HOW TO RECOVER GST LOSS FOR COMPOSITION GST PAYERS

[Rajnikant Patel]

How to recover GST loss for composition Gst payers?

I have old stock purchased at 12% & 18%... But now I have to sell all the all the old stock at 5% GST or revised reduced MRP... I am at loss of GST which I have already paid while buying goods from Stockiests... 

In such scenario what should I do to recover or reduce loss due to revised GST.

[Rajan Kumar and associates]

Need not to sell at revised MRP

[Rajnikant Patel]

BUT GOVT. HAS ASKED TO SELL AT REVISED MRP... IN THAT CASE I WILL BE AT FAULT... I CANNOT GIVE BACK GOODS TO DISTRIBUTOR

[Sadanand Bulbule]

You cannot recover the GST loss [?] from the Government.

The only practical ways are business negotiations with suppliers, re-pricing, or moving to regular GST in future, if such situations are frequent.

However you must sell the goods at applicable rate under GST-02 reforms. Otherwise Section 171 gets attracted.

[KASTURI SETHI]

Go through Section 12 (1) & (2) of CGST Act.

Tax is to be paid at the rate in force at the time of supply of supply of goods.

Perfect analysis and conclusion by Sh.Sadanand Bulbule, Sir. Well cautioned.

[Rajan Kumar and associates]

Respected Sir,

The query is about Composition Dealer, how it will affect the Composition Dealer?

[Shilpi Jain]

Is the supplier a composition tax payer? If so then on sale GST should be 1%?

If not a composition taxpayer, you can apply for refund under inverted duty structure.

AI Summary

Tax rate at time of supply dictates GST liability; composition dealers must charge revised rate and seek supplier negotiation. Composition taxpayers with old stock purchased at higher GST rates cannot recover embedded tax from the Government; tax liability is determined by the rate in force at the time of supply. Practical responses include supplier renegotiation, repricing, or shifting to regular taxpayer status to protect input credits. Dealers must charge the applicable rate at supply and address losses through commercial or structural measures, failing which transitional and compliance provisions governing supply obligations may be attracted.