Text
The text below is the section as served by the CBIC tax information portal on 17 September 2026, with the portal's own amendment footnote markers (shown as small numerals before a bracket) and its footnotes.[1] The Act as published in the Gazette of India is the legal source.
Section 34, verbatim (show)
Section 34
*Section 34. Credit and debit notes.-
(1) 1[Where one or more tax invoices have] been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient 7[or where a discount referred to in clause (b) of sub-section (3) of section 15 is given], the registered person, who has supplied such goods or services or both, may issue to the recipient 2[one or more credit notes for supplies made in a financial year] containing such particulars as may be prescribed.
(2) Any registered person who issues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which such credit note has been issued but not later than 3[the thirtieth day of November] following the end of the financial year in which such supply was made, or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may be prescribed:
6[Provided that no reduction in output tax liability of the supplier shall be permitted, if the–
(i) input tax credit as is attributable to such a credit note, if availed, has not been reversed by the recipient, where such recipient is a registered person; or (ii) incidence of tax on such supply has been passed on to any other person, in other cases.]
(3) 4[Where one or more tax invoices have] been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goods or services or both, shall issue to the recipient 5[one or more debit notes for supplies made in a financial year] containing such particulars as may be prescribed.
(4) Any registered person who issues a debit note in relation to a supply of goods or services or both shall declare the details of such debit note in the return for the month during which such debit note has been issued and the tax liability shall be adjusted in such manner as may be prescribed.
Explanation.-For the purposes of this Act, the expression "debit note" shall include a supplementary invoice.
* Enforced w.e.f. 22nd June, 2017.
1. Substituted for "Where a tax invoice has" by s. 15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018) - Brought into force w.e.f. 01st February, 2019.
2. Substituted for "a credit note" by s. 15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018) - Brought into force w.e.f. 01st February, 2019.
3. Substituted (w.e.f. 1st October, 2022 vide Notification No. 18/2022 - CT dated 28.09.2022.) by s. 102 of The Finance Act 2022 (No. 6 of 2022). for "September".
4. Substituted for "Where a tax invoice has" by s. 15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018) - Brought into force w.e.f. 01st February, 2019.
5. Substituted for "a debit note" by s. 15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018) - Brought into force w.e.f. 01st February, 2019.
6. Substituted (w.e.f. 01.10.2025) by section 126 of the Finance (No. 7) Act, 2025.
7. Inserted (w.e.f. yet to be notified) by section 154 of The Finance Act, 2026 No. 4 of 2026 dated 30.03.2026.
34(1)Credit-note grounds
may issue to the recipient one or more credit notes for supplies made in a financial year containing such particulars as may be prescribed.Section 34(1)
The current grounds are excess taxable value or tax, returned goods and deficient goods or services. The law does not settle what makes a supply deficient. The further section 15 discount ground is pending under footnote 7.
Questions to answer on the file6 questions
Sub-section (2)
34(2)Credit-note declaration
shall declare the details of such credit note in the return for the month during which such credit note has been issuedSection 34(2)
The deadline is the earlier of the thirtieth day of November following the supply financial year and furnishing the relevant annual return. Tax adjustment follows the prescribed manner and is limited by the proviso.
Questions to answer on the file7 questions
34(2), proviso (i) and (ii)Reduction restrictions
no reduction in output tax liability of the supplier shall be permittedSection 34(2), proviso (i) and (ii)
For a registered recipient, attributable credit availed must have been reversed; in other cases, passed-on tax incidence bars reduction. The law does not settle how the supplier establishes recipient reversal. These conditions qualify sub-section (2)'s adjustment route.
Questions to answer on the file5 questions
34(3)Debit-note duty
shall issue to the recipient one or more debit notes for supplies made in a financial year containing such particulars as may be prescribed.Section 34(3)
The trigger is invoiced taxable value or tax below that applicable to the supply. The registered supplier issues the notes to the recipient.
Questions to answer on the file6 questions
34(4)Debit-note declaration
shall declare the details of such debit note in the return for the month during which such debit note has been issuedSection 34(4)
The issue month identifies the return. Adjustment of tax liability follows the prescribed manner.
Questions to answer on the file3 questions
34, ExplanationSupplementary invoices
the expression "debit note" shall include a supplementary invoice.Section 34, Explanation
The inclusion applies for the Act. A supplementary invoice therefore falls within the debit-note expression used here.
Other questions to answer on the file
Questions a reviewer answers from the engagement file, grouped by the part of the section they come from. They describe what the section asks; they do not decide it.
Scope the section as a whole
Questions to answer on the file1 question
Supplementary invoices the Explanation
Questions to answer on the file1 question
Frequently asked questions
Does the pending discount ground already apply?
No. Footnote 7 makes that insertion effective from a date yet to be notified. It remains pending.
Section 34(1)
When must a debit note be declared?
In the return for the month of issue. Liability is adjusted in the prescribed manner.
Section 34(4)
How can the supplier establish recipient credit reversal?
The law does not settle how the supplier establishes that reversal. The reduction proviso requires reversal of attributable credit if a registered recipient availed it.
