IGST Refund on Export product

[Mathi Bharathi]

Dear Sir

We have Imported the raw material by Advance Authorisation for exports.

At that time of Exports we paid the IGST by mistake and refund the same from customs.

Now GST /customs insist to repay the IGST refund under wrong availment under rule 96 (10) of GGST 2017. Please advice that we need refund or not

[Pradeep Reddy Unnathi Partners]

Hi,

IGST refund should be repaid to the Customs authorities along with interest as the exporter of goods (who used AA scheme is not eligible for IGST refund)

[KASTURI SETHI]

Dear querist,

After thorough study of "Advance Authorisation" in Foreign Trade Policy and Procedure of refund claim in CGST Act read with IGST Act and CGST Rules and Customs Act, I am of the view that this issue is worth fighting. 'Advance Authorization' and Rule 96 (10) of CGST Rules are not an hindrance here.. IGST was paid which was not required to be paid. Hence such refund claim falls in the category of "excess payment of IGST by mistake". In other words, "Any Other Category"

This is altogether different refund claim wherein Rule 96(10) cannot create bottleneck. In order to get fair justice and relief, you require penetrative study of all the relevant notifications in this context. Too much hard work is required indeed.

It is worthwhile to mention that sometimes SCNs are issued to save one's skin.

[Shilpi Jain]

You could also consider paying IGST on the imported goods. Though this will also be with interest.

Another way is to challenge the rule 96(10) itself

[Shilpi Jain]

This provision is already under challenge is certain courts

AI Summary

IGST refund dispute: exporter under Advance Authorization may face repayment demand or challenge on excess payment grounds. Dispute concerns repayment of an IGST refund where an exporter using Advance Authorization mistakenly paid IGST and received a customs refund, while authorities allege wrong availment under refund rules. One position recommends repaying IGST with interest as Advance Authorization holders are ineligible; another treats the payment as an excess payment made by mistake falling into a separate refund category and argues the specific refund-rule objection should not bar relief, suggesting review of notifications or legal challenge as alternatives.