TMI BlogRefund on Inverted duty structureX X X X Extracts X X X X X X X X Extracts X X X X ..... A foreign company( F) and an indian company( D) together formed a consortium to execute a govt works contract services ( client-C). D imports materials from F and supplies them to C on cost basis with no value addition . D has to pay IGST on Import @ 18% and bills to Client on behalf of F(as F does not have any GST Regn) as per the Agreement on milestone basis @ 12%. So it ia case of Inverted dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y structure and D is supposed to get Refund. The fact is as per Agreement entered between consortium and client ,selling price of D to F is fixed as below: say cost of material to D(import price) = 100(mat cost)+5(BCD) = 105 . GST paid on RCM basis on 105=18.90.(available as ITC). D has to sell the goods as it is to client(C) at ₹ 100(inclusive of GST). So effectively B is seeling it as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost of ₹ 89.29(100/112*100). , tax charged to C=10.71. So D is selling goods to C at a loss and claiming credit from the Dept of Refund of ₹ 8.19(18.90-10.71). . query: wheather there will be any problem for grant of refund under inverted rate to D ? - Reply By Atul Mehrotra - The Reply = Request the experts to share their opinion about this. - Reply By Shilpi Jain - The Reply = ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Refund should be eligible as there is no condition for refund under inverted duty structure that the output tax has to be paid on more than the cost. - Reply By YAGAY andSUN - The Reply = In our view, before applying for refund due to inverted duty structure, you need to go through the Valuation Rules as goods are being sold on loss. - Reply By DeepakArya DGA - The Reply = Please check whethe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r this contract is hit by N.No. 15/Central tax(Rate) . If Yes, refund in such case will not be allowed in case of inverted duty structure. - Refund on Inverted duty structure - Query Started By: - Prasenjit Pal Dated:- 29-5-2021 Goods and Services Tax - GST - Got 4 Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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