Section 20 UTGST Act - Miscellaneous Transitional Provisions
Section 20 of the Union Territory Goods and Services Tax Act, 2017 governs legacy tax matters arising from the transition to GST, including returned goods, price revisions, refunds, appeals, assessments, revised returns, supplies under pre-GST contracts, goods sent on approval and tax deduction at source.
Section 20 - Statutory provisions
The following reproduces the substantive clauses and provisos of Section 20 as supplied, with line wrapping and obvious transcription errors normalized. For authoritative wording and amendments, consult the official legislation linked below.
(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 claim 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.
(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.
(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. (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, 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.
Meaning and practical application
Returned goods and price changes - subsections (1) and (2)
Subsection (1) deals with qualifying goods sold under the earlier law and returned after GST commenced. It distinguishes returns by unregistered persons, potentially giving rise to a refund under the previous law subject to the statutory conditions, from returns by registered persons, which are treated as supplies. Subsection (2) addresses upward and downward revisions to the price of goods under pre-GST contracts, including supplementary invoices, debit notes and credit notes, with the stated thirty-day requirement and conditions for reducing tax liability.
Refunds and pending proceedings - subsections (3) to (8)
Refund claims under the existing law, including claims concerning exports, continue to be handled under that law, subject to restrictions on double benefit where credit was already carried forward. Appeals, reviews, revisions, assessments, adjudications and revisions of earlier returns are similarly dealt with under the relevant existing law. Depending on the result, amounts may be refunded in cash or recovered as arrears under UTGST. Recovered or rejected amounts are not automatically eligible for new GST input tax credit.
Pre-GST contracts and prevention of double taxation - subsections (9) and (10)
Supplies made after the appointed day under contracts signed earlier are generally subject to the new law unless a specific transitional exception applies. Subsection (10) coordinates tax already leviable under previous sales tax or service tax provisions, including the special treatment of transactions taxed under both systems. These clauses should be read alongside the applicable time-of-supply provisions in Section 21 of the UTGST Act and Sections 12 and 13 of the CGST Act.
Approval goods and TDS - subsections (11) and (12)
Goods sent on approval shortly before GST commenced had a prescribed return window, with a limited extension mechanism and tax consequences for late or non-return. The TDS transitional provision prevents a second deduction under Section 51 of the CGST Act, as applied to UTGST, for qualifying pre-GST invoiced sales where tax deduction was required under the former law.
Important expressions and connected provisions
Existing law refers to the applicable pre-GST law for the relevant transaction. Appointed day refers to the commencement of the applicable transitional GST provisions. The concluding explanation in Section 20 adopts the meaning of capital goods from an existing law relating to sale of goods. For the wider UTGST framework, see Section 2 (definitions), Section 17 (migration), Section 18 (transitional credit) and Section 19 (job work).
Claims and disputes depend on the applicable former law, documentation, limitation periods, notifications, rules and relevant decisions. A transitional provision should not be read as creating an unrestricted right to claim historical credits or refunds today.
Official law and updates
Refer to the Union Territory Goods and Services Tax Act, 2017 (India Code), the CBIC Tax Information Portal for legislation and notifications, and the CBIC GST website for related rules and circulars. For cross-applied CGST provisions and transitional procedures, consult the current official consolidated texts and relevant notifications.
Reviewed 6 October 2026. Transitional provisions relate primarily to the original 2017 GST implementation.