GST APPLICABILTIY ON VALUE REDUCTION ( ON PREV SUPPLY)

[ABHILASH PANICKER]

Dear Sir/Madam,

Kindly advise is GST Applicable on Value Reduction ., ( that on previous supplies )

Recipient (Customer ) debited only basic amount (Apr to May22)., As they already passed the amount in higher side & GST Benefit taken on full value.

Regards

AI Summary

GST on post-supply discounts: recipient reversals required only if supplier claims GST refund; otherwise no ITC reversal.
Whether GST is triggered by a post supply price reduction depends on whether the reduction adjusts the taxable value of supply and whether tax adjustments are claimed. Post supply discounts can be excluded from value only if agreed at or before supply and linked to invoices, and the recipient reverses ITC attributable to the discount. If the supplier reduces price without claiming GST refund, the recipient need not reverse ITC; if the supplier claims a GST refund for the differential, the recipient must proportionately reverse ITC.