GST refund- Adjusted total turnover

[Hariharan Sundaram]

Dear Experts kindly clarify the adjusted total turnover as mentioned under Rule 89(4)(E) as per which,

E) “Adjusted Total Turnover” means the sum total of the value of-

(a) the turnover in a State or a Union territory, as defined under clause (112) of section 2,excluding the turnover of services; and

(b) the turnover of zero-rated supply of services determined in terms of clause (D) above and non-zero-rated supply of services,

excluding-

(i) the value of exempt supplies other than zero-rated supplies; and

(ii) the turnover of supplies in respect of which refund is claimed under sub-rule (4A) or sub-rule (4B) or both, if any,

during the relevant period

Further as per the definition of turnover in state defined Section 2 (112) of CGST Act, 2017,

“turnover in State” or “turnover in Union territory” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis) and exempt supplies made within a State or Union territory by a taxable person, exports of goods or services or both and inter-State supplies of goods or services or both made from the State or Union territory by the said taxable person but excludes central tax, State tax, Union territory tax, integrated tax and cess;

My question is whether the value of inter state supply of Services , has to be included or not in the adjusted total turnover for claiming refund since turnover of services are specifically excluded in the main part of the 'Adjusted total turnover' as per Rule 89(4)(E) of the CGST Rules, 2017? Kindly guide me sirs.

[Rajagopalan Ranganathan]

Sir,

According to Rule 89 (4) (E) (b) of CGST Rules, 2017 “Adjusted Total Turnover” means the sum total of the value of the turnover of zero-rated supply of services determined in terms of clause (D) above and non-zero-rated supply of services. Therefore value of zero-rated supply of services and non-zero rated supply of service are liable to be taken into account for calculating “Adjusted Total Turnover”.

AI Summary

Adjusted Total Turnover: include zero rated and non zero rated service supplies when computing refund eligibility. Whether inter State supplies of services are included in adjusted total turnover for refunds is answered by noting that Rule 89(4)(E)(b) requires inclusion of the value of zero rated and non zero rated supplies of services; therefore such service supplies must be taken into account when computing adjusted total turnover for refund claims.