Post-sale discounts via financial credit notes and GST input tax credit reversal-when ITC stands, and valuation shifts

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Full Text of the Document

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....Input tax credit under the WBGST Act need not be reversed by a recipient where payment is reduced due to financial/commercial credit notes issued for secondary/post-sale discounts, because such credit notes do not reduce the original transaction value or the supplier's tax liability and therefore do not reduce tax charged. A manufacturer's post-sale discount to a dealer is not "consideration" for the dealer's onward supply to an end customer where there is no manufacturer-end customer agreement and the discount merely reduces the dealer's sale price; consequently, no additional GST consequence arises on that ground. Where the manufacturer has an agreement with an end customer and funds the dealer's discounted sale, the discount forms part o.........