Credit note, Goods and Services Tax - GST

[AKHIL MITTAL]

ARP wants to give quantities discount to its dealers by issuing credit note, Can he do so with out affecting GST/ without reversing GST. If yes, will the income of other party attract GST

Posts / Replies

[KASTURI SETHI]

Yes, quantity discount can be given by issuing credit note. It is covered under Section 15(3) of CGST ACT, 2017. It is subject to the fulfillment of conditions laid down therein. It should be prior (or at the time of supply) known to the buyer. Also go through Flyer No.15 dated 1.1.18 issued by the Board. Invoice, agreement regarding discount plus books of accounts are supporting evidence and must be correlated.

Reversal of ITC on the value of discount is required.

[YAGAY ANDSUN]

Pre announced discount policy is required to substantiate such discounts etc. under GST regime otherwise tax benefit would not be available.

[DR.MARIAPPAN GOVINDARAJAN]

I endorse the views of Yagay and Sun

[AKHIL MITTAL]

THANKS FOR THE REPLY. THE DISCOUNT POLICY WAS DECIDED AT THE TIME OF SALE, BUT WE ARE MANUFACTURER OF FOOTWEAR & DON'T WANT TO REVERSE THE GST AS THE REFUND UNDER INVERTED DUTY STRUCTURE HAS ALREADY BEEN CLAIMED. CAN WE ISSUE CREDIT NOTES WITHOUT REVERSING GST PLEASE REPLY SPECIFICALLY.

[YAGAY and SUN]

Yes you can, but only if your customer do not revert the ITC.