GST – GST FAQ 3rd Edition – December, 2018 – 14 – 14. Refunds Q 1. What are the situations which may give rise to refund under GST? Ans. A claim for refund may arise on account of- 1. Export of Goods or services on payment of tax 2. Supply of goods or services to SEZs units and developers on payment of tax 3. Export of Goods or services under Bond/Letter of Undertaking, without payment of tax 4. Supply of goods or services to SEZs units and developers under Bond/Letter of Undertaking, without payment of tax 5. Deemed Exports (refund available to both supplier and recipient) 6. Refund of taxes on purchase made by UN Agencies, Embassies etc 7. Refund arising on account of judgment, decree, order or direction of the Appellate Authority, Appellate Tribunal or any court 8. Refund of accumulated Input Tax Credit on account of inverted duty structure 9. Finalisation of provisional assessment 10. Excess balance in electronic cash ledger 11. Excess payment of tax 12. Refunds to International t
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supplies are considered as zero rated (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit. Q 4. The GST Law allows exports to be made under a LUT in all cases. Is this statement true or false? Ans. The facility of export under LUT is available to all exporters in terms of notification No. 37/2017- Central Tax dated 4th October, 2017, except to those who have been prosecuted for any offence under the CGST Act or the IGST Act or any of the existing laws in force in a case where the amount of tax evaded exceeds two hundred and fifty lakh rupees. Para 2(d) of the Circular No. 8/8/2017-GST dated 4th October, 2017, mentions that a person intending to export under LUT is required to give a self-declaration at the time of submission of LUT that he has not been prosecuted. Persons who are not eligible to export under LUT are required to export under bond/bank guarantee Q 5. What is the time lim
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-03 (deficiency memo) where deficiencies are noticed. The said sub-rule also provides that once the deficiency memo has been issued, the claimant is required to file a fresh refund application after the rectification of the deficiencies. Q 8. Can deficiency memo be issued more than once for a refund claim? Ans. No. Rule 90 of the CGST Rules clearly states that once an applicant has been communicated the deficiencies in respect of a particular application, the applicant shall furnish a fresh refund application after rectification of such deficiencies. Thus, there can be only one deficiency memo for one refund application and once such a memo has been issued, the applicant is required to file a fresh refund application, manually in FORM GST RFD-01A. Once an application has been submitted afresh, pursuant to a deficiency memo, the proper officer will not serve another deficiency memo with respect to the application for the same period, unless the deficiencies pointed out in the original m
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What are the documents to be submitted along with a refund claim of accumulated ITC on account of export of goods and services without payment of tax? Ans. The following documents will have to be submitted : Copy of FORM RFD-01A filed on common portal Copy of ARN Copy of Statement 3A of FORM RFD-01A generated on common portal Copy of Statement 3 of FORM RFD-01A Printout of GSTR-2A and in cases where invoice details are not reflected in the GSTR-2A, the copy of Invoices w.r.t. input and input services. (Refer Circular No. 59/33/2018-GST dated04th September 2018) BRC/FIRC for export of services Undertaking / Declaration in FORM RFD-01A Q 12. What are the documents to be submitted along with a refund claim of IGST paid on export of services? Ans. The following documents will have to be submitted Copy of FORM RFD-01A filed on common portal Copy of ARN Copy of Statement 2 of FORM RFD-01A generated on common portal Printout of GSTR-2A and in cases where invoice details are not reflected in t
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017) and paying tax @ 0.1%, he can claim refund of unutilised ITC on account of inverted duty structure. Q 15. If such supplies are not zero rated, will it mean that the supplier will not be entitled to any refund on such supplies? Ans. No. The supplier who supplies goods at the concessional rate is also eligible for refund on account of inverted tax structure as per the provisions of clause (ii) of the first proviso to subsection (3) of section 54 of the CGST Act. Q 16. What is meant by the terms relevant period in so far as refund claims under GST are concerned. Is it different from tax period defined under the law? Ans. Section 2(107) of the CGST Act defines the term tax period as the period for which the return is required to be furnished. The terms Net ITC and turnover of zero rated supply of goods/services are used in the context of the relevant period in rule 89(4) of CGST Rules. The phrase relevant period has been defined in the said sub-rule as the period for which the claim h
