Clarification on various doubts related to treatment of secondary or post-sales discounts under GST

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....)/Policy-GST/2019 /518-24        Dated: 19/11/2019 CIRCULAR NO. 6/2019-GST (Ref. Circular No. 105/24/2019-GST of Central Tax) Subject: Clarification on various doubts related to treatment of secondary or post-sales  discounts under GST - reg. Circular No. 92/11/2019-GST dated 7th March, 2019 was issued providing clarification on various doubts....

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....rue nature of discount given by the manufacturer or wholesaler, etc. (hereinafter  referred to as "the supplier of goods") to the dealer. It would be important to examine whether the additional discount is given by the supplier of goods in lieu of consideration for any additional activity / promotional campaign to be undertaken by the dealer. 3.  It is clarified that if the post-sale ....

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.... would be in relation to supply of service by dealer to the supplier of goods. The dealer, being supplier of services, would be required to charge applicable GST on the value of such additional discount and the supplier of goods, being recipient of services, will be eligible to claim input tax credit (hereinafter referred to as the "ITC") of the GST so charged by the dealer. 4.  It is furt....

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....econd proviso to subsection (2) of section 16 of the DGST Act. 5.  There may be cases where post-sales discount granted by the supplier of goods is not permitted to be excluded from the value of supply in the hands of the said supplier not being  in accordance with the provisions contained in sub-section (3) of section 15 of DGST Act. It has already been clarified vide Circular No. 92....