Skip to content

CA Final · Indirect Tax Laws · Tax Invoice, Credit and Debit Notes

Following a demand under section 74, Iyer Metals, Chennai, issues a debit note to a recipient for the tax payable. Under Rule 53 of the CGST Rules, which requirement applies to this debit note, and which particular is mandatory for all credit or debit notes under Rule 53(1A)?

The debit note must prominently carry the words "INPUT TAX CREDIT NOT ADMISSIBLE" because it is issued for tax payable under section 74. Every credit or debit note must also show the serial number and date of the corresponding tax invoice or bill of supply.

  1. AIt must carry the words "INPUT TAX CREDIT NOT ADMISSIBLE"; it must show the serial number and date of the corresponding tax invoiceCorrect
  2. BIt need carry no special words; the HSN code of goods is the only mandatory particular
  3. CIt must carry the words "Revised Invoice"; it need not show the corresponding invoice
  4. DIt must carry the words "INPUT TAX CREDIT NOT ADMISSIBLE"; the serial number may exceed sixteen characters

Explanation

Rule 53(3) requires any invoice or debit note issued for tax payable under section 74, 129 or 130 to prominently contain the words "INPUT TAX CREDIT NOT ADMISSIBLE". Rule 53(1A)(g) requires the serial number(s) and date(s) of the corresponding tax invoice(s) or bill(s) of supply. Serial number cannot exceed sixteen characters, so option D is wrong.

Did you get it right without looking?

One question tells you little. A timed set on Tax Invoice, Credit and Debit Notes shows your real accuracy, how long you take and where you lose marks.

Practise Tax Invoice, Credit and Debit NotesFree diagnostic mock

More Tax Invoice, Credit and Debit Notes questions