How to return the claimed ITC on Purchase return?

[Shravan Kumar]

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?

AI Summary

Input Tax Credit reversal: reduce eligible ITC in subsequent GSTR 3B when supplier issues a credit note.
When a supplier cancels a purchase invoice by issuing a credit note after the recipient has claimed Input Tax Credit, the recipient should reverse that ITC by reducing eligible ITC in the subsequent GSTR 3B Table 4. The supplier records the credit note, reduces its output tax liability and uploads it in GSTR 1. The statutory basis for such adjustment is section 34 of the CGST Act; parties may also issue a tax invoice to effect the goods return.