credit note and debit note, Goods and Services Tax - GST

[Ramakrishnan Seshadri]

Dear Sir,

Good Morning to all experts

We request your clarification on raising debit notes and credit notes under GST regime.

Debit Note:-

We receive parts from our suppliers. On some supplies there is some shortage of parts. In this stage how we have to take into account and whether we have to raise debit note for shortage and based on our debit note our supplier will raise credit note. Is this correct or not. Same is for part rejections also.

Who has to upload the details in the gst returns for this shortage /rejections either us or the supplier.

Request the experts to clarify this issue since it is very much confusing.

Thanks & Regards,

S.Ramakrishnan

Posts / Replies

[MARIAPPAN GOVINDARAJAN]

Take for example you have receive invoice for ₹ 1,00,000/- towards the purchase

If you received goods worth of ₹ 80,000/-; therefore ₹ 20,000/- is shortage

In this scenario credit note may be raised, in my view, either by you or by the seller.

Who issues the credit note has to upload in the GSTR 1 register.

This is my view. Experts views are soliticited.

[Rajagopalan Ranganathan]

Sir,

Section 34 (1) of CGST Act, 2017 stipulates that " where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as may be prescribed." The details to be given in the credit note are given in rule 53 (1) of CGST Rules, 2017. The details of credit notes issued shall be given under Column 9 of GSTR-1. The details are to be uploaded by the registered person who issues credit/Debit note.

According to Section 34 (2) of CGST Act, 2017 " any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed."

Section 34 (3) of CGST Act, 2017 stipulates that " where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a debit note containing such particulars as may be prescribed." The details to be given in the debit note are given in rule 53 (1) of CGST Rules, 2017. The details of debit notes issued shall be given under Column 9 of GSTR-1

Section 34 (4) of CGST Act, 2017 stipulates that " any registered person who issues a debit note in relation to a supply of goods or services or both shall declare the details of such debit note in the return for the month during which such debit note has been issued and the tax liability shall be adjusted in such manner as may be prescribed."

[KASTURI SETHI]

Dear Querist,

Either you may issue debit note or your supplier may issue credit note. Invoice no. should be mentioned on debit/credit note. Also support the views of both experts.

[Ganeshan Kalyani]

Credit note to be uploaded by the supplier only.

[Himansu Sekhar]

Supplier will issue credit note and upload in gstr1. You will reverse the credit. Then his liability will reduce. Sec 34 may be referred

[Ganeshan Kalyani]

Since you are receiving lesser quantity. The input tax credit also you are supposed to claim lesser than the tax mentioned on the invoice.