credit note and debit note

[Ramakrishnan Seshadri]

Dear Sir,

Good Morning to all experts

We request your clarification on raising debit notes and credit notes under GST regime.

Debit Note:-

We receive parts from our suppliers. On some supplies there is some shortage of parts. In this stage how we have to take into account and whether we have to raise debit note for shortage and based on our debit note our supplier will raise credit note. Is this correct or not. Same is for part rejections also.

Who has to upload the details in the gst returns for this shortage /rejections either us or the supplier.

Request the experts to clarify this issue since it is very much confusing.

Thanks & Regards,

S.Ramakrishnan

AI Summary

Credit note issuance governs adjustment of overstated tax or deficient supplies and must be reported by the issuer in returns.
Where an invoice overstates taxable value or tax or goods are returned/deficient, the supplier may issue a credit note and must declare its details in the outward-supply return (GSTR-1) in the prescribed column within the month of issue subject to the outer time limit; where an invoice understates taxable value or tax, a debit note regime applies and the issuer must declare the debit note in the return for the month of issue. The issuer is responsible for uploading the document and recipients must adjust input tax credit for shortages, rejections or returned goods.