Replacenlment of Machine sold in FY 2018-19

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B.Com
60 Points Posted on 02 January 2021
Hi,

we sold one machine in 14.02.2019 to our customer & due machine defect we Replace machine in Jan-2021. without consideration.
ples explain the process for Replacement of old Machine.
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On 02 January 2021 at 11:17 Report
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Quick Summary
This discussion explores how to account for replacing a machine sold in FY 2018-19 due to defects, when the replacement occurs without any monetary consideration. Key questions revolve around treating this as a supply, reversing input tax credit (ITC), and how to close the transaction in the books. Advice suggests that if ITC was availed, GST may be payable as it's considered a supply, with valuation rules applying. If the replacement is within warranty, a delivery challan may suffice with no GST liability.

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STUDENT
1631 Points Posted on 02 January 2021
Treat as supply or reverse the credit availed !
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On 02 January 2021 at 12:53
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B.Com
60 Points Posted on 02 January 2021
If i cansiderd as supply,

our customer not giving any amount how close in our books, whether we acconted as a Baddebts at the time of closing of our books
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On 02 January 2021 at 13:18
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STUDENT
1631 Points Posted on 02 January 2021
Then , you reverse the input availed ..
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On 02 January 2021 at 13:33
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378 Points Posted on 02 January 2021
If you availed ITC in respect of that Machinery being CG then you are required to pay GST as it is supply as per Schedule 1 of act. Secondly the value shall be as per Rule 30 or Rule 31 if their is no consideration. But if you consider a consideration of any nominal amount then you can pay GST of the amount you claimed at the time of purchase of ITC reduce by 5 percentage per quarter of that Itc till date of disposal
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On 02 January 2021 at 14:22
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B.Com
60 Points Posted on 02 January 2021
Sir we are supply machine & now our customer send old machine due defect, same will replace now for without consideration.(transaction happens after warranty)

how to send machine to our customer
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On 02 January 2021 at 14:42
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378 Points Posted on 02 January 2021
In that case delivery challan is sufficient.....No gst liability as It is in warranty period
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On 02 January 2021 at 15:17

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