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Refund of GST Paid on RCM for F.Y.17-18, Goods and Services Tax - GST

Issue Id: - 116488
Dated: 16-6-2020
Refund of GST Paid on RCM for F.Y.17-18

  • Contents

Dear Experts,

We had paid GST as per RCM for F.Y.17-18 while filling annual return GSTR-9 through DRC-03.

My first question is that ,I want to know whether am i eligible to get refund of this tax by virtue of Section 54(3) of CGST Act read with Rule-89 of CGST Rules 2017. If so, what is time limit within which we may apply for refund?

Our tax consultant has submitted above comments in GSTR-9C (in Auditor's comment) stating that assessee is eligible to get above refund but ,

Rule 89(3) of CGST Rules, 2017 also provide that where the application relates to refund of input tax credit, the electronic credit ledger shall be debited by the applicant in an amount equal to the refund so claimed. But while filling GSTR-3B, our CGST Credit Ledger balance automatically gets fully utilised by virtue of set-off rules so we would not be able to hold balance equivalent to CGST Refund amount which we are going to apply of RCM Paid tax. Now, how to claim refund of tax paid?

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Posts / Replies

Showing Replies 1 to 15 of 20 Records

1 Dated: 16-6-2020
By:- Ganeshan Kalyani

How a refund be claimed of the liability paid under rcm. RCM is a liability which has to be paid.

2 Dated: 17-6-2020
By:- Alkesh Jani


When payment of DRC-3 was made?

3 Dated: 17-6-2020


We paid Tax through DRC-03 on 13.02.2020

4 Dated: 17-6-2020
By:- Alkesh Jani

Shri Nishant,

Now please elaborate, on what ground or for which activity auditor concluded that tax paid can be refunded.

Secondly, Section and Rules will come into play after we conclude the above.

5 Dated: 17-6-2020

Dear Kalyaniji,

Then what Rule 89(3) talks about, for refund of unutilised ITC? If you read this rule read with sec. 54(3), it says it clearly about refund and our legal consultant is of same view. But I'm not clear about this provision. Detail explanation is required for this issue.

& My question is clear about how can i get tax refund of this RCM Paid?

6 Dated: 17-6-2020

Dear Alkesh Sir,

I don't understand this section and rule clearly but my question is clear as to how can i get credit of this tax or get refund??

If I'm eligible to get my tax paid back, how can i get it and if not, then let me know reason of it with time barred limit provision for not claiming same credit?

7 Dated: 17-6-2020

Dear Alkesh Sir,

This is word to word comment made by our auditor.

"Though as per provisions of Sec 9 of the GST Act, tax payer is entitled to get credit of RCM Paid within prescribed time limit, here, since the tax payer has paid RCM at the time of filing
annual return and reconcillation statement, tax payer is advised to file refund application U/S 54 Rule 89 of the GST act and rules."

8 Dated: 17-6-2020
By:- Alkesh Jani

Shri Nishant,

As per the note of the auditor, what I understood is that You have already paid the tax under RCM for the relevant period and the amount paid by you by DRC-03 is in excess and for this you were advised to file refund under Section 54(1) of CGST Act. (any other amount).

The time limit is of two years from the date of payment. In terms of Rule 89(2)(k) a statement showing that excess payment was made is required to be submitted.


9 Dated: 17-6-2020

Dear Alkesh Sir,

We had not paid Tax on RCM on transportation services availed by us for the period 01.10.2017 to 31.03.2018 in the impression that tax is not payable by us but later on, query raised in audit and they advised us to pay Tax on RCM while filling Annual Return and hence we paid tax and they suggested us to get refund of same considering above rules & section.

10 Dated: 17-6-2020
By:- Alkesh Jani

Shri Nishantji,

I think now the proper query is put forth. In this case, as you have paid the tax under RCM for transportation of goods at the time of filing annual return, ITC can be availed within the limitation period provided under Section 16(4) of CGST Act. Moreover, No refund can be claimed in this regards.

However, to contest is one’s own choice.

This in my view.


11 Dated: 17-6-2020

Sir, but how can i validly claimed itc since it's time period already lapsed since I am going to get credit of F.Y.17-18, how can i get it?

12 Dated: 17-6-2020
By:- Alkesh Jani

Shri Nishantji,

I already said that ITC can be claimed as per the provisions of CGST Act. if the time has lapsed, ITC also gets Lapsed.


13 Dated: 17-6-2020

Ok sir.

Thanks for your valuable opinion

14 Dated: 18-6-2020

Refer press release Dated 03/07/2019 para G. You may pay RCM of 17-18 in 18-19 and claim ITC for the same in 18-19. But you have paid it through DRC 03 as your liability U/s. 9(3) of CGST Act 2017. Amt paid through DRC 03 will not reflect in your credit ledger hence you cannot claim ITC for the same. At same time you not eligible for refund. Now it becomes your cost.

15 Dated: 18-6-2020

Ok Sharadji, Thanks for your valuable suggestion.


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