Is amendment in time limit for refund under sec 54 retrospective

[Kishore Dintakurthi]

One of my clients refund application (Inverted duty structure) was rejected on the ground that it is time barred.

Central Goods & Service Tax Amendment Act, 2018 has substituted the clause (e) of 2nd Explanation to Section 54 of the CGST Act, 2017, w.e.f. 01 .02.2019, which defines the relevant date for filling application for refund of unutilized input tax credit

The said clause prior to its substitution read as hereunder:

(e) in the case of refund of unutilized input tax credit under sub-section (3), the end of the financial year in which such claim for refund arises

“Whereas w.e.f. 01.02.2019, CGST Amendment Act, 2018 has substituted the above said clause with the clause reproduced as hereunder:

“(e) in the case of refund of unutilized input tax credit under clause (ii) of the first proviso to sub-section (3), the due date for furnishing of return under section 39 for the period in which such claim for refund arises.”

Now, the basic question that is whether the substituted clause will have application only in relation to refund application filled for the tax period reckoning from the February, 2019 onwards or will also hit the refund application filled after the date 01.02.2019 even pertaining to the tax period(s) prior to February, 2019.

Please give your valuable views

AI Summary

Amendment to refund time limit may apply to refund claims filed on or after effective date, affecting prior tax periods.
Whether the substituted clause in Explanation 2(e) to Section 54 - which sets the relevant date for refund of unutilized input tax credit as the due date for furnishing the return for the period in which the claim arises - applies to refund claims filed on or after the amendment's effective date even where the tax period predates the amendment is contested; opinions in the discussion split between treating the change as applying to all claims filed on or after the effective date and treating it as prospective so pre-amendment refunds remain governed by the erstwhile explanation.