Debit note raised by customer due to material defects.


(Querist)
10 June 2019
Hi!

I need a clarification.
Our customer have raised debit note for Material rework done by them due some manufacturing defect . For that, they incurred labour charges of some amount. (For ex: Labour charges : 20000/-) They submitted debit note inclusive GST.

How to treat is debit note from my side.

I have to raise Credit note or I have to show in Manufacturing expenses.

Kindly clarify me.


CA R SEETHARAMAN (Expert)


Click to Talk 11 June 2019
Raise credit note...........................

SATHYA M (Querist)
12 June 2019
Thanks for your Valuable Reply. Credit note raised, but here they have debited Manufacturing Expenses instead of Sales. Is it correct.
Moreover, it is not showing in GSTR1 Report

CA R SEETHARAMAN (Expert)


Click to Talk 12 June 2019
Being rectification charges it can be debited to manufacturing expenses.

SATHYA M (Querist)
12 June 2019
Could you explain it Sir.
It is debited in Manufacturing Expenses, but it is not reflecting in GST Report?

CA R SEETHARAMAN (Expert)


Click to Talk 12 June 2019
Being debit note issued adjust in sales not to manufacturing account.

SATHYA M (Querist)
12 June 2019
Thanks for your Valuable reply sir


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