SIMULTANEOUS CLAIMS OF REFUND OF GST DUE TO EXPORT UNDER LUT AND INVRETED DUTY STRUCTURE

[KULJIT SINGH]

Is it it possible for a manufacturer making domestic as well as export sales, where inverted duty structure is applicable, to claim simultaneous refund on account of exports under LUT and inverted duty structure or that only one of above can be claimed. If yes whether any specific provision permits so.

[Rajagopalan Ranganathan]

Sir,

When you claim a refund of tax (CGST, SGST or IGST) paid on the inputs and capital goods used for the manufacture of export goods, it covers the actual credit taken by you. Therefore you cannot claim a refund due to the inverted duty structure again in respect of the same inputs and capital goods. The credit already taken by you is higher than the tax payable on exported goods due to inverted duty structure and this credit is claimed as refund by you due to export of goods under LUT without payment of IGST on the export goods.

AI Summary

Export input tax refund precludes a separate inverted duty structure refund for the same inputs used in exports. Refund of tax paid on inputs and capital goods used in manufacture of exported goods covers the actual input tax credit claimed; therefore a supplier cannot claim a separate refund on account of the inverted duty structure for the same inputs and capital goods where those credits have already been claimed as refund due to exports under LUT without payment of IGST.