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Section 34 of CGST Act, 2017 requires the recipient to reverse the Input tax credit already taken basis the credit note issued by the supplier so that the supplier can reduce his output tax liability. CBIC has issued Circular no. 212/06/2024 dated 26.06.2024 providing mechanism for evidencing the compliance of condition of section 15(3)(b)(ii) of CGST Act, 2017.
The GST Council has given relief to businesses, particularly fast-moving consumer goods companies, by removing the rule that required credit notes to be linked with invoices.
A supplier of goods or services can issue a credit note to the buyer in several instances. Typically this happens if the supplier has made mistakes in the original invoice, such as declaring a value higher than the value of goods or services actually provided or has mentioned an incorrect higher GST rate. A credit note is also issued when goods are returned by the buyer.
Any amendment in GSTR-1 or 3B the same to be done in October month GST Compliance for invoicing pertaining to F.Y.23-24
There is an ambiguity in the trade and industry that GST Credit note can be issued only with respect to Tax Invoices which are issued to B2B supplies and not to B2C Supplies, on the contention that such unregistered dealer will not be in a position to reduce the input tax covered by GST Credit notes, if so issued, hence not acceptable. This Article deals with the legal provisions relating to issue of GST Credit notes under GST Law, based on the provisions of GST Law as existing today, whether such GST Credit notes can be issued with respect to B2C transactions.
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