{"id":4136,"date":"2020-03-26T03:52:57","date_gmt":"2020-03-26T03:52:57","guid":{"rendered":"https:\/\/commerceiets.com\/?p=4136"},"modified":"2020-03-26T03:52:57","modified_gmt":"2020-03-26T03:52:57","slug":"credit-note","status":"publish","type":"post","link":"https:\/\/commerceiets.com\/credit-note\/","title":{"rendered":"CREDIT NOTE"},"content":{"rendered":"\n<h2 class=\"has-text-align-center wp-block-heading\" id=\"meaning\"><strong>MEANING<\/strong><\/h2>\n\n\n\n<p>Credit Note is a document that is issued by a registered person under section 34(1) of CGST Act 2017 when supplies are returned or found deficient, or decrease in taxable value or <a rel=\"noreferrer noopener\" aria-label=\"GST (opens in a new tab)\" href=\"https:\/\/commerceiets.com\/gst\/\" target=\"_blank\">GST<\/a> charged in invoice. The tax liability of the supplier will reduce, as and when the Cr. Note is issued by the registered person.<\/p>\n\n\n\n<p>Sometimes, the purchaser is unhappy with the quality of product shipped to him. In that case, he shall return the goods to the supplier, and in return, the supplier issues the purchaser, credit notes to the extent of the value of the goods being returned. There is no predefined format in which the credit note has to be issued; rather it is an intimation to the purchaser about such credit being offered.<\/p>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>ISSUANCE SECTION 34(1)<\/strong><\/p>\n\n\n\n<p>Where a Tax Invoice has been issued for\nsupply of goods or services or both and;<\/p>\n\n\n\n<ul><li>the value declared in the invoice is more\nthan the actual value of the goods or services provided; or<\/li><li>the rate of GST or Tax amount charged is at a\nhigher&nbsp; rate than what is applicable for the kind of goods or services\nsupplied; or<\/li><li>the quantity received by the recipient is\nless than what is mentioned in the tax invoice; or<\/li><li>the goods supplied are returned by the\nrecipient;<\/li><\/ul>\n\n\n\n<p>then the registered person, who has supplied such goods or services or both, shall issue a Cr. Note to the recipient.<\/p>\n\n\n\n<p>Once the Cr. Note is issued, the tax liability of the supplier will reduce.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"582\" height=\"314\" src=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/image-91.png\" alt=\"\" class=\"wp-image-4140\" srcset=\"https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/image-91.png 582w, https:\/\/commerceiets.com\/wp-content\/uploads\/2020\/03\/image-91-300x162.png 300w\" sizes=\"(max-width: 582px) 100vw, 582px\" \/><\/figure>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>TIME OF ISSUE OF CR. NOTE<\/strong><\/p>\n\n\n\n<p>Credit Note can be issued anytime\nthat is there is no prescribed time limit for issuing them. Credit Notes that\nare issued should be declared in the returns of GST filed.<\/p>\n\n\n\n<p>Credit Note is to be furnished in\nreturn for the month for which such note has been issued before:<\/p>\n\n\n\n<ul><li>September following the end of the financial year in which such supply was made or<\/li><li>the date of furnishing of Annual return<\/li><\/ul>\n\n\n\n<p>Whichever is earlier, and the\nliability of the tax should be adjusted in the manner prescribed.<\/p>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>FORMAT OF CREDIT NOTE<\/strong><\/p>\n\n\n\n<p>There is no prescribed format for Credit\nNote. However, it must contain prescribed Particulars same as a Revised Tax\nInvoice which includes the following:<\/p>\n\n\n\n<ul><li>The word \u201cCredit Note\u201d indicated prominently<\/li><li>Name, Address and GSTIN of the Supplier<\/li><li>Nature of the document<\/li><li>A consecutive serial number not exceeding 16\ncharacters, containing alphabets or numbers or special characters, unique for a\nFY<\/li><li>Date of issue of the document<\/li><li>Name, address and GSTIN or UIN of the\nrecipient (if registered)<\/li><li>Name and address of the recipient, along with\nthe address of delivery (if unregistered)<\/li><li>Serial no. and date of the corresponding Tax\nInvoice<\/li><li>Value of Taxable supply of goods or services,\nrate of tax and the amount of tax credited\/debited to the recipient<\/li><li>Signature\/ Digital signature of the