Refund on export of services

[LAKSHMINARAYANAN TR]

Dear all

I would like to check the experience in this group with regards refund claims especially refund of IGST paid on export of services. Despite, we have filed manual GST RFD 01 A form with FIRC during last refund drive held in March 2018, we have not made any progress nor we had acknowledgment in form RFD 02 yet. No deficiencies communicated yet as well. Please share your experience, also you guys experience (% of refund value) undercutting demand in the process. If so how to legitimate challenge the same.

best regards

TRL

[Rajagopalan Ranganathan]

Sir,

Section 54 (10) & (11) of CGST Act, 2017 provides for withholding the refund in the circumstances narrated therein. Those provisions are as follows:-

Section 54 (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. and

Section 54 (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.

Since you have filed the refund cliam in form GST RFD 01 A you have to contact the officer with whom you have filed the refund claim. Since you have not received the acknowledgement you please verify whether you refund claim has been enter into official records and ascertain the status of your claim.

[YAGAY andSUN]

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 1(2) of Refund Rules 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

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[Ganeshan Kalyani]

Enquire with your jursidictional GST office.

AI Summary

Withholding of refunds under Section 54 permits suspension or deduction of GST refunds pending compliance or proceedings. Refunds for export of services may be withheld or reduced under Section 54: officers can withhold payment until outstanding returns or tax, interest or penalties are discharged and may deduct amounts owing from refunds; the Commissioner can withhold refunds pending appeals or other proceedings where grant of the refund would prejudice revenue, after giving an opportunity to be heard. Claimants should confirm filing and acknowledgement of RFD 01A, contact the jurisdictional officer for RFD 02 status, and ensure required documentary submissions under the refund rules.