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Can you escape GST liability simply by cancelling an invoice after a deal falls through? The Madras High Court's decision in Sudhan VFX v. Superintendent offers a crisp-if uncomfortable-answer: No. If you've raised an invoice and declared the corresponding outward supply in GSTR-1, the tax liability can arise even if you never receive payment. A unilateral, after-the-fact "invoice cancellation" is not a silver bullet...... Read More
When Discounts Arrive Late: A Practical Guide to Post-Sale Discounts & Credit Notes Under GST
Volume rebates, scheme discounts, year-end incentives, rate protection, price-drop support - in real life, most big-ticket business happens after the basic invoice is raised. Commercial teams liberally promise "extra 2% at year-end", but the tax team is then left asking: Can we reduce GST already paid on the original invoice? Does the dealer have to reverse ITC - and how do we prove it? Is this just a discount...... Read More
Credit Notes under GST v/s Commercial Credit Notes: The Ambiguity Among Taxpayers
The issuance of credit notes to the customer is a very common practice in every business. Under GST the provisions of credit notes are governed by section 34 of CGST Act 2017. Instead of issuance of credit notes under GST, sometimes the commercial credit notes or financial credit notes are also issued by the supplier. Accordingly, there is always ambiguity among the taxpayers regarding the difference between GST credit notes and financial /commercial credit notes...................... Read More