Goods and Services Tax – Started By: – viraf deboo – Dated:- 27-8-2018 Last Replied Date:- 29-8-2018 – We are manufacturer exporter registered under GST. We are exporting our goods to various countries. We want to know that, whether Application for Refund of ITC on Export of Goods & Services without payment of ITC under LUT as per Section 54(3) (i) and Rule 89(4) of CGST Act 2017 is compulsory / mandatory?? We have blocked / carry forward proportionate ITC in Electronic Credit Ledger as per formula given in Rule 89(4) of CGST Rules & to be applied for ITC refund in GST RFD-01A form on common portal. Kindly advice whether it is mandatory or optional ?? – Reply By Ramaswamy S – The Reply = Export can be made either with payment of IG
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l be granted as per the following formula – Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) x Net ITC ÷Adjusted Total Turnover Sir kindly advice that, whether it is compulsory / mandatory that we have to block / carry forward ITC in Electronic Credit Ledger as per above formula against zero rated goods & the same ITC will be applied for refund in GST RFD-01A FORM on common portal ?? – Reply By Ramaswamy S – The Reply = This is similar to rule 5 of erstwhile Cenvat Credit Rules. The refund of tax paid on inputs for exports without payment of IGST under LUT or bond is allowed as per the formula. The formula is the same as that of Notification 27/2012 CE(NT) issued under rule 5 of
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aneshan Kalyani – The Reply = Yes, indeed. – Reply By Yash Jain – The Reply = Sir, When we apply for refund U/s 54(3), the refund amount is automatically reversed in electronic credit ledger , which again depends on balance available as on date(I.e the balance on date when refund is filed)and not the date on which export is done/gaye 3b is filed. Sir, now from your question I interpretate that you will export zero rated and claim ITC refund, by keeping in ecl the amount of refund (as per formula). In this case I would request you to please evaluate the option of paying igst (by input tax reversal) and claim refund, as this is least time consuming option as compared to refund of Unutilized ITC. Regards – Reply By Ramaswamy S – The Reply = Se
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