Refund of accumulated ITC due to supplies @0.1% GST merchant exporters

[MohanLal tiwari]

Dear Panelists,

We are manufacturing & supplying goods to merchant exporters @ 0.1%, Railway parts @5% and others @18%. Due to maximum supplies to merchant exporters and railways, the ITC is getting accumulated day be day.

Kindly advise whether we should claim refund of accumulated ITC on account of supplies to merchant exporters, if so how we can segregate the ITC against ITC taken for manufacturing of export or railway goods if some of the inputs are common for all.

AI Summary

Manufacturing company seeks ITC refund under Section 54 CGST Act due to export-related accumulation. Consult CMA for guidance. A manufacturing company supplying goods to merchant exporters at 0.1% GST, railway parts at 5%, and others at 18% is experiencing accumulated Input Tax Credit (ITC) due to high volumes of exports. They seek advice on claiming refunds for this accumulated ITC, especially when some inputs are common across different products. Responses indicate that refunds can be claimed under the inverted tax structure as per Section 54 of the CGST Act, 2017. Suggestions include consulting a Cost Management Accountant (CMA) for data certification and using a turnover ratio for ITC segregation.