Purchase return with different tax rate

Page no : 2

NAVEEN (Sr.ACCOUNTANT) (261 Points)
Replied 03 November 2019

Thank All If it is 18℅ How to adjust the difference

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RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 03 November 2019

Mr Subhagan Sreerangam., Better to Explain Yourself for the view without copy paste dear...

Pankaj Rawat (GST Practitioner) (55057 Points)
Replied 03 November 2019

Dear Raja Ji

How can you charge @ 28 GST on the Item with HSN code now @ 18%

In case of Rate change the Section 14 of Specifically prescribe that the rate prevailing will be charged.

What is Time Of Supply.
Time of supply fixes the point when the Liability to charge GST Arises.

Now lets explain with Example :
Mr. A have contract with Mr B to supply 100 Nos of Item GST Rate 18% on 1/10/2019 & Reced Advance 50% for the same from Mr.B , But in the mean time the rate has been changes ,for the said Item to @ 28% now Mr A is liable to charge 28% if he supply the ordered items to B after 1/10/2019 because Time of supply is after 1/10/2019 & rate for that item is now 28% , so he cannot charge 18% .

How can one charge GST Rate for the item which was applicable Earlier , the current prevailing rate will be applicable.

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RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 03 November 2019

Very Well Mr Pankaj Rawat Ji.,

Yes...
You are exactly correct for the supplies (as Sales) rate on or before 1st 18 percent & after 1st 28 percent...

But, In case before 1st saled material will be returned from Buyer then it's reversed @ 18% tax rate. Not @ 28%....

Please think about the sales return against the supplied invoice...

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Pankaj Rawat (GST Practitioner) (55057 Points)
Replied 03 November 2019

Dear Mr Raja Ji .

Thanks sir

But......

Now let's take one more example.

GST was Applicable on 1/7/2017 & any goods which was sold in Vat Regime is return In GST period , what is applicable GST Rate or Vat Rate ,... ofcourse it's GST rate is applicable.

I knew that For sale return The Invoice need to be Tag but it will accept it because it's checks for 1. Invoice No. 2. Date , 3.the credit not amount shall not be Greater then Invoice amount .

Now lets suppose The goods to be Return having HSN code XXXX & as of today the Rate is 18% . now we cannot charged 28% the earlier rate for HSN code XXXX

Can we bill the goods 28% which is purchase @ 28% earlier but now rate of the same is 18% ..... no we cannot , the Recepient will not Accept.

So even though it's sale return the tax rate will be charged as per current rate prevailing.

Mr. Subhagan
Try to reply by using your own wit & knowledge.

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NAVEEN (Sr.ACCOUNTANT) (261 Points)
Replied 03 November 2019

Dear All
Section 7 scop of supply is too wide to accommodate sales return also If yes time of supply rule is applicable to sales return also as it is applicable to sales (supply)
in that point what is the difference between sales and sales return both are supply only as per Gst rule

RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 03 November 2019

(using mobile app, that's not showing replies & alerts also new queries now)

Good Question Mr Pankaj Rawat Ji...

In VAT regime Sales/Purchase return time period just 180 from the date of Invoice.
The Govt (as per my knowledge in TN) give up-to December (also to March🤔🤔) for the filing of VAT returns... And the same time Tran form time is extended.
But, In GST you know the PY related time being...

Also in many more replies (as per your above said query) I said move with sale invoice... No need to issue Credit / Debit note bcoz, no way for return under VAT regime...

Pankaj Rawat (GST Practitioner) (55057 Points)
Replied 04 November 2019

Dear Mr. Raja Ji.

And if suppose the person has already filed Tran 1 , ?????
Actually I mean to say that when it's being Notified that rate of said goods being reduced & which is applicable & effective. Then I don't think the Tax payer can charge old rate ,even though if it is sale return .

Anyway ..... I respect your views .

Thanks & Regard 🙏

1 Like

RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 05 November 2019

Hi Pankaj Rawat Ji.,

No more problem if it's not suitable or understand. Keep Your view...

But,
Finally give your reply...

If Invoice no 01 & dt 01/10 issued to B with tax rate 28% by A. Buyer returned the goods after 1st October (after changed the tax rate) then how to reverse/against the invoice/credit note the sale return in books...

Note against the invoice and how to show the credit note in GSTR 1 return...

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Pankaj Rawat (GST Practitioner) (55057 Points)
Replied 05 November 2019

Suppose Invoice details as below (Issued)

AV 100
GST. 28
Total. 128

Now CNT is to be issue when rate Changed from 28% to 18%

1st method :
AV 100
GST 18
Total. 118
*Remaining balance of 10/- can write-off by Crediting "Rate Change Excess/Short" (As income )

2nd Method:

AV 108 (by reverse calculated)
GST. 20
Total. 128

So you can Apply any of above mentioned method to issue CNT

Note : In GSTR1 The CNT reported : The portal Check for Validation : 1. Invoice Number.
2. Invoice date
3. The gross value of CNT shall not be greater then Invoice issued

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RAJA P M ("Do the Right Thing...!!!") (128106 Points)
Replied 05 November 2019

Purchase Return / Sales Return or Credit Note / Debit Note is preparing against the already Sales / Purchase invoices only which is what is in the Invoice...
No need other charges/ledgers not applicable...