Refunds under GST:- (Prem Shankar Mishra)

Timely refund mechanism is essential in tax administration,

as it facilitates trade through release of blocked funds for

working capital, expansion and modernization of existing

business.

The provisions pertaining to refund contained in the GST

law aim to streamline and standardise the refund procedures

under GST regime. Thus, under the GST regime there will

be a standardised form for making any claim for refunds.

The claim and sanctioning procedure will be completely

online and time bound which is a marked departure from

the existing time consuming and cumbersome procedure.

It has been decided, however, that since the online refund

module is not available immediately, the refund process

would be handled manually and Circular No. 17/17/2017-

GST dated 15.11.2017 and Circular no. 24/24/2017-GST

dated 21.12.2017 prescribing the detailed procedure have

been issued.

SITUATIONS LEADING TO REFUND CLAIMS

The relevant date provision embodied in Section 54 of the CGST Act, 2017, provision contained in Section 77 of

the CGST Act, 2017 and the requirement of submission

of relevant documents as listed in Rule 89(2) of CGST

Rules, 2017 is an indicator of the various situations that

may necessitate a refund claim. A claim for refund may

arise on account of:-

1. Export of Goods or services

2. Supplies to SEZs units and developers

3. Deemed Export supplies

4. Refund of taxes on purchase made by UN or embassies etc

5. Refund arising on account of judgment, decree, order

or direction of the Appellate Authority, Appellate Tribunal or any court

6. Refund of accumulated Input Tax Credit on account of inverted duty structure

7. Finalisation of provisional assessment

8. Refund of pre-deposit

9. Excess payment due to mistake

10. Refunds to International tourists of GST paid on

goods in India and carried abroad at the time of their

departure from India

11. Refund on account of issuance of refund vouchers

for taxes paid on advances against which goods or

services have not been supplied

12. Refund of CGST & SGST paid by treating the supply as intra-State supply which is subsequently held as inter-State supply and vice versa.

Thus practically every situation is covered. The GST law

requires that every claim for refund is to be filed within 2

years from the relevant date.

Prem S Mishra

Adv. & Tax-Consultant