Legal Framework for Post-Supply Adjustments under the GST Regime
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Amit Varaiya
Dec 2, 2025, 6:40:49 AM12/2/25
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Legal Framework for
Post-Supply Adjustments
under the GST Regime
Post-Supply Adjustments
under the GST Regime
PDF ATTACHED
This article discusses the complications of post-supply
adjustments under the GST regime in India. The focus is on
post-sale discounts, the issuance of credit notes and the
reversals of corresponding input tax credits. It highlights
the legal requirements under Sections 15(3)(b) and 34 of
the CGST Act, emphasizing that the taxable value would be
reduced only if terms are pre-agreed at the time of sale and
the incidence of tax has not been passed to another person,
and further, the corresponding ITC has been reversed by
the recipient. In this article, we also distinguish commercial and non-commercial credit
notes. Recent amendments in Budget 2025 and CBIC Circular No. 212/6/2024 mandate
documentary proof of ITC reversal.
adjustments under the GST regime in India. The focus is on
post-sale discounts, the issuance of credit notes and the
reversals of corresponding input tax credits. It highlights
the legal requirements under Sections 15(3)(b) and 34 of
the CGST Act, emphasizing that the taxable value would be
reduced only if terms are pre-agreed at the time of sale and
the incidence of tax has not been passed to another person,
and further, the corresponding ITC has been reversed by
the recipient. In this article, we also distinguish commercial and non-commercial credit
notes. Recent amendments in Budget 2025 and CBIC Circular No. 212/6/2024 mandate
documentary proof of ITC reversal.
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