Hi, I have a cosmetics business in faridabad. I have few brands at my store. Due to lockdown some of the brands are getting closed at my store. My question is I bought my stock from a distributor who is no more working as a distributor with the brand. So the brand has now a new distributor. Now when I have to return the stock to the new distributor from whom I never bought any stock.. how can I get cleared with the gst on those products. Please tell me the process for it. As now in this case I cannot get any credit note, as the distributor is new. What can be the other option for it.
Show it as sale from your business at same price that's the only option available where no cost would be incurred by you as you could reverse same GST and when you show it as sale and same amount as purchase against it there will be no profit.
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Thank you
Hii
As per GST ACT 2017 ,
we have two way to deal this situation
1 you can show sale of products to new distributors
2 Debit credit note
in your situation you can choose first method
Hope via doing this your query resolved
Dear Sir,
Hope you are doing well !!
There are two option for the same:
1. Show the same as sales
2. Debit note.
It is advisable to show it as sale from your business.
Hi
In this case you have two options either show it as a sale on same value to Nullify the effect or issue a debit credit note.
Hi
Firstly, you can't raise any debit note / credit note under GST. GST credit / debit notes are only issued by the supplier and here you are the receiver.
The only option that I can suggest is to show sales to the new distributor at original purchase price. You may pay gst from the ITC availed on these purchases made from previous distributor. The new distributor shall get credit of taxes paid.
Hello,
In your case, the best option would be to declare it as a sale to the new distributor.
I hope this answer satisfies your requirements.
Regards,
CA Hunny Badlani
When you return the products, you will reverse the input credit that you would have availed on the purchase of these products.
