Dear Experts,
During recent internal audit of Mr. X, it came to notice that in FY 2021-22, rates on some of his sale items was increased from 12% to 18% however he continued to charge old rate of 12% on sale invoices. GSTR--1, 3B and GSTR-9/9C was filed timely by him and credit passed on at 12% only. Now Mr. X intends to correct this mistake and pay differential tax with interest.
Your opinion is required on following:
1. Whether Mr. X can issue debit note to Customers for differential tax of 6% for FY 21-22 now in April 2023? (I could not find any restriction in section 34 about time limit)
2. If yes, whether customers would be able to take ITC of such debit note as per section 16(4)? (As per 16(4), ITC of a invoice or debit note can be claimed till 30th November of year following the year to which the invoice or debit note relates to. Admittedly, debit note relates to FY 2021-22 but is being issued in April 2023, hence the confusion)
Kindly share your valuable views.