Section 54 r w r 96A belated realisation - Reg.

[Raam Srinivasan Swaminathan Kalpathi]

We had exported engineering services under LUT and invoiced the client for $25000/- in March 2024. After remitting $15000/- the client expressed inability to settle the balance amount of $10000/-. The same was written off in the books as bad debts and we dutifully remitted GST @18% with appropriate interest u/s. 50 as provided in Rule 96A through DRC-03 challan for the unsettled amount of $10000/- in October 2024. The said client had today wired the balance amount of $10000/- and we have secured the FIRC.

The query is, can I claim refund of the amount remitted through DRC-03 or would it be appropriate to avail credit of the same in GSTR-3B in this month's return? Kindly clarify. Thanks

AI Summary

Forum Seeks Advice on GST Adjustment for Settled Debt: Refund or Return Adjustment? Expert Opinions Differ. A participant in a discussion forum sought advice on handling a GST issue after a client settled a previously written-off debt. The participant had exported services and paid GST on an unpaid amount, which was later settled. They asked whether to claim a refund or adjust the GST in their return. Responses varied: one suggested checking a specific circular and considering adjustments in future returns; another recommended claiming a refund as the safer option; and a third advised considering both options, emphasizing the refund process. The participant expressed gratitude for the insights provided.