Posting of entries in respect of supply of goods or services or both in the supplier’s login of GSTN Portal
Business Transaction 1
B Ltd, Chennai issues order no 1 dt 1/9/2017 to A Ltd, Bangalore for supply of 10 numbers of mobile phones @ Rs.1000/- each.
A supplies 10 numbers of cell phones as per order on 15th September 2017.
If both are registered under GST in their respective states thenIt is an inter-state transaction
The invoice 1 dt 15/9/2017 will look like
A Ltd, Chennai(GSTN A001)
Sold to and Consignee
B Ltd Bangalore (GSTN B001)
| Value of cellphones- 10 nos @ Rs.1000/- each | – 10,000/- |
| IGST @ 20 % | – 2000/- |
| Total | – 12,000/- |
Also Read- GST Transaction Analysis: Supplies under Reverse Charge Mechanism
Business Transaction2
B Ltd, Chennai issues another order no 2 dt 1/9/2017 to A Ltd, Chennai for supply of 10 numbers of mobile phones @ Rs.1000/- each.
It is an intra-state transaction
The invoice 2 dt 15/9/2017 will look like
A Ltd, Chennai(GSTN A001)
Sold to and Consignee
B Ltd Chennai(GSTN B002)
| Value of cellphones- 10 no’s @ Rs.1000/- each | – 10,000/- |
| CGST @ 10 % | – 1000/- |
| SGST @ 10 % | – 1000/- |
| Total | – 12,000/- |
E way Bill
In both the scenarios E way bill has to accompany the consignment and to be generated by A Ltd or it’s transporter.
Returns —- GSTR1 in GSTN Portal
On 10th October 2017 A, ltd will upload file GSTR1in GST portal
Dashboard of A Ltd (Supplier) – After Profile screen
GSTIN No A001 Business Name : A Ltd
B2B Invoices
| Receiverwise summary | |||||||
| Receiver detail | No.of invoices uploaded | Counter party invoices pending for Action | Total Invoice value | Total taxable value | Total IGST | Total CGST | Total SGST |
| GSTN no of B – B001 – B Ltd | 1 | 0 | 12000 | 10000 | 2000 | 0 | 0 |
| GSTN no of B – B002 – B Ltd | 1 | 0 | 12000 | 10000 | 0 | 1000 | 1000 |
Returns —- GSTR2( Receiver)
On 15th October 2017, B ltd will upload file GSTR2 register in GST portal
Dashboard of B Ltd
GSTIN No B001 Business Name: B Ltd
B2B Invoices -Invoices summary
| Inv date | Supplier Details | Invoice No | Total Taxable value | Total invoice value | status | Action |
| 15-09-17 | B1 Ltd | 1 | 10000 | 12000 | submitted | |
| 15-09-17 | B2 Ltd | 2 | 10000 | 12000 | submitted |
Returns —- GSTR3 ( Supplier )
On 20th October2017 GSTR3 register in GST portal
Dash board of A – GSTIN No A001
Business Name A Ltd FY 2016-17 Return Period – Sep 2017 Status – Pending Due date-20-09-2017
| 5.Turnover Details | |
| Gross Turnover | 24000 |
| Export Turnover | 0 |
| Nil rated and Exempted T. O | 4000 |
| Non-GSTT. O | 0 |
| Net Taxable T. O | 20000 |
| 6.Outward Supplies: | |
| Details | |
| 7.Inward supplies: | |
| Details | |
| 8.Total Tax Liability |
–
| Total Tax Liability -Auto populated from GSTR3 | ||||||
| Sl. No | Month | Value | IGST | CGST | SGST | Type of supply |
| 1 | April | 24000 | 2000 | 1000 | 1000 | Goods |
| 2 | April | 0 | 0 | 0 | 0 | Services |
9. TDS credit-0
10.ITC Credit-0
11. Tax Paid-0
12. Refund adjustments-0
TAX PAYMENT
| Challan Details | ||||||
| Tax | Interest | Penalty | Fees | Others | Total | |
| CGST | 1000 | 0 | 0 | 0 | 0 | 1000 |
| IGST | 2000 | 0 | 0 | 0 | 0 | 2000 |
| SGST (State Name) | 1000 | 0 | 0 | 0 | 0 | 1000 |
| Total challan amount | 4000 | 0 | 0 | 0 | 0 | 4000 |
Treatment of Discount in GST
In October 2017
A Ltd issues credit note No CRN 001 dt 25th Oct 2017 to B Ltd. for Rs.100/- as given below
| Total value of cellphones supplied vide Inv no 1 dt 15.9.201 | Rs. 20,000/- |
| Discount @ 1% | 200/- |
| IGST@ 10% | 2/- |
| Total Value | 202/- |
As intention of discount is neither mentioned in the order nor at the time of supplies in the invoice IGST amount of Rs.2/- cannot be adjusted in the future tax liability by A Ltd.
Hence the entry in the books of A Ltd
Sales Dr – Rs.200/-
Cost of Sales / Sales Dr -Rs2
To B Ltd Rs.202/-
In GSTR1 the sales to B will be shown under credit Note in October 2017 return for Rs.202/-
B Ltd, the counter party, will be accounting in the books and will reflect the corresponding entry in the debit note entry column for Rs.202/-
Thus, recognizing the sales and purchases value less by Rs. 202/- by both in the financials and also in Returns
Had this Rs.2/- discount is referred either in invoice or in the order itself, then by relating the invoice in the credit note, tax credit of Rs.2/- can be availed and allowed as a deduction in tax payment.
As GST provides for strict rules in availing of Input tax credit, it’s reversal and re-availment of the reversed credit, a separate GL code is necessary in the financial to keep track of such entries not only for statutory purpose but also for the effective review.
The nature of such transactions falling in the above categories are reverse charge mechanism, treatment of tax paid but ITC not eligible, credit availed but payment not made within 180 days etc.
We shall deal with such transactions in the next volume of this article.
Author Bio
Dear Sir,
If I am selling goods to party ‘A’, say goods bearing MRP of Rs.100/- at a margin of 35%, i.e billed 100-35(discount)=65/-
and Mr. A directly sells those goods to ultimate customers at MRP of Rs.100/- then what will be the impacts…am i have to pay tax on discount also…as its a aggreed term or you can say this is the commission amount what we are paying to Mr. A
Dear Sir,
If I am selling goods to party ‘A’, say goods bearing MRP of Rs.100/- at a margin of 35%, i.e billed 100-35(discount)=65/-
and Mr. A directly sells those goods to ultimate customers at MRP of Rs.100/- then what will be the impacts…am i have to pay tax on discount also…as its a aggreed term or you can say this is the commission amount what we are paying to Mr. A..