TMI BlogClarification in respect of refund of tax specified in section 77(1) of the CGST Act and section 19(1) of the IGST ActX X X X Extracts X X X X X X X X Extracts X X X X ..... tion 77(1) of the CGST Act and section 19(1) of the IGST Act -Reg Representations have been received seeking clarification on the issues in respect of refund of tax wrongfully paid as specified in section 77(1) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act ) and section 19(1) of the Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as IGST Act ). In order to clarify these issues and to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the CGST Act , hereby clarifies the issues detailed hereunder: 2.1 Section 77 of the CGST Act, 2017 reads as follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pply, but which is subsequently held to be an inter-State supply, shall not be required to pay any interest on the amount of integrated tax payable. 3. Interpretation of the term subsequently held 3.1 Doubts have been raised regarding the interpretation of the term subsequently held in the aforementioned sections, and whether refund claim under the said sections is available only if supply made by a taxpayer as inter-State or intra-State, is subsequently held by tax officers as intra-State and inter-State respectively, either on scrutiny/ assessment/ audit/ investigation, or as a result of any adjudication, appellate or any other proceeding or whether the refund under the said sections is also available when the inter-Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST Act, sub-rule (1A) has been inserted after sub-rule (1) of rule 89 of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as CGST Rules ) vide notification No. 35/2021-Central Tax dated 24.09.2021. The said sub-rule (1A) of rule 89 of CGST Rules, 2017 reads as follows: (1A) Any person, claiming refund under section 77 of the Act of any tax paid by him, in respect of a transaction considered by him to be an intra-State supply, which is subsequently held to be an inter-State supply, may, before the expiry of a period of two years from the date of payment of the tax on the inter-State supply, file an application electronically in FORM GST RFD-01 through the common portal, either directly or through a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... following scenarios are explained hereunder: Sl.no. Scenario Last date for filing the refund claim 1 Having realized on his own that the said transaction is an inter-State supply, A paid IGST in respect of the said transaction on 10.05.2021. Since A has paid the tax in the correct head before issuance of notification No. 35/2021-Central Tax, dated 24.09.2021 , the last date for filing refund application in FORM GST RFD-01 would be 23.09.23 ( two years from date of notification ) 2 Having realized on his own that the said transaction is an inter-State supply, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RFD-01 would be 09.11.2024 (two years from the date of payment of tax under the correct head, i.e. integrated tax) The examples above are only indicative one and not an exhaustive list. Rule 89 (1A) of the CGST Rules would be applicable for section 19 of the IGST Act also, where the taxpayer has initially paid IGST on a specific transaction which later on is held as intra-State supply and the taxpayer accordingly pays CGST and SGST on the said transaction. It is also clarified that any refund applications filed, whether pending or disposed off, before issuance of notification No.35/2021-Central Tax, dated 24.09.2021 , would also be dealt in accordance with the provisions of rule 89 (1A) of the CGST Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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