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TMI BlogClarifications on exports related refund issues.X X X X Extracts X X X X X X X X Extracts X X X X ..... 2-28/2017-18-EXN-GST-3280-98 dated 3rd Feb., 2018 clarified various issues in relation to processing of claims for refund. Since then, 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 law across field formations, in exercise of powers conferred by section 168 of the Himachal Pradesh Goods and Services Tax Act, 2017 (HPGST Act), I hereby clarify the issues raised as below: 2. Non-availment of drawback: The third proviso to sub-section (3) of section 54 of the HPGST Act states that no refund of input tax credit shall be allowed in cases where the supplier of goods or services or both avails of drawback in respect of state tax. 2.1 This has been clarified in paragraph 8.0 of Circular No. 24/24/2017 GST, dated 3rd February, 2017. In the said paragraph, reference to section 54(3)(ii) of the HPGST Act is a typographical error and it should read as section 54(3)(i) of the HPGST Act . It may be noted that in the said circular reference has been made only to central tax, integrated tax, State / ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Commissioner 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 filed. In this regard, it is emphasised that the substantive benefits of zero rating may not be denied where it has been established that exports in terms of the relevant provisions have been made. The delay in furnishing of LUT in such cases may be condoned and the facility for export under LUT may be allowed on ex-post facto basis taking into account the facts and circumstances of each case. 5. Exports after specified period: Rule 96A (1) of the HPGST Rules provides that any registered person may export goods or services without payment of integrated tax after furnishing a LUT/bond and that he would be liable to pay the tax due along with the interest as applicable within a period of fifteen days after the expiry of three months or such further period as may be allowed by the Commissioner from the date of issue of the invoice for export, if the goods are not exported out of India. The time period in case of services is fifteen days after the expiry of one year or such further period as may be allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication has been submitted afresh, pursuant to a deficiency memo, the proper officer will not serve another deficiency memo with respect to the application for the same period, unless the deficiencies pointed out in the original memo remain unrectified, either wholly or partly, or any other substantive deficiency is noticed subsequently. 7. Self-declaration for non-prosecution: It is learnt that some field formations are asking for a self-declaration with every refund claim to the effect that the claimant has not been prosecuted. The facility of export under LUT is available to all exporters in terms of notification No. 37/2017- State Tax dated 29th Sep., 2018, except to those who have been prosecuted for any offence under the CGST Act or the IGST Act or SGST Act or any of the existing laws in force in a case where the amount of tax evaded exceeds two hundred and fifty lakh rupees. Para 2(d) of the Circular No. 8/8/2017-GST, mentions that a person intending to export under LUT is required to give a self-declaration at the time of submission of LUT that he has not been prosecuted. Persons who are not eligible to export under LUT are required to export under b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s should be sanctioned as refund. 10. Refund of taxes paid under existing laws: Sub-sections (3), (4) and (5) of section 142 of the HPGST Act provide that refunds of tax/duty paid under the existing law shall be disposed of in accordance with the provisions of the existing law. It is observed that certain taxpayers have applied for such refund claims in FORM GST RFD-01A also. In this regard, the field formations are advised to reject such applications and pass a rejection order in FORM GST PMT-03 and communicate the same on the common portal in FORM GST RFD-01B. The procedures laid down under the existing laws viz HPVAT Act, 2005 read with above referred sub-sections of section 142 of the HPGST Act shall be followed while processing such refund claims. 10.1 Furthermore, it has been brought to the notice of the Commissioner that the field formations are rejecting, withholding or re-crediting VAT credit, while processing claims of refund filed under the existing laws. In this regard, attention is invited to sub-section (3) of section 142 of the HPGST Act which provides that the amount of refund arising out of such claims shall be refunded in cash. Further, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the date of the relevant export invoices is required to be submitted along with the claim for refund. 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. 13. Supplies to Merchant Exporters: Notification No. 40/2017 State Tax (Rate), dated 20th November 2017 and notification No. 41/2017 Integrated Tax (Rate) dated 23rd October 2017 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. 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. 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 at the concessional rate is also eligible for refund on account of inverted tax structure as per the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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