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(s) for which refund claim has been filed, however, cannot spread across different financial years. Q 19. Can refund of taxes paid under existing laws (Central Excise/Service Tax) be made under GST? Ans. No. Refund claims of taxes paid under existing laws have to be dealt with as per the provisions of existing laws only. Q 20. How will refund claims made under existing laws be dealt with? Ans. As per section 142(3) of the CGST Act, the amount of refund arising out of such claims shall be refunded in cash. Further, the first proviso to the said sub-section provides that where any claim for refund of CENVAT credit is fully or partially rejected, the amount so rejected shall lapse and therefore, will not be transitioned into GST. Q 21. For Export of goods made under LUT, what is the time period within which proof of export need to be submitted? Ans. Rule 96A (1) of the CGST Rules provides that any registered person may export goods or services without payment of integrated tax after furni
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laims is permitted under GST? Ans. Manual filing of refund claims is permitted, vide circular no.17/17/2017-GST dated 15th November 2017 and circular no.24/24/2017 dated 24th November 2017 and circular no.36/10/2018-GST dated 13th March 2018, if the claim is on account of following (i) refund of unutilized input tax credit on account of zero rated supplies (ii) refund of unutilized input tax credit where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies) of goods or services or both except those supplies which are notified by the Government on the recommendations of the Council. (iii) Refund on account of supplies in terms of notification Nos. 40/2017-Central Tax (Rate) and 41/2017-Integrated Tax (Rate) both dated 23.10.2017 (iv) refund of tax on the supply of goods regarded as deemed exports; (v) refund of balance in the electronic cash ledger; and (vi) Refund claim by UIN
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/ quarters. The calendar month(s) / quarter(s) for which refund claim has been filed, however, cannot spread across different financial years. RFD-10 has to be filed by UIN entities on a quarterly basis. Q 26. Can refund claims be filed even if GSTR-1/3B for the particular period has not been filed? Ans. No. Refund claim for a tax period can be filed only after filing the details in FORM GSTR-1 for the said tax period. It is also to be ensured that a valid return in FORM GSTR-3B has been filed for the last tax period before the one in which the refund application is being filed. Q 27. Will provisionally accepted ITC be allowed as refund? Ans. Yes, it will be allowed for the time being. Since the date of furnishing of FORM GSTR-1 from July, 2017 onwards has been extended while the dates of furnishing of FORM GSTR 2 and FORM GSTR 3 for such period are yet to be notified, it has been decided by the competent authority to sanction refund of provisionally accepted input tax credit at this
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the common portal. (Para 4 of circular no. 59/33/2018-GST dated 04th September, 2018 refers). Q 30. In respect of deemed export supplies, who can claim refund? Ans. The third proviso to rule 89(1) of the CGST Rules allows the recipient or the supplier to apply for refund of tax paid on such deemed export supplies. Q 31. What are the documents required to be filed where the claim is on account of deemed exports? Ans. In case such refund is sought by the supplier of deemed export supplies, the documentary evidences as specified in notification No. 49/2017-Central Tax dated 18.10.2017 are also required to be furnished which includes an undertaking by the recipient of deemed export supplies that he shall not claim the refund in respect of such supplies and that no input tax credit on such supplies has been availed of by him. The undertaking should be submitted manually along with the refund claim. Similarly, in case the refund is filed by the recipient of deemed export supplies, an undert
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Supply of gold by a bank or Public Sector Undertaking specified in the notification No. 50/2017-Customs, dated the 30th June, 2017 (as amended) against Advance Authorisation Q 33. What are the situations in which refund of accumulated ITC is allowed under GST? Ans. Refund of accumulated ITC is allowed only when the credit accumulation is on account of zero rated supply or on account of inverted rate structure. Q 34. What are the situations in which refund of accumulated ITC will not be allowed even if it s a case of zero rated supplies or inverted rate structure? Ans. Refund of ITC will not be allowed where the goods exported out of India are subject to export duty or where the supplier claims refund of IGST paid on such supplies. The Government also has the power to notify supplies where refund of ITC will not be admissible even if such credit accumulation is on account of an inverted duty structure. Q 35. Has the Government exercised its powers to curtail refund of ITC in respect of
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lators 2 8602 Other rail locomotives; locomotive tenders; such as Diesel-electric locomotives, Steam locomotives and tenders thereof 3 8603 Self-propelled railway or tramway coaches, vans and trucks, other than those of heading 8604 4 8604 Railway or tramway maintenance or service vehicles, whether or not self-propelled (for example, workshops, cranes, ballast tampers, trackliners, testing coaches and track inspection vehicles) 5 8605 Railway or tramway passenger coaches, not self-propelled; luggage vans, post office coaches and other special purpose railway or tramway coaches, not self-propelled (excluding those of heading 8604) 6 8606 Railway or tramway goods vans and wagons, not self-propelled 7 8607 Parts of railway or tramway locomotives or rolling-stock; such as Bogies, bissel-bogies, axles and wheels, and parts thereof 8 8608 Railway or tramway track fixtures and fittings; mechanical (including electro-mechanical) signalling, safety or traffic control equipment for railways, tra
