GOODS LOST

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This query is : Resolved

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If goods are lost or stolen during transit before supply is complete, you must amend your GSTR1 return to reverse the sale. This is necessary to comply with GST regulations. Even after reversing the sale, you will retain all original documentation, such as invoices and the GSTR1 filing, which can be used as proof when pursuing legal action against the transport company. The accounting entry for goods lost in transit involves debiting 'Loss of goods in transit' and crediting 'Stock'.

janak kumar singhal

janak kumar singhal (Querist)

11 June 2020 Sir
I want to state that I have sent goods form rajasthan to Bihar via trasport as on 15.02.2020.
I have filled my GSTR 1 Return for Feb month and show such sale.
Such goods have stolen in transport and due to it goods not reached to bihar.
Please guide me what we have to do.

Punit Gupta

Punit Gupta (Expert)

11 June 2020 Goods are damaged before the completion of Supply, so technically goods are in your hand only.
You shall amend the Feb GSTR1 in forthcoming R1 for coming periods and reverse the Sale.

janak kumar singhal

janak kumar singhal (Querist)

12 June 2020 Thanks sir,
I agree with you.
I want to lodge legal proceedings against transport then also we have to reverse the sale or not.
If in legal proceedings advocate ask goods sent bilti and other supporting documents then such R1 is also a proof of goods sent.
Please also guide me accounting entry for goods lost

Punit Gupta

Punit Gupta (Expert)

12 June 2020 You need to reverse the Sale in order to comply with the provisions of GST.
You will have both- the Original R1, and the Amended R1.
Even after reversing the sale, you will have all the invoices, bills, vouchers and other supporting documents with you, which will help you to proceed with the litigation.
Journal entry for Goods lost in Transit:
Debit: Loss of goods in transit
Credit: Stock

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