GST impact on Excess Stocks Account booking(Physical stock is excess then books)

[Prem Choudhary]

Dear Expert

please advice gst impact on following query:-

In physical verification of stock(Raw materials) it was found that the physical is excess over books. please advice on:-

1. if excess stock account for in books, what are consequences in GST ? and

2. if supply of stock was made from sister Concern unit then, GST consequences ?

AI Summary

Record-keeping obligations under GST can trigger penalties and scrutiny when physical stock exceeds book records, requiring reconciliation.
Discrepancies where physical stock exceeds books trigger GST record keeping obligations and can attract penalties under CGST/SGST for procedural non compliance even absent revenue loss; tax applies on supply, so excess stock accounted after verification requires reconciliation, corrective accounting, and documentation to demonstrate absence of undisclosed supply, otherwise departmental scrutiny, tax adjustments and penalties may follow.