An invoice raised in the month of June 2018 has been canceled by raising Credit note in July 2018 by a vendor. We have claimed ITC in the June 2018 for the received invoice.
As the vendor cancelled the Invoice by raising Credit note, how we can return the ITC claimed in June for the said invoice?
Reversing Input Tax Credit on Canceled Invoices: Guidance Under Section 34 of CGST Act Explained with Examples. A user inquired about reversing the Input Tax Credit (ITC) claimed on a purchase after a vendor canceled an invoice by issuing a credit note. A respondent suggested reducing the ITC in the subsequent GSTR-3B return. The user questioned this approach, expressing concern about justifying the reduced claim. Another respondent explained with an example that adjusting ITC in the following month's return results in a net zero effect on both ends. It was noted that Section 34 of the CGST Act, 2017, provides the legal basis for reversing ITC. Another participant agreed with the suggested method, and it was mentioned that a tax invoice could be issued to return goods. (AI Summary)
TaxTMI 
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