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f services ) x Net ITC /Adjusted total turnover. Q 38. How will the refund amount be calculated in case of claim of unutilised ITC on account of inverted rate structure? Ans. In the case of refund on account of inverted duty structure, refund of input tax credit shall be granted as per the following formula – Maximum Refund Amount = {(Turnover of inverted rated supply of goods) x Net ITC ÷ Adjusted Total Turnover} – tax payable on such inverted rated supply of goods. Q 39. What does Net ITC mean for the purpose of calculation of refund amount? Ans. Net ITC for the purpose of refund on account of zero rated supply means input tax credit availed on inputs and input services during the relevant period other than the input tax credit availed for which refund is claimed under sub-rules (4A) or (4B) or both of Rule 89 of CGST Rules. Net ITC for the purpose of refund on account of inverted rate structure means input tax credit availed on inputs during the relevant period other than the
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zero-rated supply of services where supply has been completed for which payment had been received in advance in any period prior to the relevant period reduced by advances received for zero-rated supply of services for which the supply of services has not been completed during the relevant period. Q 42. What does Adjusted Total Turnover mean for the purpose of calculation of refund amount? Ans. Adjusted Total turnover means the turnover in a State or a Union territory, as defined under clause (112) of section 2, excluding – (a) the value of exempt supplies other than zero-rated supplies; and (b) the turnover of supplies in respect of which refund is claimed under rule 89(4A) or (4B) or both, if any, during the relevant period. Q 43. For a claim of refund of IGST paid on export of goods, will the applicant need to file GST RFD-01/01A? Ans. No. As per rule 96 of the CGST Rules, 2017, the shipping bill filed by an exporter shall be deemed to be an application for refund of integrated tax
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.1(b); 2. Export invoices are submitted in GSTR-1/Table 6A and have correct shipping bill number, shipping bill date and port code; 3. The admitted tax liability of IGST under table 3.1(b) of GSTR-3B, is equal to, or greater than, the IGST amount claimed to have been paid under Table 6A of GSTR-1 of the corresponding period. Q 47. Can refund of IGST on export of goods be withheld under any circumstances? Ans. Yes. Situations where refund of IGST on goods can be withheld are as under (a) a request has been received from the jurisdictional Commissioner of central tax, State tax or Union territory tax to withhold the payment of refund due to the person claiming refund in accordance with the provisions of sub-section (10) or sub-section (11) of section 54; or (b) the proper officer of Customs determines that the goods were exported in violation of the provisions of the Customs Act, 1962. Q 48. What are the modalities to be followed when refund is withheld on the request of the jurisdiction
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be done manually till the refund module is operational on the common portal. Q 49. When will interest become payable in a refund claim? Ans. As per Section 56 of CGST Act, if any tax ordered to be refunded under section 54 (5) to any applicant is not refunded within sixty days from the date of receipt of application under section 54(1), interest at such rate not exceeding six per cent. as may be specified in the notification issued by the Government on the recommendations of the Council shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application under the said sub-section till the date of refund of such tax. Where any claim of refund arises from an order passed by an adjudicating authority or Appellate Authority or Appellate Tribunal or court which has attained finality and the same is not refunded within sixty days from the date of receipt of application filed consequent to such order, interest at such ra
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of pre-deposit) Q 50. What is the rate of interest notified by the Government for delayed settlement of refund claims? Ans. As per notification no.13/2017-Central Tax dated 28th June 2017, interest @6% will be payable under Section 56. (normal claims where payment is delayed beyond 60 days from the receipt of application). The same rate of interest @6% will be payable in cases of refund of pre-deposit. Interest @ 9% will be payable in cases of refund falling under proviso to Section 56. (cases where refund claim arises as a consequence of court order/judgement). Q 51. How will an order for payment of interest be made under GST? Ans. Rule 94 of the CGST Rules provide that an order for interest shall be made along with payment advice in Form GST RFD-05, specifying therein the amount of refund which is delayed, the period of delay for which interest is payable and the amount of interest payable, and such amount of interest shall be electronically credited to any of the bank accounts of th
