The CBIC has issued the notifications for the issue of the Tax invoice for the sale of goods on approval basis.
Let’s summarise the Notifications issued:-
Extension of time limit for issue of Tax Invoice
The CBIC has issued the notification for the issue of the Tax invoice for the sale of goods on approval basis. To understand the notification we require to have some background knowledge about the sale of goods on approval basis and Section31 (7) of CGST Act.
Know About Section 31(7) of CGST Act
Section 31(7) of CGST Act states that, when the goods are transferred to the recipient before supply on sale on approval basis, the Tax Invoice for such supply must be issued earlier of Supply or 6 months from the date when goods were transferred to the recipient.
CBIC Notification No 66/2020
Now considering the supply chain problem due to the COVID 19, the supplier who has sent the goods to outside India for sale on approval basis and was required to issue an invoice from period 20th march 2020 to 30th October 2020, can issue the tax invoice within 31st October 2020 stated by CBIC Notification No. 66/2020 i.e. CBIC has issued the notifications for the issue of the Tax invoice
Illustration – If XYZ is a firm who sent their goods for the approval on 1st March 2020, the tax invoice for such supply must be issued on 30th September. But due to the pandemic situation the central government extent time for one month i.e. 31st October 2020.
Furthermore, you can provide this Credit note on filing GST Return Filing on 31st October 2020.
If you need any assistance regarding the annual GST return filing procedure or the GST Registration, please feel free to contact our business advisor at 8881-069-069.
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