Refund of compensation cess u/r 96 when final product is not chargeable to cess

[Nikhil Virkar]

Dear sirs, ITC is claimed of compensation cess paid on eligible input used for the manufacturing of final product. Compensation cess levy is not applicable to the said final product. If we export the final product on payment of tax to claim the refund of GST u/r 96, how we can claim the refund of accumulated compensation cess attributable to export. Since cess is not levied on final product we cannot pay while filing refund u/r 96 thru shipping bill. Please guide

AI Summary

Refund of Compensation Cess Under GST: Key Insights on Rule 89(4) for Exported Products Without Cess. A discussion on a forum revolves around the refund of compensation cess under GST rules when the final product is not subject to cess. The query raises concerns about claiming a refund for accumulated compensation cess on exported products. Responses suggest referring to specific GST circulars and rules, highlighting that while zero-rated supplies remain zero-rated, claiming a refund under Rule 89(4) is necessary if the final product is not levied with cess. It is noted that if exported on payment of tax, the refund of cess is not feasible unless contested, as the issue may require litigation if the department rejects the refund claim.