Masters India

Refund Process For Exporters Under GST

Seep Gupta
Seep Gupta at March 06, 2023

This article talks about the latest developments in the refund procedure for exporters under GST regime who were suffering due to huge working capital blockages either due to payment of IGST for making exports or by way of un- utilised ITC on inputs in case the exports were effected via LUT/Bond and non-availability of the refund module (RFD-01) on the GSTN common portal. In this article, we will discuss export with payment of igst refund process, gst refund calculation for export, gst refund on export.

As per Section 54(8) of the CGST Act, Refunds may arise under the following situations:

  1. Exports of goods with payment of IGST (Rule 96 applicable)
  2. Exports of goods without payment of IGST.( accumulated ITC) (Rule 89 applicable)
  3. Exports of services with or without payment of IGST( both situations) (Rule 89 applicable)
  4. On account of supply of goods or services made to SEZ Unit / SEZ Developer.
  5. In case of deemed Exports,
  6. On account of assessment/ provisional assessment/ appeal/any other order
  7. ITC accumulated due to inverted tax structure
  8. Tax paid on advances and subsequently refunded due to non -supply or partial supply.
  9. Tax deposited under wrong head

As per the provisions of GST Law, Refunds to be granted to the dealer electronically on the basis of application in RFD-01 in all the above cases except Exports of Goods with payment of IGST for which Exports details are required to be filled in Table 6A of GSTR-1 and the same would be deemed to be an application for Refund.

But due to the non-availability of the refund module (RFD-01) on the common portal, the refund could not be claimed by the dealer and GSTR-1 provided initially only for July-2017 and later on Window closed on 04/10/2017 even for GSTR-1 and now extended the due date for filing GSTR-1 up to 31/12/2017 for the month of July-2017, August-2017, September-2017 & October-2017.  Under the situation, none is in a position to claim Refund from the department.

Vide Notification No.39/2017-Central Tax, dt. 13-10-2017 Officers are given powers to sanction, process and grants Refunds manually to the dealers.

Vide Notification No.45/2017-Central Tax, dt. 13-10-2017, an additional Table 6A of GSTR-1 is provided on the portal to facilitate early refunds as the due dates for GSTR-1 has been extended to 31.12.2017 for the m/o July, August, September & October 2017 and this Table 6A will be auto-populated in the GSTR-1 of the respective tax periods as and when final GSTR-1 would be finally filed by the dealer. This additional Table 6A is given on the portal so that the exporters can file the details of zero rated supply and proceed for refund without having to wait to file GSTR-1.

The refund of integrated tax paid on goods exported out of India (as listed at S. No. 1 above) is governed by rule 96 of the CGST Rules which says that the shipping bill filed by an exporter shall be deemed to be an application for refund. This application shall be deemed to have been filed only when export details are filed in TABLE 6A OF GSTR-1 which is available on the common portal and the applicant has furnished a valid return in FORM GSTR-3B. 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.

The Shipping bill details shall be checked by officer through ICEGATE SITE ( wherein the officer would be able to check details of EGM and shipping bill by keying in port name, Shipping bill number and date. It is essential that exporters should ensure that there is no discrepancy in the information furnished in Table 6A of GSTR 1 and the Shipping Bill. It has been observed that certain common errors such as incorrect Shipping Bill number in GSTR1, mis-match of invoice number and IGST amount paid, wrong bank account etc. are being committed by exporters while filing their returns. These errors are the sole reason for delay in grant of refunds, or rejection thereof. While information has been made available to Exporters on the ICEGATE portal if they are registered, they may also contact jurisdictional Customs authorities to check the errors they have committed in furnishing information in GST returns and Shipping Bill, and rectify them at the earliest.

As the Customs system is designed to automatically grant refunds without involvement of any officer by matching information that is furnished on GSTN portal and Customs system, the onus is on the exporters to fill in all the details accurately. Exporters may therefore take due precaution to ensure that no errors creep in while filing Table 6A of GSTR 1 of August 2017 and onwards. The facility for filing GSTR 1 for August 2017 would also be ready by 4th December 2017. In case of wrong entries made in July, Table 9 of GSTR 1 of August month would allow amendments to GSTR 1 of July 2017.

Although RFD-01 was required to be filed electronically for claiming any nature of refund mentioned above except Exports of goods with payment of IGST but in the absence of RFD-01 on the common portal,  a New form RFD-01A introduced to be filed manually by the exporters to facilitate early Refunds vide Circular no.17/2017 dated 15-11-2017.

As per Circular No. 17 dated 15/11/2017, RFD-01A can be filed manually by the Exporters in case of following situations

  • Exports of Goods without payment of IGST
  • Exports of services with or without payment of IGST
  • On account of supply of goods or services made to SEZ Zone / SEZ Developers

The application for refund of IGST Paid on Exports of services and supply of Goods or services or both to SEZ Zone or SEZ Developer shall be made by filing the printout of FORM GST RFD- 01A manually with the jurisdictional GST officer.

For Refund of unutilized ITC in all cases whether supply of goods or services or whether supply to SEZ Zone or SEZ Developers, in which supplies made without payment of IGST 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 means The corresponding electronic credit ledger of CT / ST / UT / IT/ Cess would get debited and an ARN number would get generated which is to be mentioned on the printout of FORM GST RFD- 01A and needs to be submitted before the jurisdictional GST. Exporters are therefore advised to immediately file -

(a) Table 6A and GSTR 3B, if not already done, for processing of IGST refund

(b) RFD 01A on GSTN portal for refund of the unutilized input tax credit on inputs or input services used in making exports

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