12 January 2021
1) WE SUPPLY TO SEZ UNIT DAHEJ WITHOUT PAYMENT OF IGST OF RS. 67000 MATERIAL. 2) HENCE ITS REJECTED & RETURN WITH BASIC AMOUNT OF RS. 67000 & WE PAID IGST DUTY OF 12060. HOW CAN ENTRY PASS FOR ABOVE TRANSACTION. WHILE PARTY GIVEN US VENDER RETURN NOTE OF RS. 79060
06 July 2024
Based on the transaction details you provided, here's how you can record the entries in your books:
1. **When Supplying to SEZ Unit (Without IGST Payment):** - When you initially supply goods to an SEZ unit without paying IGST, it's treated as a zero-rated supply under GST.
Assuming the original entry for supply: - Debit: Accounts Receivable (or SEZ Customer Account) - Rs. 67,000 - Credit: Sales Revenue - Rs. 67,000 (assuming there's no GST applicable here due to SEZ supplies being zero-rated)
2. **When Goods are Returned:** - When the goods supplied to the SEZ unit are returned, you need to account for the return and the associated IGST payment.
3. **Payment of IGST:** - Since the goods are returned from the SEZ unit, IGST becomes payable on the return of goods from SEZ to Domestic Tariff Area (DTA).
Entry for IGST payment: - Debit: IGST Payable - Rs. 12,060 - Credit: Bank Account or Cash Account - Rs. 12,060
4. **Vendor Return Note:** - If you receive a vendor return note indicating a credit of Rs. 79,060, this represents the amount to be adjusted or refunded by your vendor.
Entry for vendor return note (assuming it's a credit memo or adjustment): - Debit: Accounts Payable (Vendor Account) - Rs. 79,060 - Credit: Purchase Returns or Vendor Return Note - Rs. 79,060
**Summary of Entries:** - Initial supply to SEZ without IGST payment: - Debit Accounts Receivable (or SEZ Customer Account) - Rs. 67,000 - Credit Sales Revenue - Rs. 67,000
- Return of goods from SEZ: - Debit Sales Returns or SEZ Customer Account - Rs. 67,000 - Credit Accounts Receivable (or SEZ Customer Account) - Rs. 67,000
- Payment of IGST on returned goods: - Debit IGST Payable - Rs. 12,060 - Credit Bank Account or Cash Account - Rs. 12,060
These entries ensure that your books reflect the correct treatment of goods supplied to an SEZ unit, their return, and the associated IGST payment. Adjustments with the vendor return note are also accounted for accordingly. Always ensure to verify specific GST rules and implications applicable to SEZ supplies and returns as per current GST regulations.
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