GST Rate on goods return/Credit note after Increase in rate

[ROHIT GOEL]

Dear Experts,

Party A had received goods on 15th Sep 2025 at rate of 12% however thereafter GST Rate was increased to 18%. Now, Party A wants to return the goods. My query is:

a) What rate should be charged on credit note-12% or 18%

b) Legal citation/provision which specifically addresses this situation

The doubt arises because if the return is treated as a new supply then rate applicable on return date should be charged. However, on flip side, supplier earlier paid 12% GST on o/w supply then how we can claim back 18% GST from govt via credit note. Kindly shed some clarity.

AI Summary

Credit note linkage to original invoice requires applying the tax rate charged on the original supply, not the later rate.
A credit note serves as an adjustment to the original tax invoice and must reflect the taxable value and tax charged on that original invoice; thus the supplier should issue the credit note consistent with the rate and tax amount on the original sale. An alternative view treats the return as a fresh supply, in which case the prevailing rate at the time of that supply would apply.