Warranty Charges

[Kaustubh Karandikar]

XYZ(India) importing goods from PQR (Japan) which is a parent company. XYZ re-selling these goods to customers in India. During warranty period, if any defect found in these goods, XYZ giving free replacement to the customers in India and the amount for the same is recovered from PQR as reimbursement of warranty charges. Is XYZ required to pay GST on it? If yes under which provisions?

AI Summary

XYZ's GST Obligation on Warranty Charge Reimbursements from Parent Company PQR in Japan Explained Under Previous Discussion ID. XYZ, an Indian company, imports goods from its parent company PQR in Japan and resells them in India. If defects are found during the warranty period, XYZ provides free replacements to Indian customers and gets reimbursed by PQR for the warranty charges. The query concerns whether XYZ must pay Goods and Services Tax (GST) on these reimbursements and, if so, under which provisions. The response indicates that this issue has been previously addressed under a different discussion ID.