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TaxTMI 
TaxTMI 
TaxTMI 
On account of export of goods - Zero-rated supply, Input Tax Credit got accumulated in Electronic Credit Ledger. A taxpayer can get refund either by showing export invoice under LUT i.e., without payment of tax or on payment of IGST i.e., with payment of tax.
Particulars | Export without payment of tax (Under LUT) | Export with payment of tax (On payment of IGST) |
Refund Route | ITC route by filing refund application | IGST Route |
Section 15 - Value of supply - GST Tax Invoice | In compliance with section 15 of showing invoice at transaction value - price actually paid or payable for supply of goods | In compliance with section 15 of showing invoice at transaction value - price actually paid or payable for supply of goods |
Turnover Restriction | ITC Refund is restricted to FOB value as per shipping Bill | IGST (Refund) is calculated on invoice value i.e., CIF |
In 'Handbook on Refunds under GST (January, 2026)' - ICAI edition - FAQ on Refund Claims on Exports with Payment of Tax (IGST) Pt. 3 (Page No. 55) provides as follows:
For refund purposes, which value should be considered - FOB or invoice value?
In terms of Rule 89 of the CGST Rules, 2017, the refund is computed based on the lower of the Free on Board (FOB) value or the invoice value declared for the export. This ensures that the refund amount does not exceed the actual value realized from the export transaction.
Let us take the example that FOB value in 100, Freight 40, Insurance 10 so the CIF value is 150.
If IGST route is chosen in reporting the export invoice, should the GST invoice be made at FOB value 100 and IGST be calculated on FOB value as restricted in ITC route? (as per FAQ) Or else IGST calculated on CIF (transaction value) is correct in IGST route.
If GST Tax Invoice is made at FOB value, then there will be difference in Turnover Reconciliation in GSTR-9C. GST Tax Invoice - 100, Commercial Invoice - 150 (booked in P&L) Can the PO ask to pay GST on differential amount (CIF less FOB) in litigation?