Reg.: GST Refumd

[Yash Jain]

Dear Sir/Madam,

We had exported goods as zero rated in FY 2017-18 against which we had accumulated significant ITC (input tax credit), in form of CGST and SGST.

But in FY 2018-19, due to strong domestic sales (inter state) we have utilized full ITC (CGST) portion , leaving us with balance of SGST only.

Now my question in this regard is as follows,

1. Can I claim CGST credit portion from SGST balance apart from SGST refund.

2.If I m not eligible for CGST refund from sgst portion, then can I apply for SGST portion atleast.

Please reply

Rgds

[Nash Industries I Pvt Ltd]

SGST can be utilised for payment of IGST.

SGST cannot be utilised for CGST.

Regards,

S.Ramaswamy

[Yash Jain]

Dear Sir,

Thanks for the Reply.

But my query is that as to whether Can i Claim "ITC Refund" For SGST Only (As in my Electronic Credit Ledger at present I Only have SGST Balance. My CGST & IGST Balance have been utilized fully).

Further to aforesaid, Can i Also claim Refund of CGST (I have no balance of CGST), but is it possible to Take CGST Portion refund from my SGST Balance

(Refund is on account of Accumulated Input Tax Credit).

Regards

[Nash Industries I Pvt Ltd]

Since your domestic supplies have increased, please utilize the balance of SGST for the next payment instead of going for refund.

My suggestion is not to opt for refund at this juncture when your domestic supplies are increasing.

Regards

S.Ramaswamy

[DR.MARIAPPAN GOVINDARAJAN]

You can get refund of SGST or adjust the same in the next payment as advised by Shri Ramasamy.

[Yash Jain]

Dear Sir,

Thanks for guidance.

Now Just on final note, At present my IGST Balance is "Zero", but at the time of Export I had significant IGST Balance.

Now Can I claim IGST Refund from my "SGST Input" .(Reason : As we can offset SGST Liability by IGST Input Or IGST Liability from SGST Input).

The main purpose of Claiming Refund is to convert Input into cash and Save CC Interest, please.

[KASTURI SETHI]

Why you say IGST refund from SGST input specifically ? This is question is not correctly phrased.

[KASTURI SETHI]

Read, "This question is not properly drafted".

[Yash Jain]

Dear Sir,

I Regret for Inconvenience caused if any.

Sir, at Present in My Electronic Credit Ledger I only have SGST Input (My CGST & IGST Input are "zero").

But while making Exports Sir, I had procured Goods by Paying IGST. (At present My IGST Input is "Nil").

Now, In Offset Meachanism, Leaving Set Off of CGST and SGST among themselves, all other combination are permissible i.e Offsetting of

1. IGST Liability (by Way of IGST (First) + CGST (Second) + SGST (Third)) and similarly for

2.CGST Liability (By Input of CGST (First) + IGST (Balance)

3. SGST Liability (SGST (First) + IGST (Balance) ) Input

Hence if the Law Permits to Set off the SGST Liability by way of Input from IGST then why cant We take IGST Refund from SGST Input. This is my question, please guide me

[Praveen Nair]

Dear Yash

As per your query you want to utilize SGST (since CGST & IGST is Nil in your Electronic Credit Ledger) for the payment of IGST on export, and claim refund of IGST. This is fine.

Regards

Pravin

[subramanian vijayakumar]

Yes you can adjust your SGST credit to SGST AND IGST OR YOU CAN CLAOM IT AS REFUND

[KASTURI SETHI]

Undoubtedly, Sir.

[Yash Jain]

Dear Sir,

My Question is - Whether I Can Get Refund for My CGST Portion from My "SGST Input Balance".

At present say I have only SGST Input balance for ₹ 100/-. I don’t have CGST Input Balance and IGST Input Balance.

But while I had done exports, I Had procured the Goods under CGST and IGST say for ₹ 50.

So my Question is that whether from my SGST input of ₹ 100/- can I get Refund of CGST of ₹ 50/- .

The government has issued the Circular No.:349/21/2016-GST Dated 04^th September,2018 were in vide para 3.2 (part b) (Page No.:2)

The abstract of the Circular is as under,

“3.2 After calculating the Least of three amounts, as detailed above, the equivalent amount is to be debited from the Electronic Credit Ledger of the claimant in the following order,;

a. Integrated tax to the extent of Balance Available

b. Central Tax and State Tax/UT Tax equally to the extent of the balance available and in the event of short fall in the balance available in a particular electronic credit ledger (say Central Tax), the differential amount is to be debited from the Electronic Credit Ledger, in this case”

Hence please inform us that whether I can claim CGST Input from my Available SGST Input Balance in Electronic Credit Ledger.

But my question to circular is, if the GST Law in itself does not allow offsetting among SGST & CGST (Rationalization of ITC Utilization) then how can this circular allow the refund of CGST Portion from the SGST Input?

I request at your kind end to please help me.

[Nandan Khambete]

Hello,

No. you cannot claim CGST Refund from SGST balance lying in Credit ledger. Refund under GST is granted of ITC for month vis a vis balance in Credit Ledger after filing return and balance in Credit ledger just before filing refund claim.

Once you have utilised SGST ITC against IGST, it means that portion of SGST ITC has been “consumed” was no balance in IGST at month end. So once ITC is consumed. Taking tefund of same again will be availing double benefit which may attract department.

Hence, you are not eligible to claim CGST or IGST out of SGST balance.

Now whether it is advisable to go for ITC refund ? It depends entirely on facts and figures in your case , so no general advise can be given.

[Yash Jain]

Sir,

Thanks for guidance.

But, as for refund of SGST (From CGST, input) or vice versa, GST circular dated 04.09.2018 (refund clarification), has allowed the same. Please refer para 3.2 (page no. 2) of the notification. As per notification refund of ITC will always be in "equal" Proportion in case of CGST/SGST and deficit if any in either of the ECL balances can be taken from other ECL balances.

This notification seems to be complicated. Please do guide me in view of aforesaid notification.

[Nandan Khambete]

Dear Yash,

That circular is to clear confusion created by format in table 3A. Essence of Circular is Amount of refund will be restricted to SGST Balance in credit ledger after filing return of that particular month. Confusion was because last column in 3A currently shows total refund amount and not Tax wise.

AI Summary

ITC refund limitations: SGST balance cannot be used to claim CGST refund; refund limited by ledger balances. The question is whether an available SGST balance in the electronic credit ledger can be used to obtain refund of CGST or IGST where CGST and IGST balances are nil. SGST cannot be utilised to discharge CGST liabilities, though SGST may be applied against IGST under the offset sequence. Refunds are limited to tax-wise balances in the credit ledger after filing returns, and amounts already consumed by offsets cannot be refunded again; circular guidance clarifies debit order but does not permit claiming CGST refund from SGST beyond ledger limits.