What Is SCN In GST?

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What Is SCN In GST?

In the dynamic landscape of the Goods and Services Tax (GST), the Supplier’s Credit Note (SCN) emerges as an essential instrument that facilitates rectifications, adjustments, or modifications in transactions, ensuring accuracy and compliance within the taxation framework. This document plays a pivotal role in rectifying errors, addressing discrepancies, and maintaining transparency in business transactions.

Essence Of Supplier’s Credit Note (SCN)

  • Purpose: An SCN is a document issued by a supplier to rectify errors or omissions in an original tax invoice or a previously issued debit note. It serves as a means to adjust the taxable value, tax amount, or other particulars of a supply.
  • Rectification Scenarios: SCNs are typically issued in cases where there are errors in the original tax invoice, such as incorrect pricing, erroneous tax calculations, quantity discrepancies, or other inaccuracies requiring adjustment.

Key Elements And Functions

  • Document Details: An SCN includes essential information such as the supplier’s details, recipient’s details, SCN number, date of issue, original invoice details being corrected, reasons for issuing the credit note, revised transaction details, and adjustments made.
  • Impact on Tax Liability: SCN issuance impacts the tax liability of both the supplier and the recipient. It allows for adjustments in input tax credit (ITC) claimed by the recipient and helps the supplier rectify tax liabilities.

Compliance And Regulatory Framework

  • SCN as Legal Documentation: Under the GST framework, SCN holds legal significance and acts as a valid document for initiating corrections in transactions. It ensures compliance with GST regulations by documenting modifications in supply details.
  • Timely Issuance: Timely issuance of SCNs is crucial, as they enable rectifications within prescribed time limits specified under GST regulations, ensuring accuracy in tax filings and avoiding penalties for non-compliance.


In the intricate web of GST regulations, the Supplier’s Credit Note (SCN) serves as a corrective mechanism, providing a structured framework for rectifying errors and adjusting transactional details. Its role in facilitating transparent, compliant, and accurate business transactions underscores its significance in maintaining the integrity of the GST ecosystem.

In the tapestry of taxation and commerce, SCN in GST embodies the essence of rectification and compliance, ensuring that the threads of transactions are woven with precision, accuracy, and transparency within the broader canvas of GST regulations.


How Do I Respond To SCN In GST?

Prepare a written response to the show cause notice, addressing each of the allegations made in the notice. Make sure to provide a clear and concise explanation for each point, and provide supporting evidence wherever necessary. Submit your response to the GST authorities within the time specified in the notice.

Who Can Issue SCN Under GST?

SCNs issued by the Officers of Audit Commissionerates and Director General GST Inteligence: As per this circular, the central tax officers of Audit Commissionerates and Directorate General of Goods and Services Tax Intelligence (“DGGSTI”) shall exercise the powers only to issue show cause notices.

What Is The Time Limit For SCN?

In suppression cases, in terms of Sec 74(10), the time limit will be 5 years. In terms of Sec 73(2), SCN is to be issued atleast 3 months prior to the above said time limit of issuance of OIO. Whereas, in suppression cases, SCN is to be issued atleast 6 months prior to the issuance of OIO.

How Do I Draft SCN Under GST?

For example, in case of manufacturer, kind of goods manufactured or not etc. Whether gist of intelligence/information resulting in further inquiry/ investigation has been mentioned in the SCN or not. Whether grounds for invoking extended period of limitation has been clearly explained in the SCN.

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