Refunds
Procedure in GST
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Refunds
Procedure in GST |
Chapter XI of the Central Goods and Service Tax Act 2017
(Sec. 54 to Sec. 58) deals with Refunds Procedure in GST Law:
REFUNDS
- Refund
of tax.
(1) Any person claiming refund of any tax and interest, if
any, paid on such tax or any other amount paid by him, may make an application
before the expiry of two years from the relevant date in such form and manner
as may be prescribed:
Provided that a registered person, claiming refund of any
balance in the electronic cash ledger in accordance with the provisions of
sub-section (6) of section 49, may claim such refund in the return furnished
under section 39 in such manner as may be prescribed.
(2) A specialised agency of the United Nations Organisation
or any Multilateral Financial Institution and Organisation notified under the
United Nations (Privileges and Immunities) Act, 1947, Consulate or Embassy of foreign
countries or any other person or class of persons, as notified under section
55, entitled to a refund of tax paid by it on inward supplies of goods or
services or both, may make an application for such refund, in such form and
manner as may be prescribed, before the expiry of six months from the last day
of the quarter in which such supply was received.
(3) Subject to the provisions of sub-section (10), a
registered person may claim refund of any unutilised input tax credit at the
end of any tax period:
Provided that no refund of unutilised input tax credit shall
be allowed in cases other than––
(i) zero rated supplies made without payment of tax;
(ii) 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.
(4) The application shall be accompanied by—
(a) such documentary evidence as may be prescribed to
establish that a refund is due to the applicant; and
(b) such documentary or other evidence (including the
documents referred to in section 33) as the applicant may furnish to establish
that the amount of tax and interest, if any, paid on such tax or any other
amount paid in relation to which such refund is claimed was collected from, or
paid by, him and the incidence of such tax and interest had not been passed on
to any other person:
Provided that where the amount claimed as refund is less
than two lakh rupees, it shall not be necessary for the applicant to furnish
any documentary and other evidences but he may file a declaration, based on the
documentary or other evidences available with him, certifying that the
incidence of such tax and interest had not been passed on to any other person.
(5) If, on receipt of any such application, the proper
officer is satisfied that the whole or part of the amount claimed as refund is
refundable, he may make an order accordingly and the amount so determined shall
be credited to the Fund referred to in section 57.
(6) Notwithstanding anything contained in sub-section (5),
the proper officer may, in the case of any claim for refund on account of
zero-rated supply of goods or services or both made by registered persons,
other than such category of registered persons as may be notified by the
Government on the recommendations of the Council, refund on a provisional
basis, ninety per cent. of the total amount so claimed, excluding the amount of
input tax credit provisionally accepted, in such manner and subject to such
conditions, limitations and safeguards as may be prescribed and thereafter make
an order under sub-section (5) for final settlement of the refund claim after
due verification of documents furnished by the applicant.
(7) The proper officer shall issue the order under
sub-section (5) within sixty days from the date of receipt of application
complete in all respects.
(8) Notwithstanding anything contained in sub-section (5),
the refundable amount shall, instead of being credited to the Fund, be paid to
the applicant, if such amount is relatable to—
(a) refund of tax paid on zero-rated supplies of goods
or services or both or on inputs or input services used in making such
zero-rated supplies;
(b) refund of unutilised input tax credit under sub-section
(3);
(c) refund of tax paid on a supply which is not provided, either
wholly or partially, and for which invoice has not been issued, or where a
refund voucher has been issued;
(d) refund of tax in pursuance of section 77;
(e) the tax and interest, if any, or any other amount paid
by the applicant, if he had not passed on the incidence of such tax and
interest to any other person; or
(f) the tax or interest borne by such other class of
applicants as the Government may, on the recommendations of the Council, by
notification, specify.
(9) Notwithstanding anything to the contrary contained in
any judgment, decree, order or direction of the Appellate Tribunal or any court
or in any other provisions of this Act or the rules made thereunder or in any
other law for the time being in force, no refund shall be made except in accordance
with the provisions of sub-section (8).
(10) Where any refund is due under sub-section (3) to a
registered person who has defaulted in furnishing any return or who is required
to pay any tax, interest or penalty, which has not been stayed by any court,
Tribunal or Appellate Authority by the specified date, the proper officer may—
(a) withhold payment of refund due until the said
person has furnished the return or paid the tax, interest or penalty, as the
case may be;
(b) deduct from the refund due, any tax, interest, penalty,
fee or any other amount which the taxable person is liable to pay but which
remains unpaid under this Act or under the existing law.
Explanation.––For the purposes of this sub-section, the
expression “specified date” shall mean the last date for filing an appeal under
this Act.
(11) Where an order giving rise to a refund is the subject
matter of an appeal or further proceedings or where any other proceedings under
this Act is pending and the Commissioner is of the opinion that grant of such
refund is likely to adversely affect the revenue in the said appeal or other
proceedings on account of malfeasance or fraud committed, he may, after giving
the taxable person an opportunity of being heard, withhold the refund till such
time as he may determine.
