Refund in GST – Applicability and Procedure
By: – Sanjeev Singhal
Goods and Services Tax – GST
Dated:- 23-8-2017
Procedure of Refund in GST is time bound and if not paid in time will be subject to interest. It seems to be simple . Circumstances are defined under which tax payer shall be eligible to file for refund and same shall be process as per the prescribed law. Refund of GST is prescribed in Section- 54 of the CGST Act,2017.
Applicability and Procedure
* Any person may make an application to the proper officer of IGST/CGST/SGST for refund of Tax and Interest, if any amount paid by him before the expiry of two years from the relevant date. But any taxable person , claiming any refund of any balance in electronic cash ledger u/s 49[6], may claim the same in return filed u/s 39.
* Any specialized agency of United Nation Organisation , consulate or embassy of foreign countries or any multilateral Financial Institution or Organization or any person or class of pe
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e necessary to file any documentary evidence but he may file declaration to certify that such tax and interest has not been passed on to any other person.
* On receipt of application if proper officer is satisfy that the whole or part of refund is refundable and will pass the order and the amount so determine shall be credited to fund u/s 57 i.e consumer welfare fund. [Section 54[5] ]
* Proper officer on zero rated supply of goods or services or both may refund 90% of the claim on provisional basis. And pass final order after due verification of documents.
* The above claim of refund shall be issued within 60 days from the date of receipt of application.
* However as mentioned in sub section 54[5], refundable amount instead of being credited to fund account , can be credited to applicant , if such amount is relatable to
* Refund of tax paid on zero rated supplies of goods or services or both or on input or input services used in making such zero rated supplies.
* Refund of
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e amount is less than ₹ 1000.
* Where the claim pertains to refund from Electronic cash ledger ,the proper officer shall provide the GST RFD-2 to the applicant as acknowledgement on the common portal.
* Claims other than electronic cash ledger, application shall be forward to proper officer who will examine the correctness of the application within 15 days of filing and acknowledge the same on Form-GST RFD -2 clearly stating the date of filing the application.
* Where any deficiency is noticed, the proper officer shall intimate the same on Form- GST RFD-3 to the applicant.
* To avoid the holding of capital of exporters, it has been provided to refund the 90% of the claim with in 7 days of the acknowledgment of claim. And will pass Order on Form -GST RFD-4 to the effect.
* Refund in case of international tourist ; [Section 15 of the IGST Act,2017]
* IGST paid by any international tourist taking supply of goods out of India. Tourist means person not normally resident o
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unds
* If the refund is not paid within 60 days as mentioned above , interest as may be prescribed shall be paid from the expiry of 60 days.
Relevant Rules for Refund – Procedure
Rules -89 [Application for refund of tax, interest ,fees or any other amount]
* Any person other than the person covered under notification under section -55 and refund of integrated tax paid on export of goods out of India, may file application on GST RFD-01.
Though the refund of balance in Electronic Cash Ledger may be claimed through the return filed as GSTR-3, GSTR-4 and GSTR-7 as per the provision of Section 49[6]
In case of supplies to SEZ unit or SEZ developer application shall be filed by supplier of goods or services as endorsed by the specified officer of the zone.
In case of supplies regarded as deemed export , the application shall be filed by recipient of deemed export supplies.
* The application in annexure -1 of Form-GST RFD -1 shall be filed along with any of the following document;
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Statement showing the detail of transaction considered as intra-state instead of inter-state.
* Statement showing the detail of amount of claim on account of excess payment of tax.
* Declaration to the effect that the tax, interest and any other amount has not been passed on to the any other person where the amount does not exceed ₹ 2 lacs. Declaration is not required in case of clause a,b,c,d or f of section 54[8].
* Certificate in Annexure -2 shall be issued by chartered accountant or cost accountants to the effect that the tax, interest and any other amount has not been passed on to the any other person where the amount exceed ₹ 2 lacs. Certification is not required in case of clause a,b,c,d or f of section 54[8]
* Where the refund relates to ITC , supplier will debit the Electronic Credit Ledger.
* In case of zero rated supply of goods or services or both under Bond or LUT as per the provision of section 16[3] of the IGST Act, 2017 refund of ITC shall be gran
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t , the proper officer make an order in GST RFD -06 stating the refund amount , amount of provisional payment and any demand adjusted against the refund. Where the demand is completely adjusted against the refund , the fact shall be stated in GST RFD-07 Part-A.
* Where proper officer feel that refund has to be upheld, he may do so by passing an order in Part B of GST RFD -07.
* Where whole or nay part of the refund is not payable , notice in GST RFD-08 will be issued requiring the applicant to file GST RFD-09 within 15 days.
* Where proper officer is satisfy that refund under section 54[1,2 and 8] is payable issue order in GST RFD -06 and payment advice on GST RFD-05.
Rule -93 [ Credit of amount of rejected refund claim ]
* Where any deficiency is communicated , the amount debited under rule-89 shall be re-credited to the electronic credit ledger a/c.
* Where any interest is payable along with refund shall be paid and intimated on GST RFD-05 .
Rule -95 [ Refund of tax to ce
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information from common portal of filing of return in GSTR-3 , designated cell of custom will process the claim of refund and transfer the amount to bank a/c of the applicant.
* The claim for refund for deficiency can be withheld.
Rule -96A
* Notification no.15/2017 Central Tax dated 1.7.2017 inserted this rules on refund of integrated tax paid on export of goods or services under bond or letter of undertaking.
* Any registered person supply goods or services for export without payment of IGST on bond or LUT, if he apply on GST RFD-11 to the Jurisdictional Commissioner and bind himself that he will pay the tax and interest if the export could not done as follows
* 15 days after the expiry of three months from the date of issue of invoice, if the goods are not exported out of India.
* 15 days after the expiry of one year from the date of issue of invoice of services , if the payment is not received in convertible foreign exchange.
* The detail of such export invoices shall
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