NO.F.l-11(8)-TAX/2015

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1 · Circular No. 17/17/2017-GST.

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 tl1e 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 .FOH.lYI 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 or such refund or its further sanction respectively in PART-B of FORM GST RFD-07 ot· 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 or 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-OlA (as notified in the CGST Rules vide No. 55/2017- Central Tax dated 15.11.20 17) 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 RFDOlA 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-OlA submitted manually, along with the print out of FORM GST RFD-OlA 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

2 · 6 Once such a refund application in FORM GST RFD-OlA 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 -

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 -

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 -

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-

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-OlB (as notified in the CGST Rules vide notification No. 55/2017 -Central Tax dated 15.11.20 17) subject to the provisions of rule 93 of the CGSTRules.

3 · 1 Filing of Refund Claims:

3 · 2 Steps to be followed for processing of Refund Claims:

3 · 3 Detailed procedure for manual processing of refund claims:

2 · 0 It is clat i1ied that refund claims in respect of zero-rated supplies and on account of in verted duty structut · e , deemed exports and excess balance in electronic cash ledger shall be 1iled for a tax period on a monthly basis in FORM GST RFD-OIA.I-Iowever, in case registered persons having aggregate turno ver of up to Rs 1.5 cmrein the preceding financial year· or tl1e cutTent year at·e opting to !lie FORM GSTR-1 quarterly (notification No. 57/20 17-Central Tax dated 15.11.2017 t·efers), such persons shall apply for refund on a quarterly basis. Further, it is stated that the refund claim tor a tax period may be filed only

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4 · 0 Whereas, the Government has issued notification No. 48/20 17-Central Tax dated 18. I 0.2017 under section 147 of the CGST Act wherein certain supplies of goods have been notified as deemed export. Further, the third proviso to rule 89(1) of the CGST Rules allows the recipient or the supplier to apply for refund of tax paid on such deemed export supplies. In case such refund is sought by the supplier of deemed export supplies, the documentary evidences as specified in notification No. 49/2017-Central Tax dated 18.10.2017 are also required to be furnished which includes an undertaking by the recipient of deemed export supplies that he shall not claim the refund in respect of such supplies and that no input tax credit on such supplies has been availed of by him. The undertaking should be submitted manually along with the refund claim . Similarly, in case the refund is filed by the recipient of deemed export supplies, an undertaking by the supplier of deemed export supplies that he shall not claim the refund in respect of such supplies is also required to he furnished manually. The procedure regarding procurement of supplies of goods from DT A by Export Oriented Unit (EOU) I Electronic Hardware Technology Park (EHTP) Unit I Software Technology Park (STP) Unit I Bio-Technology Parks (BTP) Unit under deemed export as laid down in Circular No. 14/14/20 17-GST dated 06.11.2017 needs to be complied with.

4 · 1 Fut·ther, as per the provisions of rule 89(2)(g) of the CGST Rules, the following strncment 5B of FORM CST RFD-OlA is required to be furnished for claiming refund on supplies declared as deemed exports:-

5 · 0 T\ is t·eitcrated that para 2.5 of Circular No. 17117/2017-GST dated I 5.11.2017 may be te!'errcd to in order to ascertain the jurisdictional proper officer to whom the manual <tpplication lo r ret'und is to be submitted. Where any amount claimed as refund is rejected umlet' mlc 91 of the CGST Rules, either fully or partly, the amount debited, to the extent of rejection, shall be re-credited to the electmnic credit ledger by an order made in FORM CST HFD-1 B until the FORM GST PMT-03 is available on the common portal. Further, the payment of the sanctioned refund amount shall be made only by the respective tax authority of the Central or State Govemment. Thus, the refund order issued either by the Central tax authot·ity or the Stale tax/UT tax authority shall be communicated to the concerned counter-

6 · 0 In order to facilitate sanction of refund amount of central tax and State tax by tl1e respective tax authorities, it has been decided that both tl1e Central and State Tax authority shall nominate nodal officer(s) for the purpose of liasioning through a dedicated e-mail id. Where the amount of central tax and State tax refund is ordered to be sanctioned provisionally by the Central tax authority and ·a ·a sanction order is passed in accordance with the provisions of rule 91(2) of the CGST Rules, the Central tax authority shall communicate the same, through the nodal officer, to the State tax authority for making payment of the sanctioned refund amount in relation to State tax and vice versa. The aforc:;aicl communication shall primarily be made through e-mail attaching the scanned copies of the sanction order [FORM GST RFD-04 and FORM GST RFD-06], the application for rc1i11Hl in FORM GST RFD-01 A and the Acknowledgement Receipt Number (AR.N). J\ecolclingly, the jurisdictional proper ofticer of Central or Stale Tax, as the case may be, shall issue FORM GST RFD-05 and send it to the DDO for onward transmission for release of payment. After release of payment by the respective PAO to the applicant's bank account, the nodal officer of Central tax and State tax authority shall inform each other. The manner of communication as referred earlier shall be followed at the time of final sanctioning of the refund also.

7 · 0 In case of refund claim for the balance amount in the electmnic cash ledger , upon filing of FORM GST RFD-OlA as per the procedure laid down in para 2.4 of Circular No. 17/17/2017-GST dated 15.11.2017, the amount of refund claimed shall get debited in the electronic cash ledger.

8 · 0 ft is also clarified that the drawback of all taxes under GST (Central Tax, Jntcg.raled Tax, StateiUnion Territory Tax) should not have been availed while claiming refund or accumulated lTC under section 54(3)(ii) of the CGST Act. A declaration to this efTect forms part of FORM GST RFD-OlA as well.

9 · 0 It is requested that suitable trade notices may be issued to publicize the contents of this circular.

10 · 0 Difficulty, if any, in implementation of the above instructions may please be brought to the notice ofthe Board.

11 · 0 Hindi version would follow.