<p><span>The Ministry of Finance's Circular No. 212/6/2024-GST, issued on June 26, 2024, provides guidelines for verifying compliance with Section 15(3)(b)(ii) of the CGST Act, 2017, regarding discounts offered through tax credit notes. Here are the key highlights:</span></p><ol start="1"><li><span><strong>Verification of ITC Reversal</strong>: To ensure that input tax credit (ITC) attributable to discounts is reversed by the recipient, suppliers must now obtain a certificate from the recipient, issued by a Chartered Accountant (CA) or Cost Accountant (CMA). This certificate should confirm that the recipient has duly reversed the ITC related to the discount.</span></li><li><span><strong>CA/CMA Certificate Details</strong>: The CA/CMA certificate should include details such as the relevant credit notes, invoice numbers, and the amount of ITC reversal. The certificate must contain a Unique Document Identification Number (UDIN), which can be verified online.</span></li><li><span><strong>Exceptions for Small Amounts</strong>: If the total tax involved in the discount does not exceed INR 5,00,000 in a financial year, the supplier may obtain an undertaking from the recipient instead of a CA/CMA certificate. This undertaking should confirm the ITC reversal along with necessary details.</span></li><li><span><strong>Past Period Compliance</strong>: The guidelines apply to both current and past periods. Suppliers may procure and provide the required certificates or undertakings for past periods where necessary, to demonstrate compliance during audits or investigations.</span></li><li><span><strong>Trade Notices and Implementation</strong>: Suitable trade notices should be issued to publicize the contents of this Circular and ensure uniform implementation across field formations. Any implementation difficulties should be reported to the Board for resolution.</span> <a href="https://cms.plasament.com/storage/shubham-pathak/circular-no-212-06-2024.pdf">circular-no-212-06-2024</a><br> </li></ol>