A pharmaceutical company is applying refund under GST for inverted duty. The company also has some sales of raw material “as it is” treating it as trading sales. These trading sales are not covered under inverted duty as per law.
Please let us know how to compute refund in this case :
1. Whether we have to deduct trading sale from adjusted total turnover and inverted structure sale both as per the formulae provided.
2. or We continue to include trading sales in both inverted and total adjusted turnover (ignore trading effect of sale).
Note : here trading of raw material and sales of manufactured goods both are chargeable to 12%.
Pharma company challenges GST refund calculation, questions inclusion of trading sales in adjusted turnover and inverted structure sales. A pharmaceutical company is seeking a GST refund for inverted duty and is questioning whether trading sales of raw materials should be deducted from the adjusted total turnover and inverted structure sales when calculating the refund. The trading sales are not covered under inverted duty. The company is unsure whether to exclude trading sales from calculations or include them in both inverted and total adjusted turnover. A response notes that there is inconsistency in how the department handles this, leading to reduced refund amounts. Both trading and manufactured goods sales are subject to a 12% charge. (AI Summary)
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