Credit note and resale of goods for which credit note was issues

Eway Bill 121 views 3 replies

Hello All,

We are into textile manufacuring, and almost 100% of my sales is bill to ship to basis as the cloth from our factory goes to dyeing house from processing. We are in a situation wherein sometimes goods are returned/not accepted by the buyer but goods have reached dyeing house. 

So the situation is that i sold goods to party ABC and shipped it to dyeing house PQR, after quality test party ABC rejected our goods, now the goods are lying the dyeing house PQR, so I contact party XYZ and convince him to buy the goods, party XYZ agrees for the same and I issue an bill to ship to invoice without eway to the new party i.e party XYZ cause goods are in the dyeing house & there is no movement of goods, and i also issue credit note to party ABC.  

Now the officer is saying how can you take credit of gst cause ewaybill was not issued when i issued the credit note, buyer XYZ will also feel insecure as his purchase is without ewaybill number.

What to do in such a situation ? There is no moment of goods in this resale, hence ewaybill is not applicable. Also we issue e-invoice as our turnover is above 5cr.

Replies (3)

A complex scenario involving credit notes, resale, and e-way bills! Key Points

1. *Goods were sold to Party ABC*: Goods were shipped to a dyeing house (PQR) on a bill-to-ship-to basis.

 2. *Goods were rejected by Party ABC*: Party ABC rejected the goods, which remained at the dyeing house (PQR).

 3. *Goods were resold to Party XYZ*: You convinced Party XYZ to buy the goods, and a bill-to-ship-to invoice was issued without an e-way bill.

4. *Credit note issued to Party ABC*: A credit note was issued to Party ABC. Officer's Concern The officer is questioning how you can take GST credit without an e-way bill when issuing the credit note. Solution In this scenario:

1. *No e-way bill is required*: Since there is no movement of goods during the resale, an e-way bill is not applicable.

2. *Credit note is valid*: The credit note issued to Party ABC is valid, as it relates to the original sale.

3. *GST credit can be claimed*: You can claim GST credit on the original sale, as the credit note is valid.

 4. *Inform Party XYZ*: Inform Party XYZ that the resale is legitimate, and the goods were originally sold to Party ABC.

Recommendations

 1. *Maintain proper documentation*: Ensure all documentation, including the credit note, invoices, and communication with parties, is properly maintained.

2. *Explain the situation to the officer*: Provide a clear explanation of the situation to the officer, highlighting the lack of goods movement during the 

Thanks for your detailed answer, can i make ewaybill only with part-a filled (only for records) for the new sale invocei. Bill to XYZ Ship to dyeing house PQR bill from MY COMPANY NAME ship to dyeing house PQR

Thanks for your detailed answer, can i make ewaybill only with part-a filled (only for records)


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