GST | Refund or Adjustment of Tax Paid Pursuant to Favourable Advance Ruling

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ST | Refund or Adjustment of Tax Paid Pursuant to Favourable Advance Ruling<br> Query (Issue) Started By: - Abhijeet Mane Dated:- 10-8-2026 Last Reply Date:- 23-8-2026 Goods and Services Tax - GST<br>Got 2 Replies<br>GST<br>If an assessee has paid GST on a transaction for past periods and subsequently obtains a favourable AAR/AAAR holding that the transaction is exempt/not taxable, whether the ass....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....essee need to mandatory refund of GST already paid for prior periods? Or, whether the tax already paid be adjusted through GSTR-3B or is refund under Section 54 the only remedy? Reply By Sanjeev Agarwal: The Reply: A favourable AAR/AAAR does not, by itself, require the assessee to refund or reverse GST already paid for past periods. However, if the assessee seeks recovery of such GST on th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e basis that the transaction was exempt/non-taxable, the normal statutory remedy is a refund claim under Section 54, subject to limitation and unjust-enrichment requirements. The assessee should not ordinarily adjust the historical GST merely by reducing its liability in a subsequent GSTR-3B. Such adjustment cannot be treated as a general substitute for the statutory refund mechanism, particula....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rly in view of the Supreme Court&#39;s decision in Bharti Airtel on rectification of GSTR-3B. Where the Section 54 limitation has expired, a separate examination is required as to whether the amount was collected/retained without authority of law and whether an Article 265/writ remedy is available. This is fact- and jurisdiction-sensitive. Reply By Shilpi Jain: The Reply: Refund is eligibl....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e if the time limit u/s 54 of 2 years has not lapsed. Ruling of AAR is binding meaning that for the transaction that is ongoing and which was existing in the past (without any change in facts/circumstances) the same conclusion as in the ruling applies.<br> Discussion Forum - Knowledge Sharing ....