Invoice - GST

[VIGNESH]

sir. my client has sold goods to a party and we have declared the same in GSTR-1, and now he is not paying the bill amount and my client has sued the party .my question

1. Should i pay the GST amount on the bill raised which is disputed?

2. if i reverse the bill by credit note will it be legally tenable?

3. can i raise a credit not for GST Tax amount alone?

[PAWAN KUMAR]

dear sir, as per my view :

it is better to issue credit note and adjust the credit note reducing your gst liability.

[KASTURI SETHI]

I am also of the same view as opined by Sh.Pawan Kumar Ji.

[Shilpi Jain]

Bad debts cannot be a reason for issue of GST credit note as the supply has happened which triggers the levy. The department would dispute this.

However, if the amount gets settled for a lesser amount you could issue CN considering it attracts deficiency

[PAWAN KUMAR]

no department will not issue any notice in this regard.

[Ganeshan Kalyani]

I agree with the views of the expert.

AI Summary

GST liability on disputed invoices: adjust via credit note only where consideration is formally reduced, not for bad debt alone. Whether GST remains payable after a declared sale in GSTR 1 when the buyer disputes payment, and whether issuing a credit note can reduce the supplier's GST liability. Opinions diverge: some advise issuing a credit note to adjust liability; others warn that bad debt alone does not justify a credit note because the supply triggered tax, though a settlement for a lesser amount could support issuance as an adjustment of consideration rather than sole tax reversal.