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ate of receipt of application. Q 53. What is the relevant date within which claim for refund is to be filed? Ans. A claim for refund is to be filed within 2 years of a relevant date. Relevant date is different for different scenarios which is as under: (a) in the case of goods exported out of India where a refund of tax paid is available in respect of the goods themselves or, as the case may be, the inputs or input services used in such goods, – (i) if the goods are exported by sea or air, the date on which the ship or the aircraft in which such goods are loaded, leaves India, or (ii) if the goods are exported by land, the date on which such goods pass the frontier, or (iii) if the goods are exported by post, the date of despatch of goods by the Post Office concerned to a place outside India; (b) in the case of supply of goods regarded as deemed exports where a refund of tax paid is available in respect of the goods, the date on which the return relating to such deemed exports is filed
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e final assessment thereof; (g) in the case of a person, other than the supplier, the date of receipt of goods or services by such person; and (h) in any other case, the date of payment of tax. It is to be noted that for refund claim filed by UN bodies, Embassies etc the relevant date and the time period within which refund claim is to be filed is specified in Section 54(2) itself, which is before the expiry of six months from the last day of the month in which such supply was received. Q 54. What is the significance of relevant date for the purpose of refund? Ans. Relevant Date assumes significance to ascertain whether the refund claim has been filed within the period of limitation envisaged under the law. Thus, every refund claim is to be filed within 2 years from the relevant date. The relevant date is different for different scenarios. Thus, different relevant date is specified for refund on account of export of goods, export of services, accumulated input tax credit, finalisation
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of CGST+SGST) or notification No. 41/2017-Integrated Tax (Rate) dated 23.10.2017. (supplies to merchant exporters at concessional rate of IGST). Thus, in respect of deemed export supplies/merchant exports, the option given under section 16(3) of IGST Act, 2017, (of either paying tax and claiming refund of IGST or exporting under Bond and claiming refund of ITC), gets restricted and the zero-rated supplier can only avail of refund of ITC, as per Rule 89, in such cases. Q 57. Are refunds of IGST on export of goods automated under the GST Law? Ans. Yes. The IGST refund module has an in-built mechanism to automatically grant refund after validating the Shipping Bill data as available in ICES with the GST Returns data transmitted by GSTN. The matching between the two data sources is done at Invoice level and any mismatch of the laid down parameters returns shows error code. Q 58. How will acknowledgment of manual refund claims be given? Ans. The refund claim will be verified for its complet
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ount of tax evaded exceeds two hundred and fifty lakh rupees. Q 60. How will provisional refunds be processed? Ans. The proper officer, after scrutiny of the claim and the evidence submitted in support thereof and on being prima facie satisfied that the amount claimed as refund under sub-rule (1) is due to the applicant in accordance with the provisions of section 54(6), shall make an order in FORM GST RFD-04, sanctioning the amount of refund due to the said applicant on a provisional basis within a period not exceeding seven days from the date of the acknowledgement under rule 90. The proper officer shall issue a payment advice in FORM GST RFD-05 for the amount sanctioned under sub-rule (2) and the same shall be electronically credited to any of the bank accounts of the applicant mentioned in his registration particulars and as specified in the application for refund. Q 61. Will provisional refund be granted separately under each head or will it be combined? Ans. Provisional refund sh
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rovisional refund, final order is to be issued within sixty days (after due verification of the documentary evidences) of the date of receipt of the complete application form. The proper officer has to validate the refund statement details with details in Form GSTR-1 (or Table 6A of Form GSTR-1) available on the common portal. Details of IGST paid, in case of export of services on payment of IGST, also needs to be verified from Form GSTR 3 or Form GSTR 3B as the case may be, filed by the applicant and it needs to be verified that the refund amount claimed shall be less than the tax paid on account of zero rated supplies as per Form GSTR-3 or 3B as the case may be. In case of export under bond / LUT, debit to the electronic credit ledger need to be checked up. If the sanctionable amount is less than the applied amount or if the refund claim is proposed to be rejected, then a notice has to be issued to the applicant in Form GST RFD-08. The applicant has to reply within 15 days of receipt
