Cenvat credit reverse against Discount

[RAM SHARMA]

Dear Experts,

We are a manufacturer unit. We are availing extra discount on some input services after cross the certain limit. Whether we have to reverse cenvat credit on such input services due to raise the debit note for availing the discount. Pl advice.

Thanks

AI Summary

Cenvat credit reversal hinges on whether a post transaction discount alters the duty paid element or evidences recovery of tax.
Reversal of CENVAT credit for subsequent discounts on input services depends on whether the supplier recovers the duty component or the credit/debit note evidences alteration of the duty-paid character. If the supplier merely adjusts the transaction value without reference to duty, no reversal is required; reversal arises when the duty incidence is disturbed or unjust enrichment is shown. Credit/debit notes are primary evidence, and under GST the same principles and evidentiary focus on recovery of tax and unjust enrichment will apply.