TaxTMI 
TaxTMI 
Refund issue
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....efund issue<br> Query (Issue) Started By: - Sudipta Dey Dated:- 6-6-2025 Last Reply Date:- 9-6-2025 Goods and Services Tax - GST<br>Got 8 Replies<br>GST<br>Sir, some taxpayer violates the provision of section 49 of CGST Act'17 read with rule 86B of CGST rules by way of paying full tax liability by ITC and then Audit team catches the issue and ask the taxpayer to pay the liability of GST by ca....
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....sh along with interest and penalty. Will the taxpayer be eligible for refund of the ITC that has been previously used to discharge his tax liability because double payment of tax happening here? What is the process of applying for such refund? Reply By KASTURI SETHI: The Reply: In such scenario, refund is allowed under the category of "Excess Payment". Normal procedure is to be followed. Apply i....
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....n Form GST RFD-01 on Common Portal System and also submit physical copy in the jurisdictional CGST Division Office. Section 54 (8) (e) is relevant. Reply By Shilpi Jain: The Reply: Rule 86B is held to be ultra vires in the case of AM Enterprises - 2024 (9) TMI 1485 - HIMACHAL PRADESH HIGH COURT Reply By KASTURI SETHI: The Reply: Relevant Extract of the judgement of H.P. High Co....
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....urt Shimla in the case of A.M. ENTERPRISES Versus STATE OF HIMACHAL PRADESH- 2024 (9) TMI 1485 - HIMACHAL PRADESH HIGH COURT "25. We do find force in the petitioner's contention that Rule 86B of the Act has no statutory backing and appears to be ultra vires the provisions of the HPGST Act, 2017. 26. But we need not base our decision on the said issue." Reply By Shilpi Jain: The Reply: In spite....
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.... of the Court not having passed the order on the basis that the said rule in ultra vires, that does not negate the fact that the Court has held it is ultra vires. This can be taken up in case of litigation (if you wish to litigate if the amount is sizable and considering your risk appetite) In case you do not wish to litigate, make an intimation to the department that you are taking back the cre....
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....dit and paying the liability in cash. Make suitable disclosures in the returns. Refund again could get litigated by the department. Reply By Sudipta Dey: The Reply: Madam, Payment of tax by ITC was done in 2022-23 and now the case of violation of rule 86B has arrived. Now how is it possible to take back the ITC and pay the tax by cash? What is the actual procedure? Reply By KASTURI SETHI....
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....: The Reply: Tax has to be paid in cash and seek refund of ITC paid wrongly. Any rule will remain in force until it is omitted. Rule 86 B is in force. It has to be followed. Reply By Ganeshan Kalyani: The Reply: The liability paid through Cash now would mean the ITC which was adjusted previously got reversed Once availed and reversed later the re-availment of said ITC has not timeli....
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....ne. So, you may take back the ITC so reversed in current month GSTR-3B. Reply By KASTURI SETHI: The Reply: It is a fact that there is no time limit for re-credit. In this scenario, re-credit cannot be taken on ones own. Application for refund claim has to be filed and Adjudication Order has to be passed by the Proper Officer. See Para No.4 (4.1, 4.2, 4.3.1 & 4.3.2 ) of C.B.I. &....
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.... C. Circular No. 135/05/2020-GST, dated 31-3-2020 as amended.. Relevant Rules are mentioned therein.<br> Discussion Forum - Knowledge Sharing ....