<p style="text-align:justify"><span style="font-size:14px"><strong>Question:&nbsp;</strong>We are small traders of textile dealing in Suiting, Shirting, Sarees, Dress Material, Blankets, Dhoti etc. We have some queries regarding implementation of GST from 1st July 2017:-</span></p>

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<ul>
	<li style="text-align:justify">
	<p><span style="font-size:14px">a) What will be the status of opening Stock of Textile items? Will 5% be added on closing stock as on 30th June 2017?</span></p>
	</li>
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	<p><span style="font-size:14px">b) What is the GST rate in Fabrics, as there are various types of fabrics like cotton, synthetics, man-made fabrics, acrylic, Mixture of cotton and other fabrics etc. Will there be flat rate of 5% on all fabrics or different rate?&nbsp;</span></p>
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	<p><span style="font-size:14px">c) Please provide clarification on HSN number. Is it mandatory to quote in invoice by B2C traders &amp; B2B traders? Further there are various codes in one type of item, would it not create confusion among traders? </span></p>
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	<p><span style="font-size:14px">d) As per news in CNBC, input tax credit would not be allowed in textile for some period? Please clarify. </span></p>
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	<li style="text-align:justify">
	<p><span style="font-size:14px">e) Is Rs 1000/- bracket for 18% rate applicable on Sarees and suit lengths or will it attract flat rate?</span></p>
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</ul>

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<p style="text-align:justify"><span style="font-size:14px"><strong><span style="color:#34495e">Answer:</span></strong></span></p>

<p style="text-align:justify"><span style="font-size:14px"><span style="color:#34495e">a) When you make supplies out of this stock after 1st July, 2017 you will be liable to pay tax as applicable to the goods sold by you.</span></span></p>

<p style="text-align:justify"><br />
<span style="font-size:14px"><span style="color:#34495e">(b) GST rate on fabric is flat 5% irrespective of composition.</span></span></p>

<p style="text-align:justify"><br />
<span style="font-size:14px"><span style="color:#34495e">(c) Upto Rs. 1.5 cr turnover, no HSN code is required to be mentioned. For those having turnover of Rs. 1.5 to 5 Cr, first 2 digits of the HSN code are required i.e. the chapter number. Only those who have turnover above Rs. 5 Cr are required to mention 4 digits of the HSN code. You will start getting the HSN code in your supplier&#39;s invoice, so it would not cause any issues once the supplies under new regime take place.</span></span></p>

<p style="text-align:justify"><br />
<span style="font-size:14px"><span style="color:#34495e">(d) ITC would be admissible as per the Transitional provisions of GST Law.</span></span></p>

<p style="text-align:justify"><br />
<span style="font-size:14px"><span style="color:#34495e">(e) Rate of tax linked to the sale value applies only to garments and not for sarees and suit lengths which are fabrics.</span></span></p>