Section 34(2), proviso
Amendment history
The CBIC text carries 8 footnotes. The table gives each in the source's own terms. Effective dates are as the footnotes state them.[1]
| Note | Provision | Change | Instrument | Effective from |
|---|---|---|---|---|
| the section | enforcement | — | 22 June 2017 | |
| 1 | 34(1) | substituted "Where one or more tax invoices have" for "Where a tax invoice has" | s.15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018)[2] | 1 February 2019 |
| 2 | 34(1) | substituted "one or more credit notes for supplies made in a financial year" for "a credit note" | s.15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018)[2] | 1 February 2019 |
| 3 | 34(2) | substituted "the thirtieth day of November" for "September" | s.102 of The Finance Act 2022 (No. 6 of 2022), brought into force by Notification No. 18/2022 - CT dated 28.09.2022[3][4] | 1 October 2022 |
| 4 | 34(3) | substituted "Where one or more tax invoices have" for "Where a tax invoice has" | s.15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018)[2] | 1 February 2019 |
| 5 | 34(3) | substituted "one or more debit notes for supplies made in a financial year" for "a debit note" | s.15 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018)[2] | 1 February 2019 |
| 6 | the proviso to 34(2) | substituted the proviso, barring a reduction in output tax liability in the two cases it names | s.126 of The Finance (No. 7) Act, 2025[5] | 1 October 2025 |
| 7 | 34(1) | inserts "or where a discount referred to in clause (b) of sub-section (3) of section 15 is given" as a further ground for a credit note | s.154 of The Finance Act, 2026 (No. 4 of 2026) dated 30.03.2026[6] | a date yet to be notified — not in force |
Relationship with other provisions
| Provision | Connection | Words that tie them |
|---|---|---|
| Section 31 | this provision requires Section 31 | 34(1) and 34(3) "Where one or more tax invoices have been issued for supply of any goods or services or both" |
| Section 39 | 34(2) requires Section 39 | 34(2) "shall declare the details of such credit note in the return for the month during which such credit note has been issued" |
| Section 44 | 34(2) requires Section 44 | 34(2) "or the date of furnishing of the relevant annual return, whichever is earlier" |
| Section 16 | the proviso to 34(2) requires Section 16 | proviso (i) "input tax credit as is attributable to such a credit note, if availed, has not been reversed by the recipient" |
| Section 15 | Section 15 requires this provision | 15(3)(b) "a credit note has been issued by the supplier... in accordance with the provisions of section 34" |
| Section 2 | Section 2 2(37) and 2(38) defined by this provision | 2(37) "a document issued by a registered person under subsection (1) of section 34" |
Circulars and notifications
Circulars and notifications in the CBIC repository that cite this section, newest first, by number, date and subject. A listing here does not say what an instrument decides; read the instrument.
Circulars (7)
| Number | Date | Subject |
|---|---|---|
| Circular No. 212/06/2024-GST | 26 June 2024 | Clarification on mechanism for providing evidence of compliance of conditions of Section 15(3)(b)(ii) of the CGST Act, 2017 by the suppliers withdrawn by a later instrument |
| Circular No. 195/07/2023-GST | 17 July 2023 | Clarification on availability of ITC in respect of warranty replacement of parts and repair services during warranty period |
| Circular No. 188/20/2022-GST | 27 December 2022 | Prescribing manner of filing an application for refund by unregistered persons |
| Circular No. 162/18/2021-GST | 25 September 2021 | Clarification in respect of refund of tax specified in section 77(1) of the CGST Act and section 19(1) of the IGST Act. |
| Circular No. 137/07/2020-GST | 13 April 2020 | Circular clarifying issues in respect of challenges faced by registered persons in implementation of provisions of GST issued - Reg |
| Circular No. 92/11/2019-GST | 7 March 2019 | Circular clarifying various doubts related to treatment of sales promotion scheme under GST |
| Circular No. 72/46/2018-GST | 26 October 2018 | Circular to clarify the procedure in respect of return of time expired drugs or medicines |
Notifications (4)
| Number | Date | Subject |
|---|---|---|
| Notification No. 03/2019-Central Tax | 29 January 2019 | Seeks to amend the CGST Rules, 2017. |
| Notification No. 74/2018-Central Tax | 31 December 2018 | Fourteenth amendment to the CGST Rules, 2017. amended by a later instrument |
| Notification No. 49/2018-Central Tax | 13 September 2018 | Notification amending the CGST Rules, 2017 (Tenth Amendment Rules, 2018). |
| Notification No. 10/2017-Central Tax | 28 June 2017 | Seeks to amend CGST Rules notification no 3/2017-Central Tax dt 19.06.2017 amended by a later instrument |
Unsettled questions
The words of section 34 do not answer these questions. Where one decides a matter on the file, the answer depends on the position taken on it.
- How is the supplier to establish that the recipient has reversed the input tax credit attributable to the credit note, when the Act gives him no means of seeing the recipient's ledger?
- What makes goods or services or both "found to be deficient" for the purposes of sub-section (1)? The sub-section makes deficiency a ground and gives no test for it.
See also
- Section 31 of the CGST Act, 2017: tax invoice
- Section 39 of the CGST Act, 2017: furnishing of returns
- Section 44 of the CGST Act, 2017: annual return
- Section 16 of the CGST Act, 2017: eligibility and conditions for taking input tax credit
- Section 15 of the CGST Act, 2017: value of Taxable Supply
References
- Central Board of Indirect Taxes and Customs. "Section 34. Credit and debit notes". Central Goods and Services Tax Act, 2017, CBIC tax information portal, with amendment footnotes 1 to 8. Retrieved 17 September 2026.
- The Central Goods and Services Tax (Amendment) Act, 2018. Cited in CBIC footnotes 1, 2, 4 and 5.
- The Finance Act, 2022. Cited in CBIC footnote 3.
- Notification No. 18/2022-Central Tax, dated 28 September 2022: Seeks to notify 01.10.2022 as the date on which provisions of sections 100 to 114, except clause (c) of section 110 and section 111 of Finance Act, 2022 shall come into force. Cited in CBIC footnote 3.
- The Finance (No. 7) Act, 2025. Cited in CBIC footnote 6.
- The Finance Act, 2026. Cited in CBIC footnote 7.
External links
- CGST Act, 2017, Section 34 on the CBIC tax information portal