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Practise of issuing debit & credit notes

Phalgun (Audit Manager) (327 Points)

18 June 2012

Dear all,

Section 30 of KVAT dealing with issue of debit & credit note has been omitted . It states that the obligation on a trader to show the same in returns is not required. This is only for returns purpose. But as a practise , in the event of any returns , can the company follow the practise of issue of debit & credit note ? or else a fresh invoice be issued ?

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shivam gupta (Student) (142 Points)
Replied 18 June 2012

I don't know what is mentioned under KVAT act but i have done Audit of HP & as per HPVAT act in case of any return of goods as u already know that the output tax will proportionately reduced & the reduction can only be done if the return of goods has been made within 6 months of selling that goods

In case goods returned after 6 months from the date of sale then the seller have to pay output tax on whole sale made without any deduction of sales return & now is your answer that seller should issue a credit note & purchase will issue debit note consequently & yes it is in usual practice.