Export sales return and re -export

[Sooraj B]

An exporter exported goods on payment of IGST and received refund of the IGST paid. However, subsequent to the export, the goods were returned back to India by the customer due to quality issues. The exporter cleared the goods without payment of import duty under the re-export option by furnishing a bond and then re-exported the goods under LUT. In the meanwhile, the exporter paid back through DRC-03, the IGST refund received, as he thought that since the goods were sent back, he had to pay back the IGST refund received. Was the exporter right in paying back the IGST refund received ? Can the exporter now apply for refund of the IGST paid through DRC-03? Kindly share your views .

AI Summary

Exporter Correctly Repays IGST After Re-export Under LUT; Eligible for Unutilized ITC Refund and Future Adjustments. An exporter who initially received a refund of IGST after exporting goods faced a situation where the goods were returned due to quality issues. The exporter re-exported the goods under a Letter of Undertaking (LUT) without paying import duty, and repaid the IGST refund via DRC-03, believing it was necessary. Experts in the discussion agreed the repayment was correct and that the exporter is not entitled to reclaim the IGST paid back. However, the exporter is eligible to claim a refund of unutilized Input Tax Credit (ITC) and may adjust the ITC for future exports or domestic supplies. Interest on the repaid IGST may also apply.