Circular No.
17/17/2017 - GST
Sub – Manual filing and processing of refund claims in
respect of zero-rated supplies - reg.
Due to the non-availability of the
refund module on the common portal, it has been decided by the competent
authority, on the recommendations of the Council, that the
applications/documents/forms pertaining to refund claims on account of
zero-rated supplies shall be filed and processed manually till further orders.
Therefore, in exercise of the powers conferred by sub-section (1) of section
168 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as
‘the CGST Act’) and for the purpose of ensuring uniformity, the following
conditions and procedure are laid down for the manual filing and processing of
the refund claims:
2.1 As per sub-section (3) of section 16 of
the Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as
‘the IGST Act’) read with clause (i) of subsection (3) and sub-section (6) of
section 54 of the CGST Act and rules 89 to 96A of the Central Goods and
Services Tax Rules, 2017 (hereinafter referred to as ‘the CGST Rules’), a
registered person may make zero-rated supplies of goods or services or both on
payment of integrated tax and claim refund of the tax so paid, or make
zero-rated supplies of goods or services or both under bond or Letter of
Undertaking without payment of integrated tax and claim refund of unutilized
input tax credit in relation to such zero rated supplies.
2.2 The refund of integrated tax paid on
goods exported out of India is governed by rule 96 of the CGST Rules. The
shipping bill filed by an exporter shall be deemed to be an application for
refund in such cases. The application shall be deemed to have been filed only
when export manifest or export report is filed and the applicant has furnished
a valid return in FORM GSTR-3 or FORM GSTR-3B, as the case may be. Upon
receipt of the information regarding furnishing of a valid return in FORM GSTR-3 or FORM GSTR-3B, as the case may be, from the common portal, the
system designated by the Customs shall process the claim for refund and an
amount equal to the integrated tax paid in respect of such export shall be
electronically credited to the bank account of the applicant. Any order
regarding withholding of such refund or its further sanction respectively in
PART-B of FORM GST RFD-07 or FORM GST RFD-06 shall be done manually
till the refund module is operational on the common portal.
2.3 The application for refund of integrated
tax paid on zero-rated supply of goods to a Special Economic Zone developer or
a Special Economic Zone unit or in case of zero-rated supply of services (that
is, except the cases covered in paragraph 2.2 above and para 2.4 below) is
required to be filed in FORM GST RFD-01A
(as notified in the CGST Rules vide notification No. 55/2017 – Central Tax
dated 15.11.2017) by the supplier on
the common portal and a print out of the said form shall be submitted before
the jurisdictional proper officer along with all necessary documentary
evidences as applicable (as per the details in statement 2 or 4 of Annexure to FORM GST RFD – 01), within the time
stipulated for filing of such refund under the CGST Act.
2.4 The application for refund of unutilized
input tax credit on inputs or input services used in making such zero-rated
supplies shall be filed in FORM GST
RFD01A on the common portal and the amount claimed as refund shall get
debited in accordance with sub-rule (3) of rule 86 of the CGST Rules from the amount in the electronic
credit ledger to the extent of the claim. The common portal shall generate a
proof of debit (ARN- Acknowledgement Receipt Number) which would be mentioned
in the FORM GST RFD-01A submitted
manually, along with the print out of FORM
GST RFD-01A to the jurisdictional proper officer, and with all necessary
documentary evidences as applicable (as per details in statement 3 or 5 of
Annexure to FORM GST RFD-01), within
the time stipulated for filing of such refund under the CGST Act.
2.5 The registered person needs to file the
refund claim with the jurisdictional tax authority to which the taxpayer has
been assigned as per the administrative order issued in this regard by the
Chief Commissioner of Central Tax and the Commissioner of State Tax. In case
such an order has not been issued in the State, the registered person is at
liberty to apply for refund before the Central Tax Authority or State Tax
Authority till the administrative mechanism for assigning of taxpayers to
respective authority is implemented. However, in the latter case, an
undertaking is required to be submitted stating that the claim for sanction of
refund has been made to only one of the authorities. It is reiterated that the
Central Tax officers shall facilitate the processing of the refund claims of
all registered persons whether or not such person was registered with the
Central Government in the earlier regime.
2.6 Once such a refund application in FORM GST RFD-01A is received in the
office of the jurisdictional proper officer,
an entry shall be made in a refund register to be maintained for this purpose
with the following details –Table 1
|
Sl.
