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Gst advance payment

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This query is : Resolved

Ram Gupta (Querist)

25 May 2023 i have received 1lakh for 10 months, i.e. 10lakh as advance for goods, but due to some reason i don't want to deliver goods and refund the payment received, i have paid GST on 10lakh (advance amount),so how can i receive that gst back, so that i can utilize it in some other sales.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

26 May 2023 As per section 31(3)(e) of CGST Act 2017 when such advance amount is refunded since no supply is made and no tax invoice is issued in pursuance thereof then registered person is required to issue refund voucher to the person who has made advance payment. It is pertinent to note here that there is no provision in GST law which debar a registered person from adjusting GST liability in respect of advance amount refunded through regular GST returns. In fact the statue indicates that GST amount paid on advance amount, which is refunded subsequently, can be adjusted through regular GST returns. In this regard reliance is placed upon the table number 9 of GSTR-1 form.

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