{"id":14448,"date":"2019-03-07T19:10:57","date_gmt":"2019-03-07T13:40:57","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=14448"},"modified":"2021-03-24T16:29:26","modified_gmt":"2021-03-24T10:59:26","slug":"amendment-under-gst-debit-note-credit-note","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/amendment-under-gst-debit-note-credit-note\/","title":{"rendered":"Recent Amendment under GST in Debit Note and Credit Note"},"content":{"rendered":"<p>A supplier or receiver of goods and services issue a Debit note or a credit note, when there is a revision in the invoice because of the change in the value of goods and services supplied or received. Let&rsquo;s start this blog by understanding the requirement of issuance a debit note or a credit note and then we will slowly move on to the recent <a class=\"glossaryLink\"  aria-describedby=\"tt\"  data-cmtooltip=\"&lt;div class=glossaryItemTitle&gt;Amendment&lt;\/div&gt;&lt;div class=glossaryItemBody&gt;An &amp;quot;amendment&amp;quot; refers to the formal change or correction of a legal document, often involving additions, variations, or deletions to address irregularities or clarify points in an agreement.(...)&lt;\/div&gt;\"  href=\"https:\/\/enterslice.com\/learning\/terms\/amendment\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'>amendment<\/a> under <strong>GST<\/strong> in Debit Note and Credit Note. This article describes the Recent Amendment under GST in Debit Note and Credit Note.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Key Highlights of Amendment under GST in Debit Note and Credit Note<\/h2>\n\n\n\n<p><strong><a href=\"https:\/\/enterslice.com\/learning\/gst-council-meet-summary\/\">GST council<\/a><\/strong> of India has released a notification no. 02\/2019- Central Tax dated 29<sup>th<\/sup> January in which the amendment of Central Goods and Service Tax Act, 2018 are mentioned. Following are the areas of the amendments under GST-<\/p>\n\n\n\n<ul><li>Debit Note and Credit Note under section 34 (1) and section 34 (3) of the CGST.<\/li><li>The insertion of the Sub-Rule (1A) into rules 5 of the CGST rules.<\/li><\/ul>\n\n\n\n<p>First we\nwill try to understand the basics of the Debit Note and Credit Note under the\nGST.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is the Debit Note and Credit Note in GST?<\/h2>\n\n\n\n<p>Below is the\nbasic understanding of Debit Note and Credit Note.<\/p>\n\n\n\n<ul><li><strong>If there is a decrease in the amount payable\nby buyer to seller-<\/strong><\/li><\/ul>\n\n\n\n<p>After\nsupplying the goods and services, there may be a change in the invoice\ngenerated by the seller. This may happen due to the return of goods or goods\nbeing of bad quality etc. This leads to the decrease in the prices of goods for\nwhich the purchaser issues a debit note. The amount of money debited from the\nsellers account and its reason for debit must be mentioned in the debit note. <\/p>\n\n\n\n<p>The seller will have a credit balance in the purchasers&rsquo; books of account. When a purchaser issues a debit note, the balance of the sellers account decreases, hence there will be a decrement in the sellers&rsquo; balance. This means that <g class=\"gr_ gr_8 gr-alert gr_gramm gr_inline_cards gr_run_anim Grammar only-ins doubleReplace replaceWithoutSep\" id=\"8\" data-gr-id=\"8\">buyer<\/g> has to pay the lesser amount to the seller to settle the liability. Henceforth, reduces the buyers&rsquo;&rsquo; liability. In a response to buyer or an acknowledgment to <g class=\"gr_ gr_9 gr-alert gr_gramm gr_inline_cards gr_run_anim Punctuation only-ins replaceWithoutSep\" id=\"9\" data-gr-id=\"9\">this<\/g> a credit note is issued by the seller.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" loading=\"lazy\" width=\"346\" height=\"365\" src=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/debit-note.png\" alt=\"debit note and credit note\" class=\"wp-image-14450\" srcset=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/debit-note.png 346w, https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/debit-note-284x300.png 284w\" sizes=\"(max-width: 346px) 100vw, 346px\"\/><\/figure><\/div>\n\n\n\n<ul><li><strong>If there is an increment in the amount\npayable by buyer to seller-<\/strong><\/li><\/ul>\n\n\n\n<p>A seller issues a debit note to the buyer, when the value of the invoice increases because of the additional goods sent or the goods already sent were charged at incorrect rates. A credit note is issued by the buyer to the seller, in a response or acknowledgement to the receipt of debit note. The buyer will have a debit balance in the sellers&rsquo; book of account. Issuing of a debit note increases the balance of buyers&rsquo; account. Hence increasing the buyers&rsquo; liability and the buyer needs to pay more amounts to the seller to settle the liability. <\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" loading=\"lazy\" width=\"307\" height=\"374\" src=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/credit-note.png\" alt=\"debit