Authority rejects application for advance ruling due to lack of jurisdiction on input tax credit reversal & commercial credit notes.

The Authority rejected the application for advance ruling as it did not have jurisdiction to address the questions raised by the applicant regarding the reversal of input tax credit and issuing commercial credit notes without charging GST. The ruling emphasized the limitations of the Authority's scope in providing rulings on matters that did not fall within the specified sections of the GST Act.

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Issues:
1. Whether the dealer is required to reverse input tax credit proportionate to the reduction in the value of supplyRs.
2. Whether the applicant can issue commercial credit notes to its dealers for post-sale discounts without charging GSTRs.

Analysis:

Issue 1:
The applicant sought an advance ruling regarding the reversal of input tax credit by dealers in case of post-sale discounts. The applicant contended that dealers should not reverse the credit as they have reimbursed the GST on the undiscounted transaction value at the time of supply. The Authority noted that the question raised by the applicant was not within the purview of Section 95 of the GST Act, as it pertained to the dealers and not the applicant. The Authority referenced a previous case to highlight that the question must be raised by the concerned dealer. Therefore, the Authority held that it was not allowed to answer the question raised by the applicant.

Issue 2:
The second query was related to whether the applicant could issue commercial credit notes to dealers for post-sale discounts without charging GST. The Authority stated that the question did not fall under the matters specified in Section 97(2) of the CGST Act. The Authority highlighted that Section 97(2) dealt with specific issues for which an advance ruling could be sought, and the procedure the applicant wanted to follow was not covered. Consequently, the Authority concluded that it did not have jurisdiction to rule on such matters. As a result, the application for advance ruling was deemed non-maintainable, and the Authority rejected the application.

In conclusion, the Authority rejected the application for advance ruling as it did not have jurisdiction to address the questions raised by the applicant. The ruling emphasized the limitations of the Authority's scope in providing rulings on matters that did not fall within the specified sections of the GST Act.

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