Input tax credit survives post-invoice discounts when credit notes preserve original invoice tax components, requiring reassessment of credit denial.

Input tax credit on tax paid under original purchase invoices cannot be denied solely because the purchasing dealer later receives a post-invoice discount or sales incentive. The amended rule requires the selling dealer to issue a credit note without altering the tax component of the original tax invoice, preserving both the buyer's input tax credit and the seller's output tax liability. It does not confine recognition of discounts to those recorded in the original invoice. Accordingly, a credit denial based only on the absence of the subsequent discount from that invoice is unsustainable and requires reconsideration under the amended rule.

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Issues: Whether input tax credit on tax paid under original purchase invoices could be denied merely because the purchasing dealer subsequently received discounts from the seller.

Analysis: The amended rule governing credit notes for post-invoice discounts or sales incentives requires the selling dealer to issue the credit note without disturbing the tax component in the original tax invoice, thereby retaining the buying dealer's input tax credit and the seller's output tax. The assessment proceeded on the premise that a discount could be recognised only where shown in the invoice. That premise was inconsistent with the rule, which does not restrict consideration of discounts to those reflected in the invoice.

Conclusion: Denial of input tax credit solely on the ground that the subsequent discount was not shown in the original invoice was unsustainable; the claim requires reconsideration under the amended rule.

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