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The volume discount received on purchase and on retail (on sales) in the form of credit not without any adjustment of GST is not liable for GST.

Levy of GST — The applicant is in the business of supplying motor vehicles. The applicant in its regular course of business purchases the vehicles from the authorised supplier wherein it charges 28% GST plus applicable Cess. The Authorised supplier allows credit period of 30 days and also fixes sales targets to the applicant. Besides, on purchase of vehicles which are over and above the limit fixed on regular purchases, the applicant is also eligible for volume discount, which is paid on monetary terms. The Applicant sought Advance Ruling on the question whether the volume discount received on purchase or on retail (on sales) is liable for GST? If yes, under which HSN/SAC? The Authority ruled out that the volume discount received on purchase and on retail (on sales) in the form of credit not without any adjustment of GST is not liable for GST. — Kwality Mobikes (P) Ltd., In Re… [2019] 16 TAXLOK.COM 114 (AAR-Karnataka)

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