As we know “export of goods or services or both and supply of goods or services or both to SEZ” is called as Zero Rated supplies. A registered person making zero rated supply shall be eligible to claim refund under either of the following options,
(i) Supply of goods or services or both under bond or Letter of Undertaking without payment of IGST and claim refund of unutilised input tax credit; or
(ii) Supply of goods or services or both on payment of IGST and claim refund of such tax paid on goods or services or both supplied.
Here in this article we will see, refund procedure for claiming IGST paid on export of goods out of India or supply of goods to SEZ’s.
Let see in detailed …
Refund Procedure on account of Export of Goods with Payment of Tax:
Upon receipt of information regarding furnishing of valid return in Form GSTR-3B & Form GSTR-1 by the exporter, the Customs shall process the claim for refund and an amount equal to the IGST paid in respect of each shipping bill shall be credited to the bank account of the exporter.
As per Rule 96 (1) of CGST Rules, the shipping bill filed by an exporter shall be deemed to be an application for refund of IGST paid on the goods exported out of India and such application is valid only when proper filing of Export General Manifest and the applicant has furnished a valid return in FORM GSTR-3B and mentioned the details of relevant export invoices in FORM GSTR-1.
Upon confirmation of valid return filing by common portal, the system designated by the Customs shall process the claim for refund and an amount equal to the IGST paid in respect of each shipping bill or bill of export shall be electronically credited to the bank account of the applicant mentioned in his registration particulars.
Points of interest:
1. One must ensure that, there should not be any mismatch in mentioning of exports values and IGST paid between GSTR-3B and GSTR-1
2. Exporters must file their GSTR-1 very carefully to ensure that, the details of zero rated supplies declared in Table 6A of return in Form GSTR-1 are matched with the corresponding details available in Customs Systems as per details provided in shipping bills/ bill of export.
3. Mentioning of shipping bill/bill of export and port code details in Table 6A of GSTR-1 is mandatory to process the refund. Table 6A is related to mentioning of export supplies details.
4. For smooth processing of refunds, bank account details mentioned in customs registration particulars and in GST registration particulars shall be same.
Conclusion: Once, the details of export invoices are filed on the GST Portal under Table 6A, the details will be matched with the shipping bill filed with the Customs Department and amount mentioned in GSTR 3B return. If all the information matches, then GST refund on exports will be quickly processed by the Government
1. If I miss Shipping and Invoice details in a month, can I add the details in the subsequent months and get refund?
Yes, you can add the details of Shipping and Invoice in the subsequent month Form GSTR-1 and get refund.
2. In which bank account, will the refund amount be credited? Whether the bank account will be the account I entered in my enrolment/registration form?
The refund will be credited in the Bank account mentioned by you with the ICEGATE/ Customs.
3. How do I show my outward supplies of export in Form GSTR 3B?
While filing return in Form GSTR 3B for a tax period, please ensure that export and supply to SEZ are reported against item 3.1 (b) of table 3.1 of Form GSTR 3B. Such supplies should neither be included in supplies reported against item 3.1 (a) nor against item 3.1 (c).
Further, IGST and Cess amount reported in table 3.1(b) of FORM GSTR 3B is either equal to, or greater than, the total IGST and Cess from invoices filed under table 6A, and table 6B, of FORM GSTR-1.
4. How do I provide details of my export invoices in Form GSTR 1?
For providing details of export invoices in Form GSTR 1 for the corresponding tax period, please note:
i. Invoice data for export of goods is provided in Table 6A of FORM GSTR-1 for that particular tax period.
ii. Invoice numbers provided in Table-6A of FORM GSTR-1 are same as that given in Shipping Bill.
iii. WPAY/WOPAY (with payment or without payment of tax) is correctly selected for an invoice.
iv. Shipping bill number, shipping bill date and port code is correctly provided for each invoice. Port code is alphanumeric six-character code as prescribed by ICEGATE.
v. Invoice Value is the total value of supplies to be exported covered by the invoice including tax and other charges, if any.
vi. Taxable Value is the value of goods, on which tax is to be paid (Value net of tax).
vii. Tax Paid is IGST and Cess, only, in case where the export is done on payment of tax.
5. What can I do for incorrect/incomplete export invoices filed in table 6A of Form GSTR-1 of previous periods?
Incomplete/incorrect details of export filed in Form GSTR-1 of previous periods can be amended through Table 9A (Amended Export Invoices) of Form GSTR 1 of subsequent period. If any invoice is left to be reported in Table 6A of Form GSTR 1 in a particular month, then same can be reported in the Table 6A of Form GSTR 1 of subsequent period.
6. What can I do for errors made in Form GSTR 3B of previous periods?
Anomalies in filing of return in Form GSTR-3B of a tax period may be adjusted in GSTR-3B of subsequent month, as per circular number 26/26/2017 dated 29-Dec-2017, issued by CBEC:
i. If IGST and Cess paid on exports has been declared in table 3.1(a) or table 3.1(c) instead of table 3.1(b), appropriate adjustment may be done in subsequent month to the extent possible. Values of current month shall not become negative while making adjustment.
ii. If IGST and Cess paid on exports has been declared as ZERO in table 3.1(b), the correct amount can be declared and offset during GSTR 3B filing of subsequent month.
iii. If IGST and Cess paid on exports declared in table 3.1(b) is lesser that the total IGST from invoices filed under table 6A, and table 6B, of FORM GSTR-1, differential amount of IGST and Cess can be declared and offset during GSTR 3B filing of subsequent month
7. How can I get my IGST refund where my commercial invoices data of Shipping Bills are not matched with GST invoice data of GSTR1/Table 6A of GSTR-1?
You have to modify your invoice declared under Table 6A of GSTR 1 in Table 9A of GSTR-1 of the subsequent tax period. GST System will revalidate and sent it to Customs for further processing.