CREDIT NOTE

[AKHIL MITTAL]

THANKS FOR THE REPLY. THE DISCOUNT POLICY WAS DECIDED AT THE TIME OF SALE, BUT WE ARE MANUFACTURER OF FOOTWEAR & DON'T WANT TO REVERSE THE GST AS THE REFUND UNDER INVERTED DUTY STRUCTURE HAS ALREADY BEEN CLAIMED. CAN WE ISSUE CREDIT NOTES WITHOUT REVERSING GST PLEASE REPLY SPECIFICALLY.

[DR.MARIAPPAN GOVINDARAJAN]

In my view it is not possible.

[KASTURI SETHI]

You cannot enjoy the benefits of both worlds. I agree with the views of Dr.Govindarajan Sir.

[YAGAY and SUN]

In our view it is possible, provided your customer do not revert the ITC. Law is very specific in this regard.

[CSSANJAY MALHOTRA]

Yes, credit notes can be issued without charging GST as none stands to loose. You are neither claiming reduction in your output tax liability nor your client is reversing same. Govt revenue is not impacted.

This is the best option majority of industrial players follow.

[YAGAY and SUN]

This practice is practical and convenience and hence is being followed by the majority of assessee.

AI Summary

Credit note issuance without GST reversal may be possible if recipient does not reverse input tax credit, affecting tax compliance.
Issuance of credit notes under GST raises whether a manufacturer may reflect a pre-determined discount without reversing the originally discharged GST liability; practitioners differ-some require GST reversal on reduction of taxable value, while others permit non-reversal provided the recipient does not reverse the input tax credit, making the approach contingent on reciprocal tax adjustments by supplier and recipient.