Rate difference Debit Note to Labour Service provider

[Nihal Shaikh]

Dear Sir,

Our business type is Steel trading & we doing transactions of purchase and sale of steel only (no other service).

We had taken Labour service from a Labour Service provider and he charged us extra rate in his GST bill

Now we want to raise a debit note of a rate difference on him, In this debit note should we charge him GST? OR without GST?

AI Summary

Supplier-issued credit note required for correcting excess tax charges; recipient cannot unilaterally alter supplier tax liability.
Adjustments for excess rate or tax charged must be made by the supplier through a legally compliant credit note or revised tax invoice containing rule-prescribed particulars; the recipient cannot issue a statutory credit/debit note to alter the supplier's tax liability. Recipients may avail input tax credit of tax shown in supplier invoices, but such availment is limited to the supplier's actual tax liability and entails compliance risk if the supplier has overcharged. Proper books, correct invoice descriptions, and mutual reconciliation via prescribed debit/credit note mechanisms are required.