supplier\nor hiss authorized representative<\/li><\/ul>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>DETAILS OF CR. NOTE TO BE FURNISHED IN RETURN: SECTION 34(2)<\/strong><\/p>\n\n\n\n<p>Any registered person who issues a credit\nnote shall declare the details of such credit note&nbsp;in the return for the\nmonth during which such credit note has been issued but not later than<\/p>\n\n\n\n<ul><li>September following the end of the financial\nyear in which such supply was made; or<\/li><li>the date of furnishing of Annual return,<\/li><\/ul>\n\n\n\n<p>whichever is earlier, and the tax liability\nshall be adjusted in prescribed manner.<\/p>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>OTHER PROVISIONS<\/strong><\/p>\n\n\n\n<ul><li>Credit note cannot be issued with GST on account of renegotiation of prices after supply if prices are reduced. In this case credit note can be issued without showing GST.<\/li><li>This credit note will not be required to be filed with monthly return.<\/li><li>Credit note for bad debts cannot be issued with GST.<\/li><li>Credit note cannot be issued with GST in respect of B2C supply as the tax invoice does not      have the GSTIN of the buyer.<\/li><\/ul>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>CREDIT NOTE INCLUDES THE SUPPLEMENTARY INVOICE.<\/strong><\/p>\n\n\n\n<p>If credit note is issued it\nshould be furnished in GSTR 1 for the month in which it is to be issued. The\ndetails will be auto populated in GSTR 2A of the recipient after which it is to\nbe accepted by him or her and submit it in his or her GSTR 2.<\/p>\n\n\n\n<p>A supplier will only be allowed\nto reduce the tax liability if the recipient accepts the credit note details in\nhis GSTR 2.<\/p>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>ISSUE OF CR. NOTE IN CASE OF TIME EXPIRED GOODS<\/strong><\/p>\n\n\n\n<p>If the time expired goods are\nreturned to the manufacturer or supplier, he or she can issue the credit note. <\/p>\n\n\n\n<p>If such returned goods are\ndestroyed by the manufacturer, he or she has to reverse the ITC attributable to\nthe manufacture of such goods under section 17 (5)(h) of IGST Act.<\/p>\n\n\n\n<p class=\"has-green-background-color has-background\"><strong>REDUCTION IN TAX LIABILITY RELATED TO UNJUST ENRICHMENT<\/strong><\/p>\n\n\n\n<p>If cr. note is not accepted by the recipient and if he or she does not reverse the equivalent input tax credit, the supplier will not be allowed to the reduction of tax liability.<\/p>\n\n\n\n<p><strong>JOIN THE CHANNEL ON TELEGRAM<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/t.me\/commerceiets\" target=\"_blank\">https:\/\/t.me\/commerceiets<\/a><\/p>\n\n\n\n<p><strong>CONNECT ON LINKEDIN<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/www.linkedin.com\/in\/kajal-mahajan-7549b2197\/\" target=\"_blank\" rel=\"noopener\">https:\/\/www.linkedin.com\/in\/kajal-mahajan-7549b2197\/<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>MEANING Credit Note is a document that is issued by a registered person under section 34(1) of CGST Act 2017 when supplies are returned or found deficient, or decrease in taxable value or GST charged in invoice. The tax liability of the supplier will reduce, as and when the Cr. Note is issued by the&#8230;<\/p>\n<p class=\"more-link-wrap\"><a href=\"https:\/\/commerceiets.com\/credit-note\/\" class=\"more-link\">Read More<span class=\"screen-reader-text\"> &ldquo;CREDIT NOTE&rdquo;<\/span> &raquo;<\/a><\/p>\n","protected":false},"author":2,"featured_media":4138,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[229],"tags":[],"_links":{"self":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts\/4136"}],"collection":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/comments?post=4136"}],"version-history":[{"count":0,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/posts\/4136\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/media\/4138"}],"wp:attachment":[{"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/media?parent=4136"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/categories?post=4136"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/commerceiets.com\/wp-json\/wp\/v2\/tags?post=4136"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}