GSTR 1 and 2B in case of wrong filing by the party

[Ramanathan Seshan]

Dear Experts,

I'm seeking your help to attain clarity:

Consider a situation where Mr. A, a GST-registered vendor, has two GST-registered customers: B (an existing customer) and C (a new customer). During the onboarding process of C, Mr. A mistakenly entered B's GST number in the system for C.

Now, let's consider the following:

1. In January, Mr. A did not make any sales to B but made an IGST tax value of Rs. 100 to C. Due to the error during onboarding, Mr. A filed his GSTR-1 under B's name instead of C's. What steps can Mr. A take to correct this mistake in his GST returns?

2. In the same month (January), B's GSTR-2B shows the invoice. Should Mr. A permanently reverse the Rs. 100 in 4B(1), or should he adjust it by reducing Rs. 100 in 4A(5)? Also, if B’s total ITC in 2B is Rs. 500, should Mr. A only report Rs. 400, knowing that Rs. 100 of the ITC is not valid for him?

3. Can Mr. A issue a credit note for the above, to correct the error and report it in the CDNR section of his GSTR-1 in the following month regarding B?

4. Suppose Mr. A made an IGST tax value of Rs. 200 to Mr. B. What actions should Mr. A and Mr. B take in terms of GSTR-1 and GSTR-2B reporting and further course of action

Regards,

S Ram

[Shilpi Jain]

In case of a GST error, it is better to issue a credit note or make an amendment to the invoice in GSTR-1

[Ramanathan Seshan]

Dear Shilpi-mam,

Thanks for your response.

Regards,

S ram

AI Summary

GST invoice correction: supplier must amend GSTR 1 or issue credit note and recipient adjust ITC accordingly. Where an outward supply was reported to the wrong recipient because of an incorrect GSTIN, the supplier should amend the originally filed GSTR 1 or issue a credit note and report it in the appropriate amendment/credit note section in the subsequent return period to reallocate the supply. The recipient must reconcile its 2B against the supplier's amendment and, if the ITC is not valid, reverse or adjust the input tax credit in its returns to align with the supplier's correction.