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Issue Id: - 113197
Dated: 14-12-2017

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Respected Sirs,

We are receiving bills for Raw Materials supply from GST registered persons with GST charged bills.

After receipt at our end, we found some discrepancies in their GST bill such as Insurance, Freight and Price difference and short supply etc... Shall we raise Debit Note to our suppliers for the taxable value to be deducted + GST ???

We were informed that we do not have rights to raise Debit Note for the goods purchased by us and only the supplier of goods (seller) has to give Credit Note ONLY. Kindly clarify whether we can raise Debit Note or Only seller has to give Credit Note or both are allowed for our debits to be made.

Likewise, against our supplies (sales) made, we want to raise Credit Note on Trade Discount to our customers for prompt payments or early payments. This is after sales only and we have not mentioned any Trade Discount in our Tax Invoices. If we raise Credit Note, where GST to be added with Discount amount. If we add GST, party will make payment after deducting Discount+GST amount (that is Credit Note Value). If so, what we have to do in GST portal for GST on discount amount in GSTR-3B. Shall we take back that GST available in Credit Note as ITC. Whether we have to add GST on Discount amount and we can give Credit Note for Discount value only without GST.

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Showing Replies 1 to 2 of 2 Records

1 Dated: 14-12-2017
By:- Vamsi Krishna

In your first case, As per sec. 34(3) ,

A debit note should be issued by a supplier in the following circumstances:

(a) The taxable value shown in the invoice is lesser than the taxable value of the supply; or

(b) The tax charged in the invoice is less than the tax payable on the supply.

Also note that :

A debit note has to be issued by the supplier. A debit note issued by a recipient, say for accounting purposes, is not a relevant document for GST purposes;

The details of the debit note have to be declared by the supplier in the return of the month of the issue of debit note.

And for the later case, where intend to give discount, you have to issue Credit note with GST.

GST can be reversed for the value of discount and by mentioning it in GSTR 3B or GSTR-1 your liability to that extent shall get reduced.

Pls refer Sec.34 of CGST Act for better understanding.

2 Dated: 14-12-2017

Respected Sir,

Thanks for your reply regarding our query on Debit Note and Credit Note.

In that you have mentioned lastly, that the GST on Trade Discount shown in our Credit Note should be posted in GSTR-3B or GSTR-1. We will check. I think there is only provision for ITC reversal and there is no provision for reducing liability. Anyway, I will check. Thanks for reply.

My first querry, regarding the GST paid on Factory Building repairing charges can be availed ITC.

Please note it is not a new construction, it is not a contract, it is not an admin building construction.

It is only repairing of old existing Factory Building such as renovation, painting, debris removal.

You can very well clarify since you are the master in the matter of construction company and related GST - ITC


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