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Purchase return in gst regime


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Querist : Anonymous

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Querist : Anonymous (Querist)
20 September 2017 Dear Experts,
We want to return the goods to supplier i.e. Purchase return. Pls tell me how can we send goods in return which document will be use for the same & who will issue whether buyer or supplies?

Thanks in Advance
Rajesh

20 September 2017 You ll be create Debit Note. Also you can send goods based on Debit note... The supplier received the goods then they ll be give Credit Note....

20 September 2017 You can proceed with way as suggested by Mr. RAJA P M. Reason being in GST law debit and credit are from suppliers prospective not from customer prospective. Further, to return these goods you should raise a delivery Challan mentioning details of goods and applicable gst on them. Further more, you should ask your vendor for a credit note for the goods so returned. Alternatively, you can also raise a tax invoice for the goods to be returned on your vendor these procedure will decrease the compliance work.




20 September 2017 In first line * you cannot

20 September 2017 My Dear Ashish Garg., In case returnable goods send by debit note it ll be decrease inward supplies. But, If it's send to A tax invoice then the sales / Turn over values are increased for the returned goods but it not sales. So, How to you refer Invoice based material return...? Pls correct me if I am wrong....!

20 September 2017 Dear sir, First I will correct you there is no any worth of customer debit note in GST. It's supplier credit note which will decrease itc of customer and his own output tax liability. Further, if the customer will raise a tax invoice than his output tax liability shall arise and the supplier will get the credit of tax so paid by his customer. Hence, tax effect remain the same in case he recive a credit note from his customer or raise a tax invoice. But the second way is much better reason being it has removed the compliance work of raising delivery challan for transportation of goods. Hope I am clear in my words.

20 September 2017 In my view....
It's not correct...
If create tax invoice then GP is raised without sales transaction.

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Querist : Anonymous

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Querist : Anonymous (Querist)
20 September 2017 Dear Raja sir,
Issuance of tax invoice with the same amount won't impact the GP




20 September 2017 No dear....
Its reflect in GP...
You can check once...

20 September 2017 In case before Debit Note / Invoice
Your purchase Value is 100000 and Sale Value is 100000
If you are give Invoice Rs 1000 (apprx). Your sale value is 101000. But its not sale. Just return.. GP is raised.
If you are give Debit note Your purchase value is Less 99000... Your GP is same purchase value is less...

So, Tax Invoice used only sales/Service Transactions. Can't use it Purchase returns...
If tax tax invoice is better as Debit/Credit note then the HEAD no need anywhere...!!!

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Querist : Anonymous

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Querist : Anonymous (Querist)
20 September 2017 OK?
Let me take me take an example,
Assume we have purchase the goods of 100 now we want return the goods of 50
Case 1) if we return the goods by credit note than purchase value become reduce Hence in this case if we look GP
Purchase 100. Sale 00
Less 50
Net purchase 50. Closing stock 50
Hence GP 00

Case 2)
Assume we have issued the tax invoice of 50 than Trading a/c will be
Purchase 100. Sale 50
Closing stock 50
Hence GP will remain the same 00

Pls correct me if I'm wrong

20 September 2017 But, Sales account increased...
Without sales....




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Querist : Anonymous

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Querist : Anonymous (Querist)
20 September 2017 Yes?
In this case sale will unnecessarily increased that may effect the Tax audit also Therefore even I'm not in views of issuance of tax invoice however as per the Act. Debit & credit Note will be issued by only supplier not by buyer Hence buyer cannot even issue the debit Note, so in this scenario in course of purchase return what document I will send for transportation of goods

20 September 2017 Dear you can send the goods on delivery challan further raising a tax invoice is a business call if the quantum and frequency is low than

20 September 2017 You can opt for that meaning thereby its a secondary option decision is yours




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Querist : Anonymous

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Querist : Anonymous (Querist)
21 September 2017 Dear sir,
Pls let me know whether movement of goods transportation thereof by delivery challan is allowable however Many Advocate as well as well CA are not in fovour of sending goods by delivery challan :- let me interpreted the definition of delivery challan
As per rule 55(1) of CGST act. 2017 delivery challan may be issued in following instance.
(A) supply of liquid gas where the quantity at the time of removal from the place of business of the supplier is not known.

(B) transportation of goods for job work.

(C) transportation of goods for reason other than by way of supply' or

(D) such other supplies as may be notified by the board,

So My doubt is on point No. C transportation of goods for reason other than by way of supply. Whether purchase return may be categorized in this clause considering that good are being transport for return Hence it is other than by way by supply,

Also as per rule 55(4) of CGST act. 2017 relaxation is given for issuance of tax invoice following is the extract :- where the goods being transport are for the purpose of supply to the recipient but the tax invoice could not be issued at the time of removal of goods for the purpose of supply the supplier shall issue a tax invoice after delivery of goods,

Therefore in my view transportation of goods by delivery challan is legally allowed. But my question was pertain to purchase return whether goods return will also cover in the definition of supply or other than supply.

Both of you are requested to pls guide me accordingly as per the provisions of act.

15 August 2018 Dear Sir,

in my opinion For purchase return debit note should be issued instead of sales invoice, because the seller should have to make credit note for sales return as per law. so either credit note debit note procedure to adopt or purchase or sale procedure to adopt, if we adopt purchase /sale procedure for the goods return, the law for issuing credit note would get ignored. So, as per the general accounting principals and as per credit note rules, debit note should be issued for purchase return.
Correct if i am wrong.



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