Return of goods post GST supplied under Excise invoice

[MohanLal tiwari]

We are regularly supplying goods to PSUs namely Bhilai Steel Plant & NALCO, we have some rejections against supplies of pre-GST regime for free replacement.

Both PSUs are insisting for lifting back the rejected materials under their gate pass. They are not willing to issue any Tax (GST) Invoice for rejection return and wants replacement under GST invoice. Please advise how to get credit on our own invoice under Trans-1 scheme and supply goods under GST invoice.

[KASTURI SETHI]

Pl. Go through the reply filed by Sh. Prajapati, an expert two days ago in this forum.

[Himansu Sekhar]

Please intimate them about the proviso to section 142(1), the liability is up on the PSU to pay the tax.

AI Summary

Return of goods under GST: use Trans 1 to preserve transitional credit; recipient bears tax liability on returns.
Return of goods supplied under excise invoices and rejected by recipients should be documented and replacement supplies made under GST invoices, while suppliers preserve transitional input tax credit by filing a Trans 1 declaration. If recipients decline to issue a tax invoice for the return, the proviso to section 142(1) places the tax liability on the recipient, so suppliers should rely on Trans 1 for credit rather than accepting gate pass returns without invoicing.