Post sale discounts: conditional incentives are taxable supplies of services, while unconditional discounts adjust original supply value. Post sale discounts without dealer obligations relate to the original supply and may be excluded from the supplier's value under section 15(3); discounts conditional on dealer promotional activity are a separate supply of services by the dealer and attract GST with corresponding ITC to the supplier. Discounts paid to enable dealer price reductions are consideration for the dealer's supply and must be added to the dealer's value under section 15; customers may claim ITC only to the extent of tax paid. Where discounts cannot be excluded and commercial credit notes are issued, the supplier cannot reduce original tax liability, yet the dealer need not reverse ITC if he pays the reduced value after adjusting credit notes and the original tax charged.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Post sale discounts: conditional incentives are taxable supplies of services, while unconditional discounts adjust original supply value.
Post sale discounts without dealer obligations relate to the original supply and may be excluded from the supplier's value under section 15(3); discounts conditional on dealer promotional activity are a separate supply of services by the dealer and attract GST with corresponding ITC to the supplier. Discounts paid to enable dealer price reductions are consideration for the dealer's supply and must be added to the dealer's value under section 15; customers may claim ITC only to the extent of tax paid. Where discounts cannot be excluded and commercial credit notes are issued, the supplier cannot reduce original tax liability, yet the dealer need not reverse ITC if he pays the reduced value after adjusting credit notes and the original tax charged.
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