kumar (accounts officer) (26 Points)
21 December 2015HI,
MY QUESTION IS THAT, WE HAVE SUPPLIED MATERIAL TO PARTY, WITH APPLING EXCISE DUTY AND VAT, BUT THAT MATERIAL WAS REJECTED SO CUSTOMER SEND BACK SAME MATERIAL WITH JUST EXCISE DUTY, SO HOW WE CAN GET THAT VAT AMOUNT RETURN OR ANY DECLARATION(VAT CREDIT NOT TAKEN BY CUSTOMER) FORMAT IS THERE WHICH I CAN GET FROM CUSTOMER
CA Komal Puri
(Practicing Chartered Accountant)
(163 Points)
Replied 21 December 2015
You need to get a credit note from your party who has returned the goods mentioning the amount of excise and VAT. Also preserve the LR, Delivery Challan and any other proof that the goods have been returned.
kumar
(accounts officer)
(26 Points)
Replied 21 December 2015
CUSTOMER SAYING THAT HE HAS NOT TAKEN VAT CREDIT, SO IF HE HAS NOT TAKEN CREDIT THEN HOW HE CAN GIVE US CREDIT NOTE
CA Komal Puri
(Practicing Chartered Accountant)
(163 Points)
Replied 21 December 2015
Credit note has to be given as a proof that the party has returned the goods. If the goods have been returned within six months you can avail the tax benefit by paying VAT amount less amount of rejection. While returning goods it is mandatory for the party to issue a rejection note as a proof that the goods are returned. He is anyways not entitled to claim set-off if he has returned the goods but the amount has to be seperatley mentione don the note so that the tax paid can be reversed. If it is not done then the ledger account will show the VAT amount as outstanding.
Entries to be Passed by you:
On Sales
Debtors Dr.
To Sales
To Excise
To VAT
On return
Sales Goods Returned Dr
Excise Goods Returned Dr
VAT Goods Returned Dr
To Debtors
Entries by the corresponding Party
On Purchase by them:
Purchase Dr
Excise Dr
VAT Dr
To Creditors
On return :
Creditors Dr
To Purchase Goods Returned
To Excise Goods Returned
To VAT Goods Returned
The above entries are essential to square off the transaction.
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