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TMI BlogClarifications on issues related to refund.X X X X Extracts X X X X X X X X Extracts X X X X ..... elhi. Sir/Gentlemen/Madam, 1. The Commissioner vide Trade Circular No. 49T of 2017 and 52T of 2017 cited at Ref. (4) and (5), respectively clarified various issues in relation to processing of claims for refund on account of Zero-rated supply of goods or services or both. These Trade Circulars are based on various Circular(s) issued by the Central Board of Indirect Tax and Customs (CBIC), New Delhi i.e. Circular No. 17/17/2017 GST dated 15th November 2017 and Circular No. 24/24/2017 GST dated 21st December 2017. In addition to aforesaid Circular(s) CBIC has also issued Circular cited at Ref. (6) above and clarified certain issues involving GST refund. 2. On this background, several representations have been received seeking further clarifications on issues relating to refund. In order to clarify these issues and with a view to ensure uniformity in the implementation of the provisions of the GST Act, across the State, the undersigned, in exercise of its powers conferred by sub-section (1) of section 168 of the Maharashtra Goods and Services Tax Act, 2017 (hereinafter in this Trade Circular referred as MGST Act ), hereby clarifies the issues raised as below: 3. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd application accordingly. 5. Exports without LUT: 5.1. Export of goods or services can be made without payment of integrated tax under the provisions of rule 96A of the Maharashtra Goods and Services Tax Rules, 2017 (hereinafter referred to as the MGST Rules ). Under the said provisions, an exporter is required to furnish a bond or Letter of Undertaking (LUT) to the Nodal Officer before effecting zero rated supplies. 5.2. A detailed procedure for filing of LUT has already been specified vide Trade Circular No. 50T of 2017 dated the 7th December 2017. A facility for online submission of LUT at GSTN is also made available and same is explained vide Trade Circular No. 10T of 2018 dated the 28th February 2018. In view of this the tax payer is now not required to submit to the jurisdictional officer, the copy of the acknowledgement generated at GSTN for submission of LUT online. To know more please refer Circular No. 40/11/2018 dated the 6th April 2018 issued by the CBIC. 5.3. It has been brought to the notice of this office that in some cases, such zero rated supplies have been made before filing the LUT and refund claims for unutilized input tax credit have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e noticed. The said sub-rule also provides that once the deficiency memo has been issued, the claimant is required to file a fresh refund application after the rectification of the deficiencies. 7.2. In this connection, a clarification has been sought whether with respect to a refund claim, deficiency memo can be issued more than once. In this regard rule 90 of the MGST Rules may be referred to, wherein it has been clearly stated that once an applicant has been communicated the deficiencies in respect of a particular application, the applicant shall furnish a fresh refund application after complying with the deficiencies so communicated. 7.3. It is therefore, clarified that there can be only one deficiency memo for one refund application and once such a memo has been issued, the applicant is required to file a fresh refund application, manually in FORM GST RFD-01A . This fresh application would be accompanied with the original ARN, debit entry number generated originally and a hard copy of the refund application filed online earlier. It is further clarified that once an application has been submitted afresh, pursuant to a deficiency memo, the concerned refund processing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant period other than the input tax credit availed for which refund is claimed under sub-rules (4A) or (4B) or both . Thus so far as the refund on account of inverted duty structure is concerned the tax payer is entitled to claim the refund of input tax credit in respect of inputs as defined under section 2(59) of the MGST Act. In other words, the tax payer is not entitled to claim the refund of ITC under this category in respect of the services availed during the said period. 9.4. It is clarified that as the transitional credit pertains to duties and taxes paid under the existing laws viz., under Maharashtra Value Added Tax Act, 2002 or, as the case may be, Maharashtra Entry Tax Act, the same cannot be said to have been availed during the relevant period and thus, cannot be treated as part of Net ITC . 10. Discrepancy between values of GST invoice and shipping bill/bill of export : 10.1. It has been brought to the notice of the that in certain cases, where the refund of unutilized input tax credit on account of export of goods is claimed and the value declared in the tax invoice is different from the export value declared in the corresponding shipping bill und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct in the last return i.e. June-2017 return or refund under Entry Tax Act is granted in case the said amount has been transitioned under GST. The concerned refund processing authorities are advised to process such refund applications accordingly. 12. Grant of refund of the amount less than ₹ 1000/ -: 12.1. Sub-section (14) of the section 54 of the MGST Act provides that no refund under sub-section (5) or sub-section (6) shall be paid to an applicant, if the amount is less than thousand rupees. Therefore, in view of the aforesaid provisions, the tax payer is advised not to file the FORM-RFD-01A and claim the refund wherever such claim is less than ₹ 1000/. 12.2. The claim of refund of ₹ 1000/- either on account of accumulated ITC, IGST paid or of the excess in the electronic cash ledger is to be considered qua MGST/CGST/IGST/Cess. In case such claim is filed already then the refund processing officer need not grant the refund of the said amount. The FORM-RFD-04 or RFD-06 in such cases shall not be issued. The applicant may be informed accordingly. 12.3. However, in case the refund under one or more of the aforesaid Act(s) is below ₹ 1000/- an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of shipping bills or bills of export and the number and the date of the relevant export invoices is required to be submitted along with the claim for refund. 14.2. It is therefore clarified that insistence on proof of realization of export proceeds for processing of refund claims related to export of goods has not been envisaged in the law and should not be insisted upon. 15. Supplies to Merchant Exporters: 15.1. Notification No. 40/2017 State Tax (Rate), dated 23rd October 2017 and notification No. 41/2017 Integrated Tax (Rate) dated 23rd October 2017 (issued by the Board, CBIC) provide for supplies for exports at a concessional rate of 0.05% and 0.1% respectively, subject to certain conditions specified in the said notifications. 15.2. It is clarified that the benefit of supplies at concessional rate is subject to certain conditions and the said benefit is optional. The option may or may not be availed by the supplier and / or the recipient and the goods may be procured at the normal applicable tax rate. 15.3. It is also clarified that the exporter will be eligible to take credit of the tax @ 0.05% / 0.1% paid by him. The supplier who supplies goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copy of ARN generated at common portal. copy of Statement 2 of FORM RFD-01A Invoices w.r.t. input, input services and capital goods BRC/FIRC for export of services Undertaking / Declaration in FORM RFD-01A 2. Export (goods or services) without payment of tax (Refund of accumulated ITC of IGST / CGST / SGST / Cess) copy of FORM RFD-01A filed on common portal along with copy of ARN generated at common portal. copy of Statement 3A of FORM RFD-01A generated on common portal copy of Statement 3 of FORM RFD-01A Invoices w.r.t. input and input services BRC/FIRC for export of services Undertaking / Declaration in FORM RFD-01A 16.4 These Instructions shall apply to exports made on or after 1st July, 2017. It is also advised that refunds may not be with held due to minor procedural lapses or non-substantive errors or omission. 17. This trade circular is clarificatory in nature and cannot be made use of for interpretation of provisions of law. If any member of trade had any doubt, he may refer the matter to this off ..... X X X X Extracts X X X X X X X X Extracts X X X X
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