Transitional Provisions under GST Part5 –Treatment of Change in Price of Services and Goods After GST is implemented

There could be a situation where price of goods or services are revised after GST is implemented.  In this situation, question arises what will be treatment of such goods or services?

The above situation is addressed by section 178 of Model GST Law

Upwards Revision in Price of Goods and Services under CGST and SGST

In such a scenario, where contract was entered into prior to GST becoming effective and there is an upward revision in price then registered taxable person can issue a supplementary invoice or debit note within 30 days of the price revision.

Point to be noted: When a supplementary invoice is raised, the rates applicable under GST would be applicable not old rates.

Downwards Revision in Price of Goods and Services under CGST and SGST

In such a scenario, where contract was entered into prior to GST becoming effective and there is a downward revision in price then registered taxable person can issue a supplementary invoice or credit note note within 30 days of the price revision.

Point to be noted: When a supplementary invoice is raised, the rates applicable under GST would be applicable not old rates.

Also the recipient of service or goods should also reduce his input tax credit to such extent