Inverted Duty Structure Refund

[Ranjith Reddy]

Provision

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

Situation

However in our situation there are outward supplies (Rates 5,12,18,28) and inward supplies (Rates 5,12,18,28) which are taxed at multiple rate of taxes and also the output liability is less than inputs(ITC).

Question

Kindly advise in my case the refund under inverted duty structure is valid?

AI Summary

Manufacturer Seeks Tax Refund Under Section 54(3)(ii) of CGST Act Due to Inverted Duty Structure on Inputs An individual inquired about eligibility for a refund under the inverted duty structure due to higher tax rates on inputs compared to outputs. The discussion revealed that the individual is a manufacturer of tractor and tiller products, not a composite dealer. A respondent clarified that under Section 54(3)(ii) of the CGST Act, a refund is possible if it can be demonstrated that some goods were taxed at a lower rate due to multiple tax rates. Another participant confirmed eligibility for the refund, referencing a specific GST circular for further guidance.