A real Estate Company received Advance from a Customer towards flats Rs. 2,00,000/- [includive of GST of rs. 15000/-] & Paid GST through ITC. After Sometime the Customer cancelled Flats and asked for Refund of Advance paid. The Company refunded full advance of Rs. 2,00,000/-. Now:
(1) Is the Company required to reverse GST Liability of Rs. 15,000/- [paid earlier through ITC] and adjust this towards another Liability?
(2) If The Company refunded only Rs. 1,50,000/- and Balance Rs. 50,000/- retained as Cancellation Charges Income, then Is GST liable to be paid on such Cancellation Charges provided Earlier GST Liability reversed?
(3) If the Company did not reverse Output GST, then GST on Cancellation charges not required because this Cancellation charges already forming part of Advance received on which GST of Rs. 15000/- already paid. Is it Correct?
Please suggest with relevant provisions.
CAclubindia
