Composition scheme debit note

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Himanshu Rupela

Student CA IPC / IPCC

451 Points Joined August 2015

A Firm is in Composition scheme receives supply from a registered Dealer.

After 3 months the Purchaser found that stock may got Old within few weeks. Therefore, Purchaser wants to issue a debit note to Supplier.

The supplier comes in the story now

The supplier is asking for a Debit note quoting the Tax Amount separately, to take Output GST return.

Supplier is also asking for E way bill, even the bill amount is less than Rs 50,000/.

As per Sec 34 of CGST Act, the Supplier can issue Credit Note for the same.

Please provide answers to these questions.

1. Can Debit note be issued with Tax amount ? If Yes, Please attach the Sample Format.
2. How to prepare E-way Bill for same ?
3. Can Credit Note be issued by supplier, if Yes, Please mention the Sec & Rules for the same. Please attach the sample format.

Replies (4)

sabyasachi mahana

articled assistant

28 Points Joined December 2011

you can't issue debit note, credit note should be issued by the supplier

RAJA P M

"Do the Right Thing...!!!"

128121 Points Joined January 2015

Yes.... I agreed with Mr Sabyasachi.

Pankaj Rawat

GST Practitioner

55062 Points Joined June 2017

As per Section 34 of CGST Act , it's correct that supplier can Only issue credit note & Debit Note ..... but why ...... ?????
because of GST Return Format ... yes it's due to Return filing system which allow only to supplier to issue Debit Note & Credit Note. As debit/credit note are to be report in GSTr 1 (Annexure 1) which is to be done by 10th of every month & after that you won't be allow to upload your outward supply , hence all the outward supply & debit/credit issued by supplier will get autopopulated to Recepient & same can be accept/reject by Recepient. (Recepient is not allow to upload annexure 1)

Thus , it's supplier who can issue credit/note in GST but that doesn't mean that recepient is not allowed to issue the same , he can .... in his book of can issue credit/debit note.
Now lets if Recepient wants to send the material back to Supplier , how he can return the same ???? , In term of Rule 55 can return back material under cover of Delivery Challan & attach a copy of Debit Note & it's proof from that the E-way bill portal does not give option Recepient for Debit Note , so the eway bill shall be generated on Delivery challan & debit note can be attached with same .

Note : Here the debit note with delivery challan just to pass an entry in books of accounts , to reverse the ITC the Recepient need the credit from supplier