No
.
|
Applicant’s
name
|
GSTIN
|
Date
of receipt of application
|
Period
to
which
the claim pertains
|
Nature
of refund – Refund of integrated tax paid/Refund of unutilized
ITC
|
Amount
of refund claimed
|
Date
of issue of acknowledgment
in FORM
GST
RFD-02
|
Date
of receipt of complete application
(as
mentioned in FORM GST
RFD-02)
|
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
2.7 Further, all communication in regard to
the FORMS mentioned below shall be done manually, within the timelines as
specified in the relevant rules, till the module is operational on the common
portal, and all such communications shall also be recorded appropriately in the
refund register as discussed in the succeeding paragraphs –
|
Sl.
No.
|
FORM
|
Details
|
Relevant provision of the CGST
Rules, 2017
|
|
1.
|
FORM
GST RFD-02
|
Acknowledgement
|
Rules 90(1)
and 90(2)
|
|
2.
|
FORM
GST RFD-03
|
Deficiency
memo
|
Rule
90(3)
|
|
3.
|
FORM
GST RFD-04
|
Provisional
refund order
|
Rule
91(2)
|
|
4.
|
FORM
GST RFD-05
|
Payment
advice
|
Rules
91(3),
92(4),
92(5) and 94
|
|
5.
|
FORM
GST RFD-06
|
Refund
sanction/ Rejection order
|
Rules
92(1),
92(3),
92(4),
92(5)
and 96(7)
|
|
6.
|
FORM
GST RFD-07
|
Order for complete adjustment/withholding
of sanctioned refund
|
Rules 92(1), 92(2) and 96(6)
|
|
7.
|
FORM
GST RFD-08
|
Notice
for rejection of
application
for refund
|
Rule
92(3)
|
|
8.
|
FORM
GST RFD-09
|
Reply
to show cause notice
|
Rule
92(3)
|
2.8 The processing of the claim till the
provisional sanction of refund shall be recorded in the refund register as in
the table indicated below -Table 2
|
Date of issue of Deficiency
Memo in
FORM
GST
RFD-03
|
Date
of
Receipt
of reply from the applicant
|
Date of issue of provisional refund order
in FORM GST-RFD-04
|
Amount
of
refund claimed
|
Amount of provisional
refund sanctioned
|
Date
of issue of Payment Advice in FORM GST RFD-05
|
|||
|
|
|
|
|
CT
|
ST/UTT
|
IT
|
Cess
|
|
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
2.9 After the sanction of provisional refund,
the claim shall be processed and the final order issued within sixty days of
the date of receipt of the complete application form. The process shall be
recorded in the refund register as in the table indicated below -Table 3
|
Date
of issue of
notice,
if any for
rejection
of refund in
FORM GST
RFD-
08
|
Date
of receipt pt of reply, if any to
SCN
in
FORM GST
RFD-
09
|
Date
of issue of Refund sanction/ rejection order in
FORM
GST
RFD-06
|
Total
amount of
refund sanctioned
|
Date
of issue of
Payment
Advice
in
FORM
GST
RFD-05
|
Amount of refund
rejected
|
Date
of issue of order
for
adjustment of sanction
ed refund/ withholding refund in
FORM
GST
RFD-07
|
||||||
|
|
|
|
CT
|
ST/UTT
|
I T
|
Cess
|
|
C
T
|
ST/UT
T
|
IT
|
Cess
|
|
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
13
|
2.10 After the refund claim is processed in
accordance with the provisions of the CGST Act and the rules made thereunder
and where any amount claimed as refund is rejected under rule 92 of the CGST
Rules, either fully or partly, the amount debited, to the extent of rejection,
shall be re-credited to the electronic credit ledger by an order made in FORM GST PMT-03. The amount would be
credited by the proper officer using FORM
GST RFD-01B (as notified in the CGST Rules vide notification No. 55/2017 –
Central Tax dated 15.11.2017) subject
to the provisions of rule 93 of the CGST Rules.
3. For the sake of clarity and uniformity,
the entire process of filing and processing of refunds manually is tabulated as
below:
3.1 Filing of Refund Claims:
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Sl.
No.
|
Category of Refund
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Process of Filing
|
|
1.
|
Refund
of IGST paid on export of goods
|
No
separate application is required as shipping bill itself will be treated as
application for refund.
|
|
2.
|
Refund
of IGST paid on export of services / zero rated supplies to SEZ units or SEZ
developers
|
Printout
of FORM GST RFD01A needs to be
filed manually with the jurisdictional GST officer (only at one place -
Centre or State) along with relevant documentary evidences, wherever
applicable.
|
|
3.
|
Refund of unutilized input tax credit due
to the accumulation of credit of tax paid on inputs or input services used in
making zero-rated supplies of goods or services or both
|
FORM
GST RFD-01A needs to be filed on the common portal.
