credit note

[srinivasulu m]

I have issued B2B invoice on services but the recipient has not given the tax amount now can I give a credit note if so can I give a credit note for the tax amount?

[Padmanathan KV]

Please peruse section 34 (1) which reads as under:

34. (1)Where one or more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient one or more credit notes for supplies made in a financial year containing such particulars as may be prescribed.

(2) Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than the thirtieth day of November following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed:

Provided that no reduction in output tax liability of the supplier shall be permitted, if the incidence of tax and interest on such supply has been passed on to any other person.

Considering the above provisions, it does not seem like a fit case to issue a credit note provided under section 34 (1). The recourse in your case would be to initiate legal actions against your recipient.

AI Summary

Can a Credit Note Be Issued for Unpaid Tax on B2B Services? Consult Section 34(1) for Guidance. An individual inquired about issuing a credit note for tax on a B2B service invoice where the recipient hasn't paid the tax. The response advised consulting Section 34(1) of Indian tax law, which allows issuing a credit note if the taxable value or tax charged exceeds the payable amount, or if goods/services are returned or deficient. However, it was noted that this situation might not qualify for a credit note under the specified provisions, suggesting legal action against the recipient as a possible recourse.