Export refund

[KARAN VERMA]

Sir

In case of export refund RFD-01, shipping bill or Invoice value which is to be taken in Turnover of zero rated supplies column.

[KASTURI SETHI]

FOB value is to be mentioned.

[KARAN VERMA]

Kindly provide any notification or circular for supporting.

[KASTURI SETHI]

I have no circular number. Practically, the department sanctions refund on FOB value. That is the basis of my reply. Also go through all the replies in respect of Issue ID No.115843 dated 2.1.20.

[Ganeshan Kalyani]

Sir, I agree with the view of Sri Kasturi Sir. It is FOB value.

[Amit Agrawal]

Under excise regime, I defended a case where assessee was paying excise duty on 'Selling Price plus Die amortization Cost' against goods exported and claiming refund there-against. Dept. was sanctioning refund claim partially in cash (i.e. duty proportionate to FOB value -which was basic selling price) and balance by way of re-credit (i.e. duty proportionate to Die amortization Cost).

We got favorable ruling from Commissioner (Appeals) granting entire refund in cash on the ground that duty was correctly paid (on value as per valuation rules) and there was no provision in excise-law to back Dept.'s action of granting only partial refund in cash by limiting it to FOB value.

[KASTURI SETHI]

Dear Sir,

Whether the said Order-in-Appeal passed by the Commissioner (Appeals) was accepted by the Department ? If so, it is your great success.

Refund was being sanctioned on the basis of circular. The CE duty paid on the amount of freight, insurance etc. incurred up to the port (emphasis is on up to port) was being sanctioned in Cenvat Credit Account and duty paid on exported goods was being sanctioned in cash. Duty paid on the amount of freight, insurance etc. was considered as excess payment of duty because it had nothing to do with export. Such expenses were incurred up to theport. Most of the case laws were decided in favour of the department for sanction of rebate of duty in cash on the FOB value. The same practice is in force in GST regime also.

[Raghunandhaanan rvi]

During the processing of the refund claim, the value of the goods declared in the GST invoice and the value in the corresponding shipping bill/bill of export should be examined and the lower of the two values should be taken into account while calculating the eligible amount of refund. Please refer to CBIC Circular No. 125/44/2019-GST dated 18.11.2019 (Para 47).

AI Summary

Export refund calculation: use FOB value and the lower of GST invoice or shipping bill to determine eligible refund.
Refunds for zero-rated exports are generally sanctioned on the FOB value; freight and insurance up to the port are treated separately (often as credit). Administrative practice compares the GST invoice value and the shipping bill value and uses the lower of the two to calculate the eligible refund. An excise-era appeal achieved full cash refund on invoiced value including die amortization, but department practice commonly limits cash rebate to FOB with re-credit for other elements.