The amount of credit claimed as refund would be debited in the electronic credit ledger and
proof of debit needs to be generated on the common portal. Printout of the
|
|
|
|
FORM
GST RFD- 01A needs to be submitted before the
jurisdictional GST officer along with necessary documentary evidences,
wherever applicable.
|
3.2 Steps to be followed for processing of Refund Claims:
Three different refund registers are to be
maintained for record keeping of the manually sanctioned refunds – for
receipts, sanction of provisional refunds and sanction of final refunds. The
steps are as follows:
|
Step
No.
|
Action to be Taken
|
|
Step-1
|
Entry
to be made in the Refund register for receipt of refund applications
|
|
Step-2
|
Check
for completeness of application as well as availability of the supporting
documents in totality. Once completeness in all respects is ascertained,
acknowledgement in FORM GST RFD-02
shall be issued within 15 days from the date of filing of the application
and entry shall be made in the Refund
register for receipt of refund applications
|
|
Step-3
|
•
All communications (issuance of
deficiency memo, issuance of provisional and final refund orders, payment
advice etc.) shall be done in the format prescribed in the Forms appended to
the CGST Rules, and shall be done manually (i.e. not on the common portal)
within the timelines prescribed in the rules;
•
Processing for grant of provisional
refund shall be completed within 7 days as per the CGST Rules and details to
be maintained in the register for provisional refunds. Bifurcation of the
taxes to be refunded under CGST (CT) /SGST (ST) /UTGST (UT) /IGST (IT) /Cess
shall be maintained in the register mandatorily;
•
After the sanction of the provisional
refund, final order is to be issued within sixty days (after due verification
of the documentary evidences) of the date of receipt of the complete
application form. The details of the finally sanctioned refund and rejected
portion of the refund along with the breakup (CT / ST / UT / IT/ Cess) to be
maintained in the final refund register;
•
The amount not sanctioned and eligible
for re-credit is to be recredited to the electronic credit ledger by an order
made in FORM GST PMT-03. The
actual credit of this amount will be done by the proper officer in FORM GST RFD-01B.
|
3.3 Detailed procedure for manual processing of refund
claims:
The detailed procedure for disposal of Refund
claims filed manually is as under:
|
MANUAL PROCESSING OF REFUND
|
|||
|
STEPS
|
REMARKS
|
LEGAL
PROVISIONS
|
|
|
Filing of refund application in FORM GST RFD- 01A online on the
common portal (only when refund of unutilized ITC is claimed)
|
The
corresponding electronic credit ledger of CT / ST / UT / IT/ Cess would get
debited and an ARN number would get generated.
|
Rule
89
|
|
|
Filing of printout of FORMGST RFD-01A
|
The
printout of the ARN along with application of refund shall be submitted
manually in the appropriate jurisdiction.
This
form needs to be accompanied with the requisite documentary evidences. This
Form shall contain the debit entry in the electronic credit ledger of the
amount claimed as refund in FORM GST
RFD-01A.
|
Rule 89(1)
Application
Rule
89(2)
Rule
89(3)
Debiting
electronic
credit
ledger
|
–
–
–
-
|
|
Initial
scrutiny of the Documents by the proper
officer
|
The proper officer shall validate the GSTIN
details on the portal to validate whether return in FORM GSTR-3 or FORM GSTR-
3B, as the case may be, has been filed. A declaration is required to be
submitted by the claimant that no refund has been claimed against the
relevant invoices.
Deficiencies,
if any, in documentary evidences are to be ascertained and communicated in
|
Rule
90(2) – 15 day time for scrutiny
Rule 90(3) – Issuance of
Deficiency
memo
Rule
90(3) – Fresh refund application requirement
Rule
93(1) – re credit of refund amount applied for
|
|
|
|
FORM GST RFD-03
within 15 days of filing of the refund
application.
|
|
|
|
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Deficiency Memo
should be complete in all respects and only one Deficiency Memo shall be
given.
|
|
|
|
|
Submission
of application after Deficiency Memo shall be treated as a
fresh application.
|
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Resubmission
of the application, after rectifying the deficiencies pointed out in the
Deficiency memo, shall be made by using the ARN and debit entry number
generated originally.
|
|
|
|
|
If
the application is not filed afresh within thirty days of the communication
of the deficiency memo, the proper officer shall pass an order in FORM GST PMT-03 and re-credit the
amount claimed as refund through FORM
GST RFD-01B.
|
|
|
|
Issue
acknowledgement manually within 15 days in FORM GST RFD-02
|
The
date of submission of application for which acknowledgement has been given
will be considered as the date for ensuring whether the refund application
has been sanctioned within the stipulated time period.
|
Rule 90(2)
-
Acknowledgement
|
|
|
Grant
of provisional refund within seven days of issue of acknowledgement
|
The amount of provisional refund shall be
calculated taking into account the total input tax credit, without making any
reduction for credit being provisionally accepted.
