GST : How to handle returns in case of Export (under Rebate) before actual physical export ( where goods are damaged before the physical export) (Doc ID 2450689.1)

Last updated on FEBRUARY 04, 2025

Applies to:

Goal

Return of item under Exports with rebate , before the actual physical export.

Business case is as below 

Sales order under Export ( with Rebate ) is booked , ship confirm is done. Since this is under exports with rebate, no liability is charged to customer at the point of AR invoice.
This is the only case in O2C where Reverse Charge taxes are applied ( self assessable checked ) and TPB is set as delivery so as to account the Tax portion on the order , but not on the Customer.
But before the actual physical export of the item / consignment, the material is damaged. 
As willfully damaged item cannot be shipped under Exports , it is returned back to the original organization inventory , where repair works will be carried forward
and will be sent for export again. 

In the case of item returned back to the warehouse and generation of AR Credit memo , find that system is actually NOT generating any reversal entries .

How to handle this case?

Solution

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