(12) Where a refund is withheld under sub-section (11), the
taxable person shall, notwithstanding anything contained in section 56, be
entitled to interest at such rate not exceeding six per cent. as may be
notified on the recommendations of the Council, if as a result of the appeal or
further proceedings he becomes entitled to refund.
(13) Notwithstanding anything to the contrary contained in
this section, the amount of advance tax deposited by a casual taxable person or
a non-resident taxable person under sub-section (2) of section 27, shall not be
refunded unless such person has, in respect of the entire period for which the
certificate of registration granted to him had remained in force, furnished all
the returns required under section 39.
(14) Notwithstanding anything contained in this section, no
refund under sub-section (5) or sub-section (6) shall be paid to an applicant,
if the amount is less than one thousand rupees.
Explanation.—For the purposes of this section,––
(1) “refund” includes refund of tax paid on zero-rated
supplies of goods or services or both or on inputs or input services used in
making such zero-rated supplies, or refund of tax on the supply of goods
regarded as deemed exports, or refund of unutilised input tax credit as
provided under sub-section (3).
(2) “relevant date” means—
(a) in the case of goods exported out of India where a
refund of tax paid is available in respect of goods themselves or, as the case
may be, the inputs or input services used in such goods,––
(i) if the goods are exported by sea or air, the date on
which the ship or the aircraft in which such goods are loaded, leaves India; or
(ii) if the goods are exported by land, the date on which
such goods pass the frontier; or
(iii) if the goods are exported by post, the date of
despatch of goods by the Post Office concerned to a place outside India;
(b) in the case of supply of goods regarded as deemed
exports where a refund of tax paid is available in respect of the goods, the
date on which the return relating to such deemed exports is furnished;
(c) 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––
(i) receipt of payment in convertible foreign
exchange, where the supply of services had been completed prior to the receipt
of such payment; or
(ii) issue of invoice, where payment for the services had
been received in advance prior to the date of issue of the invoice;
(d) in case where the tax becomes refundable as a
consequence of judgment, decree, order or direction of the Appellate Authority,
Appellate Tribunal or any court, the date of communication of such judgment,
decree, order or direction;
(e) in the case of refund of unutilised input tax credit
under sub-section (3), the end of the financial year in which such claim for
refund arises;
(f) in the case where tax is paid provisionally under this
Act or the rules made thereunder, the date of adjustment of tax after the final
assessment thereof;
(g) in the case of a person, other than the supplier, the
date of receipt of goods or services or both by such person; and
(h) in any other case, the date of payment of tax.
- Refund
in certain cases.
The Government may, on the recommendations of the Council,
by notification, specify any specialised agency of the United Nations
Organisation or any Multilateral Financial Institution and Organisation
notified under the United Nations (Privileges and Immunities) Act, 1947,
Consulate or Embassy of foreign countries and any other person or class of
persons as may be specified in this behalf, who shall, subject to such
conditions and restrictions as may be prescribed, be entitled to claim a refund
of taxes paid on the notified supplies of goods or services or both received by
them.
- Interest
on delayed refunds.
If any tax ordered to be refunded under sub-section (5) of
section 54 to any applicant is not refunded within sixty days from the date of receipt
of application under subsection (1) of that section, interest at such rate not
exceeding six per cent. as may be specified in the notification issued by the
Government on the recommendations of the Council shall be payable in respect of
such refund from the date immediately after the expiry of sixty days from the
date of receipt of application under the said sub-section till the date of
refund of such tax:
Provided that where any claim of refund arises from an order
passed by an adjudicating authority or Appellate Authority or Appellate
Tribunal or court which has attained finality and the same is not refunded
within sixty days from the date of receipt of application filed consequent to
such order, interest at such rate not exceeding nine per cent. as may be
notified by the Government on the recommendations of the Council shall be
payable in
respect of such refund from the date immediately after the
expiry of sixty days from the date of receipt of application till the date of
refund.
Explanation.––For the purposes of this section, where any
order of refund is made by an Appellate Authority, Appellate Tribunal or any
court against an order of the proper officer under sub-section (5) of section
54, the order passed by the Appellate Authority, Appellate Tribunal or by the
court shall be deemed to be an order passed under the said sub-section (5).
- Consumer
Welfare Fund.
The Government shall constitute a Fund, to be called the
Consumer Welfare Fund and there shall be credited to the Fund,—
(a) the amount referred to in sub-section (5) of
section 54;
(b) any income from investment of the amount credited to the
Fund; and
(c) such other monies received by it,
in such manner as may be prescribed.
Utilisation
of Fund.
(1) All sums credited to the Fund shall be utiised by the
Government for the welfare of the consumers in such manner as may be
prescribed.
(2) The Government or the authority specified by it shall
maintain proper and separate account and other relevant records in relation to
the Fund and prepare an annual statement of accounts in such form as may be
prescribed in consultation with the Comptroller and Auditor-General of India.