a. When seller has not issued invoice to the buyer, seller sends Debit Note to buyer to make a debit to buyer’s account.
b. When seller has issued invoice but undercharged the amount. In this case also seller sends a debit note to the buyer to make a debit of extra amount to buyer’s account.
c. In case of receipt of damaged goods by buyer, buyer returns damaged goods with a debit note to debit seller’s account.
Suppose B&T Company buys 10 numbers of Diesel Generators from Pummins worth ₹100000 per diesel generator and receives one damaged diesel generator. In this case B&T will issue a debit note to Pummins and will make a debit of ₹100000 to Pummins’ account. B&T will also return damaged DG to Pummins.