Skip to content

CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Procedural Compliance under GST

A registered supplier issued a tax invoice with taxable value Rs 2,00,000 but the correct taxable value was Rs 2,20,000. Which statement is correct under Section 34?

The supplier must issue a debit note because the invoice understated the taxable value. Under Section 34(4) the debit note is declared in the return for the month in which it is issued, and the November time limit applies only to credit notes.

  1. AThe supplier must issue a debit note, and must declare it in the return for the month in which it is issuedCorrect
  2. BThe supplier may issue a credit note for Rs 20,000 to the recipient
  3. CThe supplier must cancel the invoice and cannot issue any further document
  4. DThe supplier must issue a debit note, to be declared by 30 November following the financial year

Explanation

The invoice value is less than the correct value, so Section 34(3) requires a debit note. Under Section 34(4) it is declared in the return for the month of issue; no November cut-off applies to debit notes, which is why the last option is wrong. A credit note is for excess values.

Did you get it right without looking?

One question tells you little. A timed set on Procedural Compliance under GST shows your real accuracy, how long you take and where you lose marks.

Practise Procedural Compliance under GSTFree diagnostic mock

More Procedural Compliance under GST questions