REFUND UNER MODEL ‘GST’ LAW
By: – DR.MARIAPPAN GOVINDARAJAN
Goods and Services Tax – GST
Dated:- 17-10-2016
Refund
The term 'refund' is defined under Explanation (A) to Section 38 as including refund of tax on goods and/or services exported out of India, or refund of tax on the supply of goods regarded as deemed exports, or refund of unutilized input tax credit.
Type of refunds
The refund that may be got from the Board is the refund of any tax and interest and refund of unutilized input tax credit.
Refund of unutilized input tax credit
A taxable person may claim refund of any unutilized input tax credit at the end of any tax period. No refund of unutilized input tax credit shall be allowed in cases other than exports or in cases where the credit has accumulated of rate of tax on inputs being higher than the rate of tax on inputs. No refund of unutilized input tax credit shall be allowed in cases where the goods exported out of India are subject to export duty.
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return relating to such deemed exports is filed;
* in the case of goods returned for being remade, refined, reconditioned or subjected to any other similar process in any place of business, the date of entry into the place of business for the purposes aforesaid;
* in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of-
* receipt of payment in convertible foreign exchange, where the supply of service had been completed prior to the receipt of such payment; or
* issue of invoice, where payment for the service had been received in advance prior to the date of issue of the invoice;
* in case where the tax becomes refundable as a consequence of judgment, decree, order or direction of Appellate authority, Appellate Tribunal or any Court, the date of communication of such judgment, decree, order or direction;
* in the case of ref
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Act;
* in respect of supplies made to SEZ unit or a developer, or supplies regarded as deemed exports, by the unit or the developer or the recipient of deemed export supplies;
* The application shall be accompanied by any one of the following documentary evidences, as applicable, to establish that a refund is due to the applicant-
* the reference number of the order and a copy of the order passed by the proper officer or an appellate authority or any competent court resulting in such refund including refund of pre-deposit along with the reference number of the payment of the amount claimed as refund;
* a statement containing the number and date of shipping bills or bills of export and the number and the date of relevant export invoices, in a case where the refund is on account of export of goods;
* a statement containing the number and date of invoices as prescribed invoice rules in case of supply of goods made to an SEZ unit or a developer;
* a statement containing the nu
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efund arises on account of finalization of provisional assessment;
* a decision to the effect that the incidence of tax and interest claimed as refund has not been passed on to any other person, in a case where the amount of refund claim is less than ₹ 5 lakhs;
* a certificate in Annexure 2 of Form No. GST RFD-1 issued by a Chartered Accountant or a Cost Accountant to the effect that the incidence of tax and interest claimed as refund has not been passed on to any other person, in a case where the amount of refund claimed is ₹ 5 lakhs or more;
* If the refund claim relates to input tax credit, the electronic credit ledger shall be debited by the applicant in an amount to the amount to the refund so claimed;
* Where any taxable goods or services are exported without payment of tax, under bond or letter of undertaking refund of input tax credit shall be granted as per the following formula-
Refund amount= (Export turnover of goods + Export turnover of services) x net
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the date of filing of the claim for refund;
* Where any deficiencies are noticed, the proper officer shall communicate the deficiencies to the applicant in Form GST RFD – 3 through the common portal electronically requiring him to file a refund application after rectification of such deficiencies;
* If the proper officer is satisfied that the whole or part of the amount claimed is refundable, he may make an order in Form No. GST RFD – 5, sanctioning the amount of refund to which the applicant is entitled, mentioning the amount, if any, refunded to him on a provisional basis, amount adjusted against any outstanding demand and balance amount refundable;
* Such order shall be issued within 90 days from the date of receipt of application;
* Where the amount of refund is completely adjusted against any outstanding demand an order giving the details of adjustment may be issued in Form GST RFD – 6;
* If the amount of refund is not admissible or payable the proper officer shall issue
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of any appeal, review or revision is pending on any of the issues which form the basis of refund and if pending, the same has not been stayed by the appropriate authority or court;
* The proper officer, after scrutiny of the claim and on being prima facie satisfied that the amount claim as refund, shall make an order in Form GST RFD – 4 sanctioning the amount of refund due to the said applicant on provisional basis within a period not exceeding 7 days from the date of acknowledgment;
* The proper officer shall issue a payment advice in Form No. GST RFD – 8 for the amount sanctioned to 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;
* The refundable amount shall be paid to the applicant, instead of being credited to the Fund, if such amount relates to-
* refund of tax on goods and/or services exported out of India or on inputs used in the goods and/or services which
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urther proceeding or where any other proceeding under this Act is pending and the Commissioner/Board is of the opinion that grant of such refund is likely to adversely affect the revenue, he may, after giving the taxpayer an opportunity of being heard, withhold the refund tills such time as he may determine;
* Where a refund is withheld the taxable person shall be entitled to interest if as a result of the appeal or further proceeding he becomes entitles to refund;
* Where any interest is due and payable the proper officer shall make an order and a payment advice in Form GST RFD – 9, specifying the amount of refund which is delayed, the period of delay for which interest is payable and the amount of interest payable;
* The interest 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;
* No refund shall be paid to an applicant if an amount is less than ₹ 1000/-
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