GST paid under protest on imports

[Kaustubh Karandikar]

XYZ imported goods and paid the IGST @ 12% but “STRICTLY UNDER PROTEST” since in their view as per the GST Tariff the rate applicable is IGST @ 5%. The IGST of 12% so paid on imports, they claimed full input tax credit of the same. However, while re – selling these goods in the domestic market i.e., trading activity, they charged GST @ 5% in the Tax Invoice which according to them is the correct GST rate. Will this create any problem for XYZ?

AI Summary

XYZ Challenges 12% IGST on Imports, Claims 5% Correct Rate; Considers Refunds & Future Payment Implications XYZ imported goods and paid IGST at 12% under protest, believing the correct rate to be 5%. They claimed full input tax credit but charged 5% GST when reselling domestically. Concerns were raised about the lack of provision for paying GST under protest and potential issues with availing credit until disputes are settled. Some suggested exploring refund options under the inverted duty structure. A reference was made to a High Court decision supporting payment under protest, and it was noted that IGST could be paid under protest under Customs Laws. There may be future implications for differential payments.