Free replacement

[MohanLal tiwari]

Dear Panelist,

We have supplied goods during Pre-GST regime which got rejected and needs to be replaced free of charge before lifting back the rejected goods.The customer needs Invoice copy for free replacement to issue way bill.

[ANITA BHADRA]

Dear Sir

If the amount of invoice exceeds ₹ 200 only then it is mandatory to prepare ‘Tax invoice’..section 31 of the. CGST Act, 2017.

And as far as way bill is concerned , Way bill need to issue for value for more than ₹ 5000

[CSSANJAY MALHOTRA]

Delivery challan is required for Free Replacement as the same is not covered under SUPPLY in GST.

[Himansu Sekhar]

The goods can be replaced free of cost without paying the gst. Even there is no need to reverse the credit on the free supply.it has been clarified in the FAQ. This also applicable to the pre gst supplies.

[KASTURI SETHI]

Dear Querist,

"Invoice" and "Free replacement" cannot go simultaneously in this situation. As suggested by Sh.CS Sanjay Malhotra, Sir, delivery challan will serve the purpose. Delivery challan can be correlated with the invoice issued initially.

AI Summary

Free replacement: use a delivery challan and do not treat the replacement as a taxable supply where no consideration exists. Free replacement of pre GST supplies that is gratuitous is not a taxable supply; GST need not be paid and input tax credit need not be reversed. A delivery challan should be used for the free replacement and correlated with the original invoice for traceability. Tax invoices and waybills are required only where statutory monetary thresholds for invoicing and movement are met.