Section 54 r w r 96A belated realisation - Reg., Goods and Services Tax - GST

[RaamSrinivasan Kalpathi]

We had exported engineering services under LUT and invoiced the client for $25000/- in March 2024. After remitting $15000/- the client expressed inability to settle the balance amount of $10000/-. The same was written off in the books as bad debts and we dutifully remitted GST @18% with appropriate interest u/s. 50 as provided in Rule 96A through DRC-03 challan for the unsettled amount of $10000/- in October 2024. The said client had today wired the balance amount of $10000/- and we have secured the FIRC.

The query is, can I claim refund of the amount remitted through DRC-03 or would it be appropriate to avail credit of the same in GSTR-3B in this month's return? Kindly clarify. Thanks

Posts / Replies

[KALLESHAMURTHY MURTHY]

Dear Sir, 

Please check Circular-26/26/2017-GST dated 29th Dec '17 if beneficial for you subject to re-appropriate the amount written off in the books of accounts.

In FORM GSTR-3B the differential figures for the past month(s) may be reported on a net basis along with the values for the current month in appropriate tables i.e. Table No. 3.1, 3.2, 4 and 5, as the case may be. However, negative figures cannot be shown in the GSTR-3B and the balance amount if any can be adjusted in the return(s) of subsequent month(s), and if such adjustment is not feasible, the refund can be claimed.  

Thank you.

[KASTURI SETHI]

In this scenario, claiming refund of tax paid through DRC-03 is better, easier and safer than availing ITC in GSTR-3B return. The revised entry in the books of account is no problem.

[KALLESHAMURTHY MURTHY]

Dear Sir, It is the most welcome suggestion in Sl.  No.2 of Sri Kasturi Sethi Sir.

[KASTURI SETHI]

Sh.Kailashamurthy Murthy Ji,

Sir, Thank you very much.

[Shilpi Jain]

Refund is an option. However, also go through circular 26/2017 - you could consider it to adjust against other tax liabilities and make an intimation to the department. This would be an easier and less time and resources consuming process.

[RaamSrinivasan Kalpathi]

Profuse thanks to all the experts.  Discussion and suggestion points were enlightening.  Pranams