GOODS RETURN

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Pardeep (Querist)
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01 December 2019 Can any body explain circular no. 72/46/2018 for returning of goods becouse of time expired of goods.
i am trader purchase medicine 100+18 and sold to next retailer 120+21.6 now sometime retails return me goods throw a credit note of rs 120+21.6 and i return goods to manufacture at 100+18 credit note.
II SITUATION : Retails return goods with no gst credit note of rs 120 so i return goods to manufacture ar rs 100.
what ITC I need to return in both the case.
HOW TO SHOW THESE TRANSACTION IN BOTH CASES IN GSTR-3B.

CA Anita Bhadra

CA Anita Bhadra (Expert)
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01 December 2019 First & foremost - In GST , credit note will be issued by the supplier & not the recipient. Your retailer or even you as a recipient to your manufacturer can not issue credit note .

Circular 76 gives two option -
Option 1 - Recipient can return goods and treat it as fresh supply .

In your case , you retailer will show as fresh supply 120+21.60 and you are eligible for ITC and you send to manufacturer as fresh supply 100+18 and manufacturer can claim ITC

Second option - your manufacturer will issue credit note on you and you will raise credit note on your retailer . You retailer will reverse ITC of 21.60 & you will reverse ITC of Rs 18

In my view , 1st option is better and simple to use

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Pardeep

Pardeep (Querist)
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02 December 2019 I am Confused with reversed word.
I case : credit note with itc i reduced sell pries & tax payable & itc by issuing credit note & reduced purchase value & itc by acceptance credit note. i need to reversed the credit other than that.
II Case : credit note without itc i paid tax on sale & received the itc on purchased and amount adjusted with party with credit note than even i need to reversed any credit.

CA Anita Bhadra

CA Anita Bhadra (Expert)
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02 December 2019 In option 1 - you need not to reversed any credit . It will be treated fresh supply .

In option 2 - I will try to explain with an example :-
First between yo and manufacturer .
Since you are recipient , when you purchased , you must have paid Rs 18 as GST and also availed ITC of Rs 18/- . When you return this to your manufacturer , he will raise credit note and you need to reverse 18 ( as availed by you earlier at the time of purchase )
Same way , your customer must have availed ITC of Rs 21.60 at the time of purchase and need to reverse when he will return and you will issue credit note to him

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Pardeep

Pardeep (Querist)
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02 December 2019 Means if i am returning goods without GST CREDIT note than we need to reversed I

Pardeep

Pardeep (Querist)
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02 December 2019 Means if i am returning goods without GST CREDIT note than we need to reversed Itc
Or Not.

CA Anita Bhadra

CA Anita Bhadra (Expert)
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03 December 2019 If you are returning good and raising invoice as fresh supply and not issuing credit note , need not to reverse credit note but pay GST as a normal supplier

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