Value and tax payment condition under provio to Section 16(2)of CGST AcT, Goods and Services Tax - GST

[Nikhil Virkar]

Whether Adjustment thru debit and credit note i/r/o non-related party supply transaction tantamount to payment of value and tax as envisaged under proviao ro section 16(2)of CGST AcT to confirm the admissibility of ITC

Posts / Replies

[KASTURI SETHI]

Only debit note and credit note  would not suffice. Such notes must be supported by basic docs required for availment of ITC as specified in  Rule 36  of CGST Rules read with Section 34 of CGST Act.

[Nikhil Virkar]

Sir, my question is regarding adjustment of payments through debit and credit notes instead of making payment to each other of full bills, when the recipient is wanted to adjust / recover from a specific amount against bill of vendor.  Say - Supplier raised bill for Rs. value 100 + GST 18= total Rs. 118 on recipient.  Recipient want to recover bank charges Rs. 10/- from the supplier out of his bill amount.  Scenario 1:-  If recipient deduct Rs. 10/- if pay 108/- to the supplier, whether recipient will eligible to claim entire amount of ITC?  Scenario 2 :- If recipient raised financial debit note for Rs. 10/- and make payment of Rs. 108/-, whether entire ITC is available to the recipient?