Provisional
refund shall be granted separately for each head CT / ST / UT / IT/ Cess
within 7 days of acknowledgement in FORM
GST RFD-04.
Before
sanction of the refund a declaration shall be obtained that the applicant has
not contravened rule 91(1). Payment advice to be issued in FORM GST RFD-05.
Refund would be made directly in the bank
account mentioned in the registration.
|
Rule 91(1)
–
Requirement of no prosecution for last
5 years
Rule 91(2) – Prima facie satisfaction,
seven day
requirement
Rule 91(3) – Payment advice, electronic
credit to bank account
|
|
|
Detailed
scrutiny of the refund application along with submitted documents
|
The officer shall validate refund statement
details with details in FORM GSTR 1
(or Table 6A of
FORM
GSTR-1) available on the common portal.
The Shipping bill details shall be checked
by officer through ICEGATE SITE
(www.icegate.gov.in) wherein the officer would be able to
check details of EGM and shipping bill by keying in port name, Shipping bill
number and date.
Further, details of IGST paid also needs to
be
|
Rule 89(4) – Refund
Amount Calculation
Rule 92(1) – Any adjustments made in the
amount against existing demands
Rule 92(2) – reasons for withholding of
refunds
|
|
|
|
verified from FORM GSTR- 3 or FORM
GSTR-
3B,
as the case may be, filed by the applicant and it needs to be verified that
the refund amount claimed shall be less than the tax paid on account of zero
rated supplies as per
FORM
GSTR-3 or FORM GSTR-
3B, as the case may be.
|
|
|
|
|
Ascertain what amount may be sanctioned
finally and see whether any adjustments against any outstanding liability is
required (FORM
GST
RFD-07 – Part A).
|
|
|
|
|
Ascertain what amount of the input tax
credit is sanction-able, and amount of refund, if any, liable to be withheld.
|
|
|
|
|
Order needs to be passed in FORM GST RFD-07
– Part B.
|
|
|
|
If
the sanction-able amount is less than the applied amount
|
Notice has to be issued to the applicant
in FORM GST RFD-08. The applicant has to reply within 15 days of
receipt of the notice in
FORM
GST RFD-09. Principles of natural justice to be
followed before making the final decision.
Final order to be made
in FORM
GST RFD-
06.
|
Rule 92(3) – Notice for refund not
admissible / payable
Rule 92(3) – Requirement of reply to the
notice
within 15 days
Rule 92(3), 92(4), 92(5) – Sanction of
Refund order
|
|
|
Pre-Audit
|
Pre-audit of the manually processed refund
applications is not required to be
|
|
|
|
|
carried out, irrespective of the amount
involved, till separate detailed guidelines are issued.
|
|
|
|
|
Post-audit of the orders may however
continue on the basis of extant guidelines.
|
|
|
|
Final sanction of refund
|
The proper officer shall issue the refund
order manually for each head i.e. CT / ST / UT / IT/ Cess.
Amount paid provisionally needs to be
adjusted accordingly.
Payment advice is to be made in FORM GST
RFD-05.
The amount of credit rejected has to be re credited
to the credit ledger by an order in FORM
GST PMT- 03 and shall be intimated to the common portal in FORM GST RFD-01B.
Refund, if any, will be paid by an order
with payment advice in FORM GST RFD-05.
The details of the refund along with
taxpayer bank account details shall be manually submitted in
PFMS/[States’] system by the jurisdictional
Division’s DDO and a signed copy of the sanction order shall be sent to PAO
office for release of payment.
|
Rule 92(3), 92(4), 92(5) – Sanction of
Refund order
Rule 92(4), 92(5) –
Payment advice
issue
|
|
|
Payment of interest if any
|
Amount, if any, will be paid by an order
with payment advice in FORM GST RFD-05.
|
Rule 94
|
|
4.
The refund application for various taxes i.e.
CT / ST / UT / IT/ Cess can be filed with any one of the tax authorities and
shall be processed by the said authority, however the payment of the sanctioned
refund amount shall be made only by the respective tax authority of the Centre
or State government. In other words, the payment of the sanctioned refund
amount in relation to CT / IT / Cess shall be made by the Central tax authority
while payment of the sanctioned refund amount in relation to ST / UT would be
made by the State tax/Union territory tax authority. It therefore becomes
necessary that the refund order issued either by the Central tax authority or
the State tax/UT tax authority is communicated to the concerned counter-part
tax authority within three days for the purpose of payment of the relevant
sanctioned refund amount of tax or cess, as the case may be.
5.
It is requested that suitable trade notices
may be issued to publicize the contents of this Circular.
6.
Difficulty, if any, in implementation of the
above instructions may please be brought to the notice of the Board. Hindi
version would follow.
