An advance is received by a supplier for a Service contract which got cancelled subsequently. The supplier has issued receipt voucher and paid the GST on such advance received. Whether he can claim refund of tax paid on advance or he is required to adjust his tax liability in his returns?
Frah Saeed Changed status to publish May 14, 2020
As in this case invoice has not been issued, credit note cannot be issued. Thus in this case while refunding advance he is required to issue a “refund voucher” in terms of section 31 (3) (e) of the CGST Act read with rule 51 of the CGST Rules.
The taxpayer in this case can apply for refund of GST paid on such advances by filing FORM GST RFD-01 under the category “Refund of excess payment of tax”. Self adjustment is not possible.
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Frah Saeed Changed status to publish May 14, 2020