or 74
Section 142 primarily concerns liabilities and proceedings connected with the existing law.
Where an old-law assessment or adjudication results in a recoverable amount, Section 142(8) provides the transitional recovery mechanism.
This is different from a fresh GST demand under the CGST Act.
For example:
- an old excise demand may continue under the old law;
- if it becomes recoverable and remains unpaid, Section 142 can permit recovery as an arrear under GST.
The GST Council’s official circular on transitional recovery specifically explains that old central excise and service tax liabilities arising from existing-law proceedings are recovered as arrears of tax under the CGST Act where they remain unrecovered under the existing law.
Section 142 and Section 79
Section 79 provides general mechanisms for recovery of amounts payable under the CGST Act.
Section 142(6), 142(7), 142(8) and 142(9) can result in old-law amounts being recovered as arrears under the CGST Act.
Once such an amount becomes recoverable as an arrear under GST, the relevant GST recovery mechanism can become important.
Therefore, Section 142 provides the transitional legal bridge, while Section 79 provides general GST recovery mechanisms for amounts recoverable under the CGST framework.
Practical Example – Old Excise Demand After GST
Consider a manufacturer whose excise assessment for the pre-GST period remains pending on 1 July 2017.
The assessment is later completed under the existing law and an additional excise duty liability is determined.
If the amount is not recovered under the existing law, Section 142(8)(a) provides for recovery as an arrear of tax under the CGST Act.
This does not mean that the original pre-GST liability becomes a normal GST liability in substance. Rather, Section 142 provides the statutory mechanism for recovering the old-law amount through the GST recovery framework.
Practical Example – Old CENVAT Credit Dispute
Suppose a taxpayer had a CENVAT credit claim under the pre-GST regime.
A dispute concerning that credit continues after GST begins.
Under Section 142(6), the appeal, review or reference continues to be disposed of under the existing law.
If credit is found admissible, it is refunded in cash.
If credit is found recoverable, the statutory transitional recovery mechanism applies.
This prevents the old dispute from becoming legally unresolved merely because GST replaced the earlier credit system.
Practical Example – Pre-GST Contract With Post-GST Supply
Suppose a company signs a contract in June 2017.
The actual supply is made in August 2017.
The contract is therefore pre-GST, but the supply takes place after GST commenced.
Section 142(10) provides that, unless another transitional provision applies, the supply made on or after the appointed day is liable to tax under GST.
The date of the contract alone does not preserve the old tax treatment.
Practical Example – Price Revision
Suppose goods are supplied under a contract entered into before GST.
After GST begins, the contractual price is revised upwards.
The supplier may be required to issue a supplementary invoice or debit note within 30 days of the price revision under Section 142(2)(a).
If the price is instead revised downwards, a credit note may be issued subject to the conditions in Section 142(2)(b).
Practical Example – Refund of Pre-GST Tax
Suppose a taxpayer paid service tax under the old regime but the service was ultimately not provided.
A refund claim is filed after GST begins.
Section 142(5) provides that the claim is dealt with under the existing law and any amount ultimately payable is refunded in cash, subject to the statutory requirements.
Practical Compliance Considerations
Although Section 142 primarily addresses the transition from the old regime to GST, it remains important when dealing with historical tax disputes, refunds and records.
Businesses handling legacy tax matters should maintain:
- pre-GST contracts;
- invoices;
- excise records;
- service tax records;
- VAT records;
- CENVAT credit records;
- refund applications;
- assessment orders;
- adjudication orders;
- appeal documents;
- review or reference documents;
- proof of payment;
- evidence relating to returned goods; and
- documents supporting transitional transactions.
These records can be important for establishing the legal and factual history of a matter.
Important Lessons From Section 142
Section 142 demonstrates that the introduction of GST was not intended to erase the legal consequences of transactions conducted under the earlier tax laws.
Instead, the law established transitional mechanisms to determine:
- which law applies;
- whether an amount should be refunded;
- whether an amount should be recovered;
- whether old CENVAT credit can be refunded or recovered;
- how price revisions should be documented;
- how old contracts are treated;
- how approval-basis goods are handled; and
- how old tax disputes continue after GST implementation.
The GST Council’s official transition material specifically explains that pending and future claims relating to the existing law, including refunds and recoveries, were addressed through the transitional provisions.
Key Points to Remember About Section 142
The following points provide a quick summary of the section:
- Section 142 is titled Miscellaneous transitional provisions.
- It forms part of Chapter XX of the CGST Act.
- It deals with transactions and proceedings connected with the transition to GST.
- Section 142(1) deals with return of certain goods removed before GST.
- Section 142(2) deals with upward and downward price revisions under pre-GST contracts.
- Upward price revision can require a supplementary invoice or debit note.
- Downward price revision can involve a credit note subject to the statutory ITC condition.
- Section 142(3) deals with refund claims under the existing law.
- Section 142(4) deals with refund claims relating to exports.
- Section 142(5) deals with tax paid under the existing law for services that were not provided.
- Section 142(6) deals with CENVAT credit appeals, reviews and references.
- Section 142(7) deals with output duty or tax liability proceedings.
- Section 142(8) deals with assessment and adjudication proceedings under the existing law.
- Old-law recoveries can, where specified, be recovered as arrears of tax under the CGST Act.
- Section 142(9) deals with revision of returns under the existing law.
- Section 142(10) generally applies GST to supplies made on or after the appointed day under pre-GST contracts, subject to other transitional provisions.
- Section 142(11) prevents or regulates overlapping taxation during the transition from VAT/service tax to GST.
- Section 142(12) deals with goods sent on approval basis before GST.
- Section 142(13) deals with certain pre-GST VAT TDS situations.
- The Explanation to Section 142 preserves specified meanings from the Central Excise framework for Chapter XX.
- Section 142 must be read together with Sections 139, 140 and 141.
- Transitional provisions are particularly important for historical tax disputes, refunds, CENVAT credit and old contractual arrangements.
👉 Read More → Section 142 – Miscellaneous transitional provisions
Conclusion
Section 142 of the CGST Act is an important part of India’s GST transition framework. It provides a detailed mechanism for dealing with transactions and proceedings that originated under the pre-GST tax laws but continued to have consequences after GST came into force.
The section covers a wide range of situations, including the return of goods, upward and downward price revisions, refunds under the existing law, CENVAT credit disputes, output tax proceedings, old assessments and adjudications, revised returns, pre-GST contracts, transitional supplies, approval-basis goods and pre-GST VAT TDS.
One of the most important principles under Section 142 is that the introduction of GST did not automatically terminate the legal consequences of the earlier tax regime. Where an old-law refund, appeal, assessment, adjudication or credit proceeding remained relevant, the transitional provisions determine how that matter should continue to be dealt with.
At the same time, Section 142 establishes a clear distinction between old-law proceedings and post-GST supplies. For example, Section 142(10) generally provides that supplies made on or after the appointed day under contracts entered into before GST are taxable under the GST Act, unless another transitional provision applies. Section 142(11) then deals with particular situations where VAT and service tax had already been attracted during the transition.
For businesses, Section 142 is especially relevant when dealing with historical tax records, old disputes, refund claims, CENVAT credit matters and contracts that crossed the 1 July 2017 GST implementation date. Proper preservation of pre-GST records can be essential for establishing the tax treatment of these transitional transactions.
In simple terms, Section 142 acts as a legal bridge between the old indirect tax regime and GST, ensuring that refunds, recoveries, disputes, price adjustments and transitional supplies are dealt with through specific statutory rules rather than being left unresolved because of the change in the tax system.
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