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ed with that tax authority to whom the taxpayer has been assigned and shall be processed and sanction order for all taxes would be issued by the said authority. (In case the taxpayer has not been assigned, he can submit his application with any tax authority). However, payment of the sanctioned refund amount shall be made only by the respective tax authority of the Centre or State Government. The payment of the sanctioned refund amount in relation to Central Tax/ Integrated Tax/ /Cess shall be made by the Central Tax authority while payment of the sanctioned refund amount in relation to ST/UT would be made by the State Tax/UT tax authority. Q 66. How will communication between Central and State tax authorities take place? Ans. The refund order issued either by the Central Tax authority or the State Tax/UT Tax authority shall be communicated to the concerned counterpart tax authority within seven days for the purpose of payment of the relevant sanctioned refund amount of tax or cess as
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proper officer of Central or State Tax, as the case may be, shall issue FORM GST RFD-05 and send it to the DDO for onward transmission for release of payment. After release of payment by the respective PAO to the applicant s bank account, the nodal officer of Central tax and State tax authority shall inform each other. The manner of communication as referred earlier shall be followed at the time of final sanctioning of the refund also. Q 67. Who can file claim refund on account of supply to SEZs? Ans. The DTA supplier will have to file the refund claim in such cases. Q 68. When can the DTA supplier file refund claims on account of supplies made to SEZ units? Ans. The proviso to Rule 89 stipulates that in respect of supplies to a Special Economic Zone unit or a Special Economic Zone developer, the application for refund shall be filed by the – (a) supplier of goods after such goods have been admitted in full in the Special Economic Zone for authorised operations, as endorsed by the spe
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made by the recipient to the supplier for authorised operations as defined under the Special Economic Zone Act, 2005, in a case where the refund is on account of supply of services made to a Special Economic Zone unit or a Special Economic Zone developer; 3. a declaration to the effect that the Special Economic Zone unit or the Special Economic Zone developer has not availed the input tax credit of the tax paid by the supplier of goods or services or both, in a case where the refund is on account of supply of goods or services made to a Special Economic Zone unit or a Special Economic Zone developer. Q 70. Whether the DTA supplier would be entitled to provisional refund? Ans. As per Section 54(6) of the CGST Act, the proper officer may, in the case of any claim for refund on account of zero-rated supply of goods or services or both made by registered persons, other than such category of registered persons as may be notified by the Government on the recommendations of the Council, refun
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pplies, the documentary evidences as specified in notification no.49/2017-Central Tax dated 18.10.2017 are required to be furnished. The notification specifies the following documents. 1. Acknowledgment by the jurisdictional Tax officer of the Advance Authorisation holder or Export Promotion Capital Goods Authorisation holder, as the case may be, that the said deemed export supplies have been received by the said Advance Authorisation or Export Promotion Capital Goods Authorisation holder, or a copy of the tax invoice under which such supplies have been made by the supplier, duly signed by the recipient Export Oriented Unit that said deemed export supplies have been received by it. 2. An undertaking by the recipient of deemed export supplies that no input tax credit on such supplies has been availed of by him. 3. An undertaking by the recipient of deemed export supplies that he shall not claim the refund in respect of such supplies and the supplier may claim the refund. The procedure r
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eds to be complied with. Q 74. What will be the eligible amounts for refund in case of deemed exports? Ans. While filing RFD-01A (recipient of deemed exports), taxpayers need to enter the amount that they want to get as refund. The lowest of the following three categories are eligible for refund. 1. Balance in the Electronic Credit Ledger 2. ITC availed for the particular tax period 3. Amount entered by taxpayer in refund claim matrix. Q 75. In case the supplier claims refund on account of deemed export supplies, will the recipient be eligible for refund of ITC in respect of other inputs/input services which have been used in making zero rated supply? Ans. Yes. As per Rule 89(4A) In the case of supplies received on which the supplier has availed the benefit of notification No. 48/2017-Central Tax dated the 18th October, 2017, refund of input tax credit, availed in respect of other inputs or input services used in making zero-rated supply of goods or services or both, shall be granted.
