Dear experts. Need your help with the following query-
A company having aggregate turnover less than ₹ 20 lakhs in the previous year availed some service from a govt. department (exempt vide S. No. 7 of Notification no. 12/2017 CT-R).
The company being unaware of this provision, deposited RCM on such supply in the relevant GSTR-3B and has no other taxable outward supplies (being an electricity distribution company). Is it possible to claim refund in this case?
Company Seeks Refund for Mistaken RCM Tax Payment; Cites Section 54 (8)(e) of CGST Act and Legal Precedents A company with a turnover below 20 lakhs mistakenly paid tax under the Reverse Charge Mechanism (RCM) for services exempt under Notification no. 12/2017 CT-R. Experts advised that a refund is possible under Section 54 (8)(e) of the CGST Act, provided it is claimed within two years. The company faced informal rejection from tax authorities, prompting an appeal. Legal precedents and constitutional articles were cited to argue that the tax paid was a deposit, not a tax, thus not subject to time limits. The exemption applies to registered entities with low turnover, supporting the refund claim. (AI Summary)
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