53rd GST Council's proposed mechanism on post-sale discounts
NEW DELHI: Stakeholders across sectors, including FMCG, infrastructure, electricals, electronics, furniture, and jewellery, are expected to benefit from the implementation of a clarification mechanism regarding post-sale discounts, proposed by the 53rd GST Council meeting, according to experts.
The GST Council has recommended a mechanism for suppliers to demonstrate compliance with Section 15(3)(b)(ii) of the CGST Act, 2017, related to post-sale discounts.
This move addresses the challenges faced by suppliers in ensuring that recipients reverse Input Tax Credit (ITC) on credit notes, as mandated by law. The proposed mechanism, expected to be facilitated through the GSTN, will enable suppliers to secure confirmation from recipients regarding the reversal of ITC on credit note amounts.
According to experts, field officers raised numerous demands on the issuers of the credit note, despite suppliers being unable to legally verify if recipients had indeed reversed the ITC.
