(1) Where there is requirement for adjustment of the sale price or tax in relation to a taxable sale, the dealer making such adjustment may issue a credit note or debit note, as the case may be.

(2) Credit note or debit note as referred to in sub-rule(1) shall be issued within three months following the tax period, during which the original sale had taken place.

(3) An adjustment of the sale price and tax in relation to a taxable sale can be made, where-

(a) the sale is cancelled; or

(b) the nature of the sale is fundamentally altered; or

(c) the previously agreed consideration for the sale is altered by agreement with the buyer, whether due to reasons of quality or any other reason, consistent with the normal trade practice; or

(d) the goods or part thereof are returned to the seller and, the seller accepts the return of the goods subject to the condition that such return of goods is made within three months from the date of sale:

Provided that-

(i) a tax invoice in relation to the sale and the amount shown thereinas tax charged on the sale are incorrect as a result of occurrence of any one or more of the events specified above; and

(ii) a return has been filed for the tax period in which the sale took place and an incorrect amount of tax on that sale has been accounted for as a result of the occurrence of any one or more of the events specified above.

(4) where, due to occurrence of any or more of the events referred to in sub-rule (3) above, credit notes and debit notes are either issued or received, the dealer shall make adjustment as per the particulars contained in the credit notes and debit notes issued and/or received in the manner prescribed in sub-rule (5) and in sub-rule (6).

(5) Subject to sub-rule(2) and (3) above, the registered dealer, on receipt of credit notes and debit notes in any tax period, shall furnish the details of such credit notes and debit notes and work out its effect on input tax credit in Annexure-V of Form VAT-201; and shall make adjustment in return by reducing or increasing the ITC, as the case may be,

(6) Subject to sub-rule (2) and (3) above, the registered dealer, on issue of credit notes and/or debit notes by him in any tax period, shall furnish the details of such credit notes and debit notes and work out its effect on output tax in Annexure-V of Form VAT-201 for making adjustment in the return by reducing or increasing the output tax, as the case may be.

(7) In cases where the input tax credit and/or output tax are adjusted in any tax period, in the manner provided in sub-rule (5) and (6) due to occurrence of any or more of the events referred to in sub-rule (3), the revised return required to be filed as per the provisions of the clause (b) of sub section (4) of section 33 of the Act shall be deemed to have been filed; and

(8) Omitted.

(9) Omitted.