Issuing debit credit note under GST for sales made before gst registration or for sales form old entity (in case of business transfer)

ITC / Input 832 views 2 replies

narendra

Accountant

281 Points Posted on 02 June 2018

Hi Friends,

Can someone confirm below response I recceived from CBEC Mitra Helpdesk?

I called CBEC Mitra Helpdesk on 18001200232 a few minutes back, and I was informed as follows:

1. For Credit Notes issued after getting registered under GST, we are required to levy GST on all Credit Notes & Debit notes, even if original sales/supplies (related to such credit note being issued) was made BEFORE GST registration, as an unregistered dealer, without applying GST. Also, such credit notes will be reported under GSTR-1 and they should NOT be marked as "Pre-GST" if original sales/supplies were made on / after 1st July 2017 (in short, "Pre-GST" does NOT mean pre-registration).

2. Also, if there is transfer of business from one entity to another entity, then, for sales/supplies made in old entity, you can issue debit/credit notes (after the business transfer date) from the new entity. And such debit / credit notes should be reported under GST returns of the new entity.

Thanks,

Narendra

Replies (2)

CA Shivam Arora

Chartered Accountant

2414 Points Posted on 02 June 2018

The information given is absolutely correct.

narendra

Accountant

281 Points Posted on 05 June 2018

Sir, thank you for the response.

With reference to ponit no. 1 of my original post, what section of GST Act and/or what GST Notification number do I refer to, which confirms the same?

There seems some confusion (amongst CA's and some software vendors, including Tally Solutions), on the treatement of such debit/credit notes and how to show them under GSTR-1. In fact, the GST support team at Tally Solutions informed us that, we should NOT apply GST on such debit/credit notes (i.e. showing them as "exempt" supplies/returns).

Thanks,

Narendra