TMI BlogClarification on refund related issues.X X X X Extracts X X X X X X X X Extracts X X X X ..... of the West Bengal Goods and Services Tax Act, 2017 (hereinafter referred to as WBGST Act ), hereby clarifies the issues detailed hereunder: 2. Bunching of refund claims across Financial Years 2.1 It may be recalled that the restriction on clubbing of tax periods across different financial years was put in vide para 11.2 of the Trade Circular No. 05/2018 dated 17.03.2018. The said circular was rescinded being subsumed in the Master Circular on Refunds No. 45/2019-GST dated 21.11.2019 and the said restriction on the clubbing of tax periods across financial years for claiming refund thus has been continued vide Paragraph 8 of the Circular No. 45/2019 dated 21.11.2019, which is reproduced as under: 8. The applicant, at h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved that the Circulars can supplant but not supplement the law. Circulars might mitigate rigours of law by granting administrative relief beyond relevant provisions of the statute, however, Central Government is not empowered to withdraw benefits or impose stricter conditions than postulated by the law . 2.3 Further, same issue has been raised in various other representations also, especially those received from the merchant exporters wherein merchant exporters have received the supplies of goods in the last quarter of a Financial Year and have made exports in the next Financial Year i.e. from April onwards. The restriction imposed vide para 8 of the master refund circular prohibits the refund of ITC accrued in such cases as well. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 54 of the WBGST Act is available where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies. It is noteworthy that, the input and output being the same in such cases, though attracting different tax rates at different points of time, do not get covered under the provisions of clause (ii) of sub-section (3) of section 54 of the WBGST Act. It is hereby clarified that refund of accumulated ITC under clause (ii) of sub-section (3) of section 54 of the WBGST Act would not be applicable in cases where the input and the output supplies are the same. 4. Change in manner of refund of tax paid on supplies other than zero rated supplies 4.1 Circular No. 45/2019 dated 21.11.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h electronic credit ledger and electronic cash ledger. At present, in these cases, the amount of admissible refund, is paid in cash even when such payment of tax or any part thereof, has been made through ITC. 4.3.1 As this could lead to allowing unintended encashment of credit balances, this issue has been engaging attention of the Government. Accordingly, vide notification No. 443-F.T., dated 03.04.2020, sub-rule (4A) has been inserted in rule 86 of the WBGST Rules, 2017 which reads as under: (4A) Where a registered person has claimed refund of any amount paid as tax wrongly paid or paid in excess for which debit has been made from the electronic credit ledger, the said amount, if found admissible, shall be re-credited to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it ledgers (other than the refund of tax paid on zero-rated supplies or deemed export), the refund to be paid in cash and credit shall be calculated in the same proportion in which the cash and credit ledger has been debited for discharging the total tax liability for the relevant period for which application for refund has been filed. Such amount, shall be accordingly paid by issuance of order in FORM GST RFD-06 for amount refundable in cash and FORM GST PMT-03 to re-credit the amount attributable to credit as ITC in the electronic credit ledger. 5. Guidelines for refunds of Input Tax Credit under Section 54(3) 5.1 In terms of para 36 of Trade Circular No. 45/2019 dated 21.11.2019, the refund of ITC availed in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been examined and considering that such a distinction is important in view of the provisions relating to refund where refund of credit on Capital goods and/or services is not permissible in certain cases, it has been decided to amend the said statement. Accordingly, Annexure-B of the Trade Circular No. 45/2019, dated 21.11.2019 stands modified to that extent. 6.3 A suitably modified statement format is attached for applicants to upload the details of invoices reflecting in their FORM GSTR-2A . The applicant is, in addition to details already prescribed, now required to mention HSN/SAC code which is mentioned on the inward invoices. In cases where supplier is not mandated to mention HSN/SAC code on invoice, the applicant need not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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