Refund of gst

[RAJINDER SAREEN]

Some trader paid gst on import of salt at Mundra port in Feb.,2019. The customs charged GST thereon. Can the trader claim refund of GST as the burden of GST was not shifted while selling the same in India?

[KASTURI SETHI]

Refund on the ground that you have not passed on the burden of tax to the consumer/buyer cannot be claimed.

[RAJINDER SAREEN]

But Sir, salt attracts nil rate of GST. But customs has charged GST for no reason except for defective system. Can't the refund of the same be claimed?

[RAJINDER SAREEN]

Sethi ji, can't refund of GST be claimed as salt attracts nil GST.

[KASTURI SETHI]

If duty is paid without any authority of law or collected by the department with out any authority of law, it is unconstitutional action and refund is admissible. Ensure that salt does not attract duty. As you have mentioned that you have not passed on the burden of duty to the buyer, it means you have paid duty out of your pocket and refund claim shall not be hit by the principles of unjust enrichment.

[RAJINDER SAREEN]

Sethi ji, thanks.

[RAJINDER SAREEN]

Will the refund of amount unconstitutionally collected by the department be hit by time limitation ?

[KASTURI SETHI]

Not at all. There is a case law on this issue in your favour.

[KASTURI SETHI]

Tax or duty collected unconstitutionally does not conform to the definition of tax or duty. It is an amount. Hence time bar limitation not applicable.

[YAGAY andSUN]

Since Salt is Exempted in GST Regime, therefore, charging or paying it inadvertently, will not make it bar by limitation. We duly endorse the views of Sethi Sir.

AI Summary

Trader Seeks GST Refund on Salt Imports; Expert Confirms Unconstitutional Collection Allows Refund Without Time Limit A trader paid GST on salt imports at Mundra port in February 2019, despite salt attracting a nil GST rate. The trader inquired about claiming a refund since the GST burden was not transferred to buyers. An expert clarified that refunds are possible if the duty was collected without legal authority, as it is deemed unconstitutional. Such refunds are not subject to time limitations, as the amount collected does not qualify as tax or duty. Another participant supported this view, emphasizing that GST on salt, being exempt, does not encounter time bar issues when claimed for a refund.