note and credit note\" class=\"wp-image-14451\" srcset=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/credit-note.png 307w, https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/credit-note-246x300.png 246w\" sizes=\"(max-width: 307px) 100vw, 307px\"\/><\/figure><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Debit and Credit note under the GST Amendment<\/h2>\n\n\n\n<p>First we will try to understand the issuance of debit note and credit note\nunder the CGST Act, 2017. Then we will explain the amendments released by the\nGST council in detail, which have been effective from 1<sup>st<\/sup> of\nFebruary, 2019-<\/p>\n\n\n\n<p><strong>When a supplier issues a\nDebit Note?<\/strong><\/p>\n\n\n\n<ul><li>If the taxable amount mentioned in the original invoice is lesser than the\nactual taxable amount. <\/li><li>If the amount of tax charged in the invoice is lesser than the actual tax\npaid<\/li><\/ul>\n\n\n\n<p>Hence, in such cases the debit note will include a suppplementary invoice.<\/p>\n\n\n\n<p><strong>When a supplier issues a\nCredit Note?<\/strong><\/p>\n\n\n\n<ul><li>If the taxable value in the original invoice isssued is more than the\nactual taxable value.<\/li><li>If the tax charged in the original tax invoice is more than the actual tax\npaid<\/li><li>If there is a deficiency in the services provided<\/li><li>If the goods are returned to the supplier<\/li><\/ul>\n\n\n\n<p>Hence a supplementary invoice will be included in the Credit Note.<\/p>\n\n\n\n<p>Section 34 of the CGST Act, 2017 provides the provision in relation to the\ndebit note or credit note under GST. As per the notification featured on 29<sup>th<\/sup>\njanuary, 2019, Government of India has amended the provisions under section 34\nof the CGST Act, which has been effective from 1<sup>st<\/sup> february, 2019.<\/p>\n\n\n\n<p>We will try to understand the provisions with the help of the comparison\nbetween the earlier provisions and the amended provisions. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Provisions under Section 34 of the CGST Act<\/h2>\n\n\n\n<p>Below is the comparison between the earlier and amended provisions-<\/p>\n\n\n\n<ul><li><strong>Earlier Credit Note\nprovision under the section 34 (1) of th CGST Act, 2017<\/strong><\/li><\/ul>\n\n\n\n<p>As the per the sections 34(1) of the CGST  Act, Where <strong><em>tax invoice<\/em><\/strong><sup><a href=\"http:\/\/www.cbic.gov.in\/resources\/\/htdocs-cbec\/gst\/tax-invoice-efliers.pdf;jsessionid=2CC9030CF2DB44B4854FCC7747CC6679\"><strong>[1]<\/strong><\/a><\/sup> has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a <strong><em>credit note<\/em><\/strong> containing such particulars as may be prescribed.<\/p>\n\n\n\n<ul><li><strong>Credit Note Provision after\namendment<\/strong><\/li><\/ul>\n\n\n\n<p>Where <strong><em>one or more tax invoice<\/em><\/strong> has been issued for supply of any goods\nor services or both and the taxable value or tax charged in that tax invoice is\nfound to exceed the taxable value or tax payable in respect of such supply, or\nwhere the goods supplied are returned by the recipient, or where goods or\nservices or both supplied are found to be deficient, the registered person, who\nhas supplied such goods or services or both, may issue to the recipient a one\nor more <strong><em>credit nots for the supplies made in a financial year<\/em><\/strong>\ncontaining such particulars as may be prescribed.<\/p>\n\n\n\n<ul><li><strong>Earlier Debit Note provision\nunder the section 34 (3) of th CGST Act, 2017<\/strong><\/li><\/ul>\n\n\n\n<p>As the per the sections 34(3) of the CGST \nAct, where a <strong><em>tax invoice<\/em><\/strong> has been issued for supply of any goods or services\nor both and the taxable value or tax charged in that tax invoice is found to be\nless than the taxable value or tax payable in respect of such supply, the\nregistered person, who has supplied such goods or services or both, shall issue\nto the recipient a <strong><em>debit note<\/em><\/strong> containing such particulars as may be prescribed.<\/p>\n\n\n\n<ul><li><strong>Debit Note provisions after\namendment<\/strong><\/li><\/ul>\n\n\n\n<p>As the per the sections 34(3) of the CGST \nAct, where <strong><em>one or more tax invoice<\/em><\/strong> has been issued for supply of any goods\nor services or both and the taxable value or tax charged in that tax invoice is\nfound to be less than the taxable value or tax payable in respect of such\nsupply, the registered person, who has supplied such goods or services or both,\nshall issue to the recipient <strong><em>one or more debit note for the supplies made\nin a financial year<\/em><\/strong> containing such particulars as may be prescribed.<\/p>\n\n\n\n<p>Now we will further update you regarding the insertion of new sub-rule\n(1A) into the rule 53 of the CGST Rules, 2017.