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

Mehta Pharma Distributors, a registered person, supplied goods in March 2024 (FY 2023-24) under a tax invoice. The buyer returned part of the goods, and Mehta issued a credit note on 5 June 2024. Considering section 34(2), what is the latest time limit for Mehta to declare this credit note in a return, assuming the relevant annual return for FY 2023-24 is furnished late in January 2025?

The limit is 30 November 2024. Section 34(2) allows declaration until the thirtieth day of November after the financial year of the supply or the date of the annual return, whichever is earlier, and here November 2024 falls before the late January 2025 annual return.

  1. A30 November 2024, being the thirtieth day of November following the end of the financial year of the supply, as that is earlier than the annual return dateCorrect
  2. B30 September 2024, as the older limit still applies
  3. C31 January 2025, the date of the annual return
  4. D31 March 2025, the end of the financial year of issue of the credit note

Explanation

Section 34(2) says the credit note must be declared not later than the thirtieth day of November following the end of the financial year of the supply, or the date of furnishing the relevant annual return, whichever is earlier. The FY 2023-24 supply gives 30 November 2024, earlier than January 2025. September was replaced by November.

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