Learn Steps of the Settlement process for Sales and Expiry returns in GST

1. Returns to supplier pertaining to goods purchased prior to 1st July 2017 -
   Customers to treat this as a supply and therefore must issue a Tax Invoice with GST.
2. Returns to suppliers pertaining to goods purchased on or after 1st July 2017 and before filing the annual return for the following financial year.
   Supplier to issue a Credit note with GST

Steps to be performed by Customer and Supplier

1. Customer to send goods under Delivery Challan to Supplier. (Use Adjustments-Purchase return menu option)
   
2. Expired and Saleable material to be sent separately under different Delivery Challans.
   The following stamping to be done on Delivery Challan –
   For Expiry/ Leakage and Breakages - “Leakage/Breakage/Expired goods not for sale & consumption”
   For Non-moving Saleable returns - “Non-moving/ Non-saleable goods return to supplier”
3. Goods will be received at Supplier End and segregated to identify returns pertaining to (A) Pre-GST purchases and (B) Post-GST purchase from Supplier.
   
   3A. For goods pertaining to Pre-GST Purchases from Supplier
   
   (i) Proforma Invoice with product and price details to be sent to the customer by the supplier as per physical stocks received from the customer (Supplier will Use adjustment menu-sales return option)
   (ii) When Customer is registered under GST and not under composition
   
   Customer to issue a Tax Invoice basis the details provided by Supplier and send it in soft copy within 7 Days of receipt of Proforma Invoice from Supplier.
   
   Tax Invoice issued by the customer should capture the Proforma Invoice number in respect of which the Tax Invoice is issued. (Customer will use purchase return (tax invoice) option under Adjustment menu and enter proforma invoice no in Ref no column header part. By pressing F5 in Purchase Return (Tax Invoice), the customer will be able to select entries already done in the purchase return option. By pressing F12, purchase history can be seen and by pressing F9, the invoice ref. can be selected.)
   
   (iii) Supplier to issue Credit Note with GST based on Tax Invoice issued by Customer. (Supplier will use Sales return (tax invoice) in the adjustments menu. By pressing F6, sales history can be seen and by pressing F9, the invoice ref. can be selected.
   
   (iv) In case the Customer fails to Issue a Tax Invoice within 7 Days, the Supplier will issue a Credit note without GST reimbursement (Supplier will use Adjustments - Sales Credit Note option. Old entries already done can be selected by pressing the F5 key). Please avoid it.
   
   3B. For goods pertaining to Post-GST Purchases from the supplier.
   
   (i) Supplier to issue Credit Note with GST to the customer (Supplier will use Adjustments-Sales Credit Note)
   (ii) Customer must reverse GST Input Credit equivalent to GST reimbursed on Credit Note by Supplier (Customer will use Adjustments-Purchase debit note option)
   (iii) In case a customer fails to reverse the GST Input Credit as mentioned in the point above, the Supplier will not be able to claim the set-off of such GST and may also be liable to pay interest as applicable to government. In such cases, the Supplier reserves the right to recover the GST amount with such interest from the customer through Debit Note.(Supplier will use sales debit note option).
   
   Note - Point number 3A(ii) & 3B(iii) mentioned in the table above will also apply to Credit Note issued by Supplier because of the price difference in supplies.

Settlement process for Sales and Expiry returns

Steps to be performed by Customer and Supplier

1. Customer to send goods under Delivery Challan to Supplier. (Use adjustments-purchase return option)
   
2. Expired and Saleable material to be sent separately under different Delivery Challans.
   The following stamping to be done on Delivery Challan –
   For Expiry/ Leakage and Breakages - “Leakage/Breakage/Expired goods not for sale & consumption”
   For Non-moving Saleable returns - “Non-moving/ Non-saleable goods return to supplier”
3. Goods will be received at Supplier End and entered in Adjustments menu- Sales return option.
   
4. Supplier to issue Credit Note without GST to the customer (Supplier will use Adjustments-Sales Return Invoice option)
   
5. Customer to enter credit note using Adjustments-Purchase Return Invoice option.