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Insertion of new sub-rule (1A) into rule 53 of\nthe CGST Rules, 2017<\/strong><\/h2>\n\n\n\n<p>Government has inserted a new sub-rule (1A) into rule 53 of the CGST\nRules, 2017. Below are the following particulars that must be mentioned ina\ndebit or credit note-<\/p>\n\n\n\n<ul><li>Name, address, and GSTIN of the supplier<\/li><li>Nature of the document <\/li><li>A consecutive serial number<\/li><li>date of issue of the document<\/li><li>Name, address and GSTIN \/ UIN, in case the recipient is registered<\/li><li>Name and address of recipient and the address of the delivery, along with\nthe name of the state and its code, in case the recipient is unregistered<\/li><li>The serial number and the date of the corresponding tax invoice (tax invoices)\nor bill of supply<\/li><li>Value of the taxable supply of goods \/ services, the rate of the tax and\namount of the tax credited or debited to the recipient<\/li><li>The signature \/ digital signature of the supplier \/ authorized\nrepresentative<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Conclusion<\/strong><\/h2>\n\n\n\n<p>Hope you have a clear picture of the recently introduced amendment under GST in the Debit and Credit note in India. In India, Goods and Services Tax (GST) is seen as one of the most influential transformations in the field of taxes. If we look at the earlier process relating to Debit and Credit Note, India was not following the ideal policy. After various such amendments, the chances of fraud and error seem to have decreased.<\/p>\n\n\n\n<p>Moreover, It is always advisable to obtain the <a href=\"https:\/\/enterslice.com\/gst-registration\" target=\"_blank\" rel=\"noopener noreferrer\"><strong>GST registration<\/strong><\/a> certificate before you start a business. For any other queries related to the above amendment, contact <strong><a href=\"https:\/\/enterslice.com\/\">Enterslice<\/a><\/strong> now.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/enterslice.com\/learning\/updates-on-gst-portal\/\">Recent Updates of New Functionalities on GST Portal<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A supplier or receiver of goods and services issue a Debit note or a credit note, when there is a revision in the invoice because of the change in the value of goods and services supplied or received. Let&rsquo;s start this blog by understanding the requirement of issuance a debit note or a credit note [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":14452,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[49,2562],"tags":[13,93],"acf":{"service_id":"96"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.6.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Amendment under GST in Debit Note and Credit Note - Enterslice<\/title>\n<meta name=\"description\" content=\"Amendment under GST in section 34 (1) and section 34 (3) of the CGST Act and insertion of new sub-rule (1A) will remove the ambiguity among the dealers.\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/amendment-under-gst-debit-note-credit-note\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Amendment under GST in Debit Note and Credit Note - Enterslice\" \/>\n<meta property=\"og:description\" content=\"Amendment under GST in section 34 (1) and section 34 (3) of the CGST Act and insertion of new sub-rule (1A) will remove the ambiguity among the dealers.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/amendment-under-gst-debit-note-credit-note\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:author\" content=\"enterslice\" \/>\n<meta property=\"article:published_time\" content=\"2019-03-07T13:40:57+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-03-24T10:59:26+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/debit-note-credit-note.jpeg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"853\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","authorName":"Narendra Kumar","authorImageUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/04\/nk-1.jpg","authorDescription":"Experienced Finance and Legal Professional with 12+ Years of Experience in Legal, Finance, Fintech, Blockchain, and Revenue Management.","postViews":591,"readingTime":5,"nextPost":{"id":14511,"slug":"e-way-bill-system-under-gst"},"prevPost":{"id":14436,"slug":"nbfc-new-governance-code"},"featuredMediaUrl":"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2019\/03\/debit-note-credit-note.jpeg","postTerms":"GST","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/14448"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=14448"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/posts\/14448\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/14452"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=14448"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/categories?post=14448"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/tags?post=14448"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}