Goods and Services Tax – GST – By: – CA.LALIT MUNOYAT – Dated:- 19-5-2018 Last Replied Date:- 20-5-2018 – Treatment of GST for Credit Note for Discount given post supply Sec 15 (3) provides that he value of the supply shall not include any post sales discount except such discount is established in terms of an agreement entered into at or before the time of such supply and specifically linked to relevant invoices; and input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply. As per sec 34. (1) -Credit & Debit Notes : A supplier may issue to the recipient a credit note for a post sales discount subject to the condition that no reduction in output
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has been passed on to the ultimate consumer. However there is no such presumption while reducing the liability to GST due to issue of credit note. The only requirement is that the input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply. Question At the time of assessment how would the supplier prove that the input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply. There is no way for the supplier to verify it from the recipient. In such a case what will be the consequence if the supplier takes anyone of the following meaures: The supplier issue the credit no
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