TMI BlogCircular to clarify the procedure in respect of return of time expired drugs or medicines.X X X X Extracts X X X X X X X X Extracts X X X X ..... in the implementation of the law across the field formations, the Commissioner, in exercise of its powers conferred by section 168 of the Assam Goods and Services Tax Act, 2017 (hereinafter referred to as the Assam GST Act ), hereby clarifies the issue in succeeding paragraphs. 2. The common trade practice in the pharmaceutical sector is that the drugs or medicines (hereinafter referred to as goods ) are sold by the manufacturer to the wholesaler and by the wholesaler to the retailer on the basis of an invoice/bill of supply as case may be. It is significant to mention here that such goods have a defined life term which is normally referred to as the date of expiry. Such goods which have crossed their date of expiry are colloquially re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d goods by issuing any commercial document without charging any tax on the same. d) Where the time expired goods which have been returned by the retailer/wholesaler are destroyed by the manufacturer, he/she is required to reverse the ITC availed on the return supply in terms of the provisions of clause (h) of sub-section (5) of section 17 of the Assam GST Act. It is pertinent to mention here that the ITC which is required to be reversed in such scenario is the ITC availed on the return supply and not the ITC that is attributable to the manufacture of such time expired goods. Illustration : Supposedly, manufacturer has availed ITC of ₹ 10/- at the time of manufacture of medicines valued at ₹ 100/-. At the time of return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so availed against the goods being returned. c) However, if the time limit specified in sub-section (2) of section 34 of the Assam GST Act has lapsed, a credit note may still be issued by the supplier for such return of goods but the tax liability cannot be adjusted by him in his hands. It may further be noted that in case time expired goods are returned beyond the time period specified in the subsection (2) of section 34 of the Assam GST Act and a credit note is issued consequently, there is no requirement to declare such credit note on the common portal by the supplier (i.e. by the person who has issued the credit note) as tax liability cannot be adjusted in this case. d) Further, where the time expired goods, which have been return ..... X X X X Extracts X X X X X X X X Extracts X X X X
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