Refund under GST Regime
Q1. Is the word refund defined in the GST Act?
Ans. Yes, the word refund is defined in explanation to Section 54 of the CGST Act. As per the said definition, refund includes refund of tax paid on:
Q2. Is there any time limit to claim refund under Section 54?
Ans. Yes, as per Section 54, refund application is to be filed before the expiry of two years from the relevant date. Q3. What is relevant date for calculating the two years’ time limit? Ans. The relevant date is different for each situation and the same is provided below: Date on which the ship or the aircraft in which such goods are loaded, leaves India
Q4. Is there any form for claiming refund under Section 54?
Ans. Yes, the person claiming refund has to make an application in Form GST RFD-01.
(i) Judgment (ii) Decree (iii) Order (iv) Direction
of Appellate Authority, Appellate Tribunal or any Court
Q5. To whom should the claim for refund be made?
Ans. The refund application is to be made before the proper officer of IGST/CGST/SGST.
Q6. Can the refund of balance in cash or credit ledger be claimed?
Ans. Yes, as per provisions of Section 49(6), the balance of cash or credit after payment of tax, interest, penalty, fee or any other amount payment refund can be claimed as per provisions of Section 54. Once the refund is claimed, the amount of credit of CGST/SGST/ IGST (as the case may be) would be reduced to that extent.
Q7. Can any registered person claim the refund under Section 54?
Ans. No. Refund can only be claimed under specified circumstances: –
(a) zero rated supplies made without payment of tax(b) 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), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council
Provided further that no refund of unutilised input tax credit shall be allowed in cases where the goods exported out of India are subjected to export duty: Provided also that no refund of input tax credit shall be allowed, if the supplier of goods or services or both avails of drawback in respect of central tax or claims refund of the integrated tax paid on such supplies.
Q8. Can United Nations Organisation claim refund?
Ans. Yes. UNOs are entitled to claim refund of IGST/CGST/SGST paid on inward supplies of goods and/or services.
Q9. Is there any time limit for claiming refund by UNOs?
Ans. Yes, the refund application is required to be made before the expiry of 6 months from the last day of the Quarter in which such supply was received.
Q10. Can any person claim refund of any unutilised ITC at the end of the tax period?
Ans. No, only the following registered persons can claim refund of unutilised ITC:
- Persons undertaking exports (including other zero-rated supplies). Exception: No refund will be allowed on the goods exported out of India where such goods are subjected to export duty [second proviso to Section 54(3)];2. Credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on outward supplies (other than cases of nil-rated or fully exempted supplies)
Q11. Is there any condition to claim refund of unutilised ITC?
Ans. Yes. No refund of input tax credit shall be allowed if the supplier of goods or services avails drawback in respect of CGST or claims refund of IGST on such supplies
Q12. Is there any document to be enclosed along with refund claim? If yes, what are the documents to be submitted?
Ans. Yes, the following documents are required to be enclosed along with the refund application:
Q13. Is there any exemption for submitting the documents required for claiming refund?
Ans. Yes, if the refund claimed is less than 2 lakh rupees, then documentary evidence would not be required to be submitted. However, the applicant may file a declaration based on the documentary or other evidence available with him, certifying that the incidence of such tax and interest is not passed on to any other person.
Q14. Is there any way of obtaining a provisional sanction of refund claimed by the taxable person?
Ans. Yes, the proper officer may sanction refund of an amount up to ninety percent of the total amount of refund claimed, on a provisional basis in case of exporters. However, certain categories of persons may be notified, to whom provisional sanction of refund cannot be made.
Q15. Is there any time limit on proper officer to pass final order after accepting the refund application?
Ans. Yes, the proper officer shall issue the order within sixty days from the date of receipt of refund application.
Q16. Under what circumstances would refund be paid to the applicant?
Ans. On receipt of application, where the proper officer is satisfied as regards the refund application filed, he would pass an order sanctioning the refund. In the following situations, the refund sanctioned would be paid to applicant,- In all other cases, the amount sanctioned shall be credited to the Fund.
Q17. Can amount of refund sanctioned be adjusted towards any tax payable by the taxable person?
Ans. Yes, the refund due to the applicant can be adjusted towards tax, interest, penalty or any other amount which the applicant is liable to pay but which remains unpaid under the Act or under any earlier law.
Q18. Can refund sanctioned be withheld?
Ans. Yes, refund can be withheld until the applicant has furnished the required return or paid the tax, interest or penalty.
Q19. Is there a minimum amount specified below which no refund can be claimed?
Ans. No. However, it must be noted that if the amount of refund is less than rupees 1,000/-, then no refund can be paid.
Q20. Whether separate applications need to be filed for refund in case of export of goods and export of services?
Ans. Yes there shall be separate application and different procedure for refund of export of goods and export of services. Recommended Articles
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