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ill supply goods under tax invoice to the recipient EOU / EHTP / STP / BTP unit. (iii) On receipt of such supplies, the EOU / EHTP / STP / BTP unit shall endorse the tax invoice and send a copy of the endorsed tax invoice to – (a) the registered supplier; (b) the jurisdictional GST officer in charge of such registered supplier; and (c) its jurisdictional GST officers. (iv) The endorsed tax invoice will be considered as proof of deemed export supplies by the registered person to EOU / EHTP / STP / BTP unit. (v) The recipient EOU / EHTP / STP / BTP unit shall maintain records of such deemed export supplies in digital form, based upon data elements contained in Form-B (appended herewith). The software for maintenance of digital records shall incorporate the feature of audit trail. While the data elements contained in the Form-B are mandatory, the recipient units will be free to add or continue with any additional data fields, as per their commercial requirements. All recipient units are r
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the conditions subject to which supply of goods ( to merchant exporters ) at concessional rate may be made? Ans. Supplies at concessional rate of 0.1% can be made subject to compliance with conditions mentioned in notification no. 40/2017-Central Tax (Rate) dated 23.10.2017. (Corresponding IGST notification no. 41/2017-Integrated Tax (Rate) dated the 23rd October, 2017,) The conditions are as under (i) the registered supplier shall supply the goods to the registered recipient on a tax invoice; (ii) the registered recipient shall export the said goods within a period of ninety days from the date of issue of a tax invoice by the registered supplier; (iii) the registered recipient shall indicate the Goods and Services Tax Identification Number of the registered supplier and the tax invoice number issued by the registered supplier in respect of the said goods in the shipping bill or bill of export, as the case may be; (iv) the registered recipient shall be registered with an Export Promoti
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ner Deport, Airport or Land Customs Station from where they shall be exported; (viii) in case of situation referred to in condition (vii), the registered recipient shall endorse receipt of goods on the tax invoice and also obtain acknowledgement of receipt of goods in the registered warehouse from the warehouse operator and the endorsed tax invoice and the acknowledgment of the warehouse operator shall be provided to the registered supplier as well as to the jurisdictional tax officer of such supplier; and (ix) when goods have been exported, the registered recipient shall provide copy of shipping bill or bill of export containing details of Goods and Services Tax Identification Number (GSTIN) and tax invoice of the registered supplier along with proof of export general manifest or export report having been filed to the registered supplier as well as jurisdictional tax officer of such supplier. Q 79. What happens if the merchant exporter fails to export such goods? Ans. The registered s
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ed in respect of inputs received under the said notifications for export of goods and the input tax credit availed in respect of other inputs or input services to the extent used in making such export of goods, shall be granted. Thus, a merchant exporter (recipient) can claim refund of ITC in respect of supplies on which the supplier has availed benefit of notification No. 40/2017-Central Tax (Rate) dated the 23rd October, 2017 (at concessional rate of 0.1%). This entire 0.1% paid (along with ITC of other supplies on which concessional rate of GST has not been availed but used in export of such goods) will be available as refund. For other exports made by merchant exporters in respect of which concessional rate of GST has not been availed, the merchant exporters will be entitled to refund of accumulated ITC in terms of Rule 89(4) by resort to the following formula Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) x Net ITC ÷Adju
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l Tax (Rate) dated 23.10.2017 compulsory? Ans. No. The benefit of supplies at concessional rate is subject to certain conditions and the said scheme is optional. The option may or may not be availed by the supplier and / or the recipient and the goods may be procured at the normal applicable tax rate. Q 83. Can the merchant exporter export goods (in respect of which concessional rate of duty is availed by the supplier) on payment of IGST and claim refund of IGST? Ans. No. The exporter of such goods can export the goods only under LUT / bond and cannot export on payment of integrated tax. In this connection, Rule 96(10) of the CGST Rules as amended from time to time may be referred. Q 84. Will refund of Compensation Cess be also admissible under GST? Ans. Yes. Circular No.1/1/2017-Compensation Cess issued by Board clarifies that provisions of section 16 of the IGST Act, 2017, relating to zero rated supply will apply mutatis mutandis for the purpose of Compensation Cess (wherever applica
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und of accumulated ITC can be claimed in such situations, however the rebate route i.e. payment of IGST and claiming refund of compensation cess of IGST paid will not be permissible in in such cases. In such cases they cannot utilise the compensation cess paid on inputs for payment of IGST in view of the proviso to section 11(2) of the Cess Act, which allows the utilization of the input tax credit of cess, only for the payment of cess on the outward supplies. Accordingly, they cannot claim refund of compensation cess in case of zero-rated supply on payment of integrated tax. Q 85. How can refunds of excess balance in the electronic cash ledger be claimed? Ans. Excess balance in the cash ledger after making good all liabilities, would be available as refund to the registered person. Presently this refund is also available through RFD-01A procedure. Section 49(6) enables grants of refund of excess balance in the cash ledger and reads as under Q 86. Is there any time limit within which re
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88. Interest on delayed payment (if refund is not paid within 60 days from the date of receipt of application) will be paid right from the first date of receipt of claim till the date of payment. Is this statement true? Ans. As per section 56 of CGST Act, 2017, If any tax ordered to be refunded under section 54(5) to any applicant is not refunded within sixty days from the date of receipt of application under section 54(1), interest at such rate not exceeding six per cent. as may be specified in the notification issued by the Government on the recommendations of the Council shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application under the said sub-section till the date of refund of such tax. Thus, interest liability will start after expiry of 60 days of receipt of application. Q 89. If refund arises on account of finalisation of provisional assessment under GST, will the registered person need to make a
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the said order in a case where the refund arises on account of the finalisation of provisional assessment; (b) a declaration to the effect that the incidence of tax, interest or any other amount claimed as refund has not been passed on to any other person, in a case where the amount of refund claimed does not exceed two lakh rupees:; (c) a Certificate in Annexure 2 of FORM GST RFD-01A issued by a chartered accountant or a cost accountant to the effect that the incidence of tax, interest or any other amount claimed as refund has not been passed on to any other person, in a case where the amount of refund claimed exceeds two lakh rupees: Q 92. Is manual filing of claims permitted for refunds arising as a consequence of finalisation of provisional assessment? Ans. No. Q 93. In case refund claim is filed as a consequence of any Court judgement, when will interest become due? Ans. For a claim of refund of tax paid during the course of proceedings & which the Courts have held as not pay
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section 56 shall be payable in respect of such refund from the date of payment of the amount till the date of refund of such amount. Thus, interest liability starts from the date of making of payment (and not the date of filing of application for refund) in the case of amounts paid as pre-deposit. Q 94. What are the documentary evidences that need to accompany the refund claim, in cases where the claim arises a consequence of any court order or judgement? Ans. Such refund claims are to be filed in form GST RFD-01 on the common portal. The application has to be accompanied by the following documentary evidences in Annexure 1 in Form GST RFD-01A, as applicable, to establish that a refund is due to the applicant, namely:- (a) the reference number of the order and a copy of the order passed by the proper officer or an appellate authority or Appellate Tribunal or court resulting in such refund or reference number of the payment of the amount specified in sub-section (6) of section 107 and s
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enrichment occurs when a person retains money or benefits which in justice, equity and good conscience, belong to someone else. (b) That no person can be allowed to enrich inequitably at the expense of another. A right of recovery under the doctrine of unjust enrichment arises where retention of a benefit is considered contrary to justice or against equity The concept is inbuilt in Section 54(5) read with 54(8) of the CGST Act, 2017. Every claim of refund sanctioned will be credited to the Consumer Welfare Fund in terms of section 54(5) of CGST Act, 2017. It will, instead of being credited to the fund, be paid to the claimant in situations mentioned in Section 54(8). Thus, the principle will not apply to refund claims arising on account of zero rated supply, refund of accumulated ITC on account of zero rated supply and inverted rate structure, where wrong tax is paid (IGST instead of C+SGST & vice versa), where tax has been paid on advances but no supply is made and no invoice has
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he incidence of tax, interest or any other amount claimed as refund has not been passed on to any other person However, the aforesaid declaration/certificate is not required to be furnished in respect of cases covered under clause (a) or clause (b) or clause (c) or clause (d) or clause (f) of section 54 (8). That is for cases covered by clause a to d & f of Section 54, since by default the doctrine of unjust enrichment does not apply, there is no requirement of any declaration or certificate to prove non passing of the incidence of tax to any other person. Explanation to Rule 89 expressly states that where the amount of tax has been recovered from the recipient, it shall be deemed that the incidence of tax has been passed on to the ultimate consumer. Thus, if Revenue has cogent evidence to show that the amount of tax has been recovered from the recipient, then it will be presumed that the incidence of tax has been passed on the consumer and the declaration/certificate given by the
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