1. Debit Note Meaning

When a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient a debit note containing the prescribed particulars.

2. Time Limit to Declare Debit Note

Any registered person who issues a debit note in relation to a supply of goods or services or both shall declare the details of such debit note in the return for the month during which such debit note has been issued and the tax liability shall be adjusted in such manner as may be prescribed.

3. Credit Note Meaning

Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient a credit note containing such particulars as may be prescribed.

4. Time Limit to Declare Credit Note

Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than September following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed.

5. Records of Credit Notes and Debit Notes

The records of the credit notes and debit notes have to be retained until the expiry of 72 months from the due date of furnishing of annual return. Where such accounts and documents are maintained manually, it should be kept at every related place of business mentioned in the certificate of registration and shall be accessible at every related place of business where such accounts and documents are maintained digitally.

6. Format for Credit Note and Debit Note

1. Name, address and Goods and Services Tax Identification Number of the supplier;

2. Nature of the document;

3. Consecutive serial number;

4. Date of issue;

5. Name, address and Goods and Services Tax Identification Number or Unique Identity Number, if registered, of the recipient;

6. Name and address of the recipient and the address of delivery, along with the name of state and its code, if such recipient is un-registered;

7. Serial number and date of the corresponding tax invoice or, as the case may be, bill of supply;

8. Value of taxable supply of goods or services, rate of tax and the amount of the tax debited to the recipient; and

9. Signature or digital signature